A payment gateway is a hosted software application that authorizes credit card payments and ach (check) payments between a website and a credit card processor. A payment gateway is similar to a POS (Point-of-sale) terminal located in many retail stores. Payment gateways encrypt sensitive information, such as credit card numbers, amount, and customer name, passing that info to the credit card processor, who then processes the payment through the Visa / MasterCard network. The transaction result is then sent back from the issuing bank to the credit card processor, who then returns the results of the transaction (either approval or decline) to the payment gateway. The payment gateway thus acts as the intermediary between the website and the credit card processor.

We use the Authorize.net payment gateway, as it is has the most features, is the easiest to use, and is pre-integrated with most every shopping cart. The diagram below shows how Authorize.net payment gateway works. For more details and even a live of MerchantPartners.com demo, click here. If you sign up with Edge Payment Solutions, Inc, setup of the MerchantPartners.com payment gateway is extremely affordable.