A Payment Gateway (PG) is a crucial component for online businesses, serving as an intermediary system that connects merchants with financial service providers to ensure fast, secure, and efficient online payment processing. One of the key dimensions of a PG is its integration model, which is typically divided into two main types: Hosted Payment Gateway and Integrated/On-site Payment Gateway. Each type addresses different business needs and operational requirements.
Among these, the Integrated/On-site Payment Gateway is considered the optimal choice for enhancing customer experience. This model allows customers to enter their payment information directly on the merchant’s website without being redirected to an external provider’s site. Transactions are processed seamlessly in the background via API connections or a self-hosted payment page, providing a frictionless checkout process.
The main advantage of an Integrated/On-site PG is its ability to deliver a smooth, continuous, and branded user experience. Customers can complete payments without leaving the merchant’s platform, which builds trust and significantly reduces cart abandonment. Merchants also have full control over the payment page’s design (UI/UX), ensuring that the payment journey aligns consistently with the brand experience from start to finish.
However, the flexibility and control offered by Integrated/On-site PGs come with greater responsibility. Implementing this model often requires a dedicated development team to integrate via API, and merchants are directly accountable for customer data security, including adherence to the PCI DSS (Payment Card Industry Data Security Standard)—the global standard for protecting cardholder data.
With these features, Integrated/On-site Payment Gateways are particularly suitable for medium to large businesses that aim to fully control the customer experience and possess the technical resources and security capabilities to manage sensitive payment information. This solution is also ideal for brands seeking to customize the payment process to align with business strategies, differentiate themselves in the market, and enhance overall customer satisfaction at every stage of the transaction.
