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Difference between a payment gateway and a 3rd party processor?
What is the difference between a payment gateway and a 3rd party processor?

 8:24 pm on May 1, 2007 (gmt 0)


I've spent a few hours reading many threads here and have learnt a lot, thanks.

My question is :

What is the difference between a payment gateway and a 3rd party processor?



Corey Bryant

 1:25 pm on May 2, 2007 (gmt 0)

Basically an electronic payment gateway is the virtual connectivity between your website and the transaction processor (which might approve / decline the transaction) or send it over to the card association. The gateway is used in conjunction with a merchant account. (Hopefully others can give you a few names as an example - I am not allowed.)

A 3rd party processor - Internet Payment Service Provider (IPSP), you basically use their merchant account account to process credit card transactions. Usually consumers are directed to the IPSP's secure website to process the transaction.

With an electronic payment gateway, you can usually process credit card transactions on your secure website to maintain consistency when checking out



 6:38 pm on May 3, 2007 (gmt 0)

Thanks for the clarification.

Can anyone recommend any good 3rd party processors for international clients (send me a sticky please).


Corey Bryant

 8:32 pm on May 3, 2007 (gmt 0)

It depends on where you are. Most processors will look at the merchant's location first



 3:32 pm on May 8, 2007 (gmt 0)

Also, a third party processor uses a generic descriptor. (that is, what the buyer sees on their credit card statement)

A payment gateway tied to your own merchant account uses the name of your company as the descriptor.

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