Process of Payment Gateway Integration in a Mobile App

April 22, 2020

Ever wondered how much we love to end up in an impromptu online shopping? What is the reason, ease, comfort, safety, security? Well, it's everything! We just love the feeling of effortlessly transferring amounts into the respective accounts using our smartphones and receiving our products in return. The built-in payment gateways in the eCommerce stores have facilitated seamless transactions and have soon acquired a monopoly position. Do you wish to find out how you should integrate a payment gateway in the app that will elevate the user experience? If yes, read this blog...

It is estimated that mobile payment volume will increase tenfold by the end of 2021! That’s big news to digest, isn’t it? Well, 35 million Americans along with others possess smartphones and have adopted online payment methods. It is expected that these users will take the online payment transaction volume hit to $275 billion by 2021.

For millennials, online shopping is a go-to option to make purchases instead of physical shopping. The competition of such eCommerce stores is high and the business owners need to think of ways in which they can stand out from the rest. Online payment gateways are an integral part of the eCommerce industry. It has made buying and selling of goods, local as well as internationally a lot easier for the buyers and the sellers both.

Mobile app development companies are constantly trying to develop an app for iOS and Android facilitating in-app purchases. With a pool of options of payment gateway options like PayPal, Stripe, Square, Dwolla available in the market, it is difficult to choose one for your app.

You can check out our blog on the top 5 payment gateways comparison blog and make the right choice.

Before we move forward with the payment gateway integration process, let’s understand the definition of it.

What is a payment gateway?

In simple words, a payment gateway is financial software that handles online transactions and transfers a money amount between the customer and seller. This technology allows customers to integrate credit & debit cards to make payments through mobile applications.

It collects essential information from the consumer and sends it to the banks. Payment gateway integration in an app is important specially if the app deals with hotel reservations, travel bookings, grocery shopping, salon booking, etc.

The payment gateway integration in the mobile app allows the user to have a flawless shopping experience without any disturbance.

How does a payment gateway work? What is the mechanism?

An internet connection is a must for processing any amount using a payment gateway. A buyer puts up the selected item in the shopping cart and places the buy now option. You get navigated to the page where you need to fill up the basic credit card and other details in the form.

The payment gateway processes the information and sends it across to the respective bank. After proper verification, as soon as the bank approves the payment, the amount gets debited from the customer’s account and credits into the seller's account.

There are certain things that you need to consider before you proceed for payment gateway integration.

Seller Account Types:

A seller account is an account where the money is transferred once the customer pays. A seller has two account options to choose from, first is a dedicated account and the second is an aggregated merchant account.

A dedicated account gives the seller complete control over the financial activities. It is a devoted account that allows you to correct any financial errors in the entry and allow you to claim a chargeback. Needless to say, this account type is more expensive and time-consuming.

On the other hand, aggregated merchant accounts hold the funds of multiple sellers. It is a faster and better approach because it releases the funds usually within 24 hours. It is less expensive but at the same time, less secure than the dedicated account type.

The Products you want to sell:

The products you want to sell on the app have a lot to deal with the decision of mobile app payment gateway integration. The reason being, physical goods payment processing is different from digital goods payment processing.

The payment approach for physical goods is easy and approachable, but with digital products, it is a different story. Android and iOS platforms do not allow merchants to use third-party eCommerce payment services. Payment gateway integration in iOS and Android apps is platform-specific. The transaction is performed using the respective individual’s platform-specific account which further connects with the payment gateway.

Security Compliances:

Usually, almost all the payment gateways available provide a security certificate that ensures the users’ data security. However, before selecting the gateway for your application, check the PCI DSS compliance certificate issued by the payment gateway officials.

To receive the security compliance certificate, you need to design the app that meets the PCI DSS standards. This is to ensure that you meet the required standards of protecting sensitive credit card/debit card information. The officials will review and audit the system and the organization. If found compliant, the certificate will be issued to you.

What are the payment gateway options available?

There are incredible options available when it comes to mobile app payment gateway integration. However, which one should you choose for your classic app, is completely your call. In the next section, we have listed down briefly about the payment gateway options. You can find the detailed comparison chart in our other blog.

PayPal:

One of the popular and functional payment gateways used by many industry-leading apps is PayPal. It is undoubtedly the winner of all payment gateways and extends support all over the world. It accepts payments in almost 26 currencies and successfully processes 5-10 million payments every day. It charges 2.9% +$0.30 per transaction.

Needless to say, it holds around 60.2 % share in the global market. It is a reliable and secured payment gateway on the list.

Stripe:

Stripe is another popular payment gateway that is user-friendly and secure. It supports more than 100 currencies and even deals with Bitcoin. It is also a developer-friendly gateway, which allows them to manage APIs easily to develop a tailored mobile application.

One of the features that distinguish Stripe is the capability to transfer data of the credit card to a new payment gateway. Stripe charges 2.9% + $0.30 per transaction.

Braintree:

A subsidiary of PayPal is Braintree. The payment gateway services support over 45 countries in the world and rightfully remain in the list of top 5 payment gateways. Braintree boasts about the support to around 130 currencies and faster processing of credit cards than any other. The mobile app payment gateway comes with a Software Development Kit that is written in seven languages for Android and iOS. It charges 2.9% + $0.30 per transaction.

The other options available on the list are Dwolla, Square, EziDebit, Zooz, Authorize.net, Aduyen, Amazon Payment and many others. Research well before you end up with the final selection of payment gateways for your app. The final decision depends on your business requirements.

How to integrate payment gateway in a mobile app?

Once you have selected your payment gateway service provider, you will receive a Software Development Kit (SDK), that contains a detailed description of the gateway. This SDK can easily be obtained from the official website.

The information mentioned in this document helps developers in integrating the payment gateway into the mobile app. The kits’ features and libraries also allow the developers to create the form and collect the necessary information.

However, depending on the framework you choose for development, you need to ensure twice that your selected gateway supports the same.

Payment Gateway integration in an Android Application:

1. Use Drop-in UI and connect the payment gateway with the android device.

2. On app restart, the server sends a request for the client token and you receive a client token. A new token code gets generated on every app launch.

3. At this step, you can use the Drop-in UI and start collecting the users’ information in the customized form.

4. Check the working of the payment gateway integration. You will need the account to check this step and fill in the real card numbers.

5. Once the data is entered, the gateway forwards it to the server and initiates the transaction.

Payment Gateway integration in an iOS Application:

The steps and mechanisms of integration are almost the same as Android. However, only the integration using the code varies in iOS applications. You can hire a developer who is an expert in iOS payment gateway integration to perform the task for you.

How much time is required to integrate a payment gateway into the mobile application?

Regardless of the payment gateway you choose for your application, it will take around 40 hours to integrate it. If your application platform is Android or iOS, it will take around 20 hours to check the functionality. And you need to invest some additional 5-10 hours to extend technical support to the app on a monthly basis.

How much is the cost of integrating a payment gateway in an app?

Once you finalize the payment gateway, you will need to add basic as well as advanced features in the app. This may consume time and cost you a penny. However, the estimated cost of payment gateway integration is around $3000 to $10,000.

Wrapping up:

We hope you have got a clear understanding of the basics of payment gateway integration in your mobile application. The implementation and integration of it are simple and easy. Hence, if you have an app idea, look no further. The whole world is moving towards mobile payment. Are you ready to participate in the trend?