To answer the growing need for online transactions that protect all parties, technologies such as payment gateways have been massively developed over the past decade.

The presence of a payment gateway is in line with Experian's report which states that 55% of consumers agree that transaction security is the most important aspect of their online shopping experience.

The same report also shows that 49% of the total respondents expect business owners to commit to strengthening the security of their stores. As a result, the application of this technology is even more important for today's e-commerce users, whether it's by sellers or buyers.

In this article, we will review the ins and outs of a payment gateway, such as its meaning, variety, benefits, and how it works. In addition, so that you get to know this technology better, we have included examples of payment gateway users in Indonesia.

First of all, you can start by learning what a payment gateway is through the following explanation.


What is a Payment Gateway?

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The term “payment gateway” refers to the software that authorizes payments made online. The software is connected to an e-commerce or payment processing system. For example, credit card processing networks or digital banking.

The payment gateway is also a third party between the seller and the buyer that securely sends the customer's money to the merchant's bank account. You can find them in most retail outlets in the form of point-of-sale (POS) terminals, although payment gateways also take other forms.

Basically, this technology does the following things:

  • Integrated with merchant account
  • Record payment details for consumer transactions
  • Directing information to a payment processor or acquirer
  • Send notification of approval or rejection back to the merchant

For online businesses, this service is an important element that makes it easy to accept online payments through various methods. For example, by credit card, electronic check, or e-wallet.

Another plus point of this technology is the ease with which merchants can receive payments directly from their marketplace or website without the need to download or install additional plug-ins.

On the other hand, for buyers, a hassle-free transaction experience is a must. Well, payment gateways enable this capability, making online buying and selling activities as easy as possible for all parties.

As a result, it is not surprising that this service is increasingly widespread in the e-commerce ecosystem in the country. Next, know the functions that certain types have by continuing to the description below


Getting to Know Various Payment Gateways

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There are three types of payment gateways that are commonly used, namely:

1. Hosted Payment Gateway

In the hosted payment gateway, when the buyer clicks the gateway link from the checkout page, the buyer will be forwarded to the payment service provider page. After the buyer fills in their data there, they will be returned to the seller's website to complete the payment. An example of a hosted payment gateway is PayPal.

2. Self-hosted Payment Gateway

In this method, the seller's website processes data related to payments made by the buyer. The data is then sent to the payment gateway link in an encrypted format to maintain confidentiality. Therefore, it is important to ensure that your business works with a provider that is credible and guaranteed to be secure. An example of a self-hosted payment gateway is ShopeePay.

3. API Hosted Payment Gateway

Through the Hosted Payment Gateway API, payment transaction processing is supported by the service provider through the API. The buyer enters information for payment (e.g. debit card or credit card) directly on the checkout page on the seller's website and the payment is processed using the payment gateway's API. Through the API, even though data exchange occurs, the security of consumer data is maintained because third parties cannot collect consumer data. BRIAPI is an example of this payment gateway API service provider.

What are the Benefits of a Payment Gateway?

cashless credit card payment


For Business Owners


1. Simplify the Payment Process

The biggest benefit of using a payment gateway is the realization of an easier payment process. The whole procedure will be simplified, from request, authorization, acceptance, to confirmation. In addition, because the payment system has been completely integrated, the transaction process has become faster, both for buyers and for sellers.

2. Customizable


Further benefits, sellers can also customize the checkout process at a store or business according to their individual needs and preferences.

If you are a businessman who wants to maintain consistent branding on your website, then you should consider implementing a payment gateway immediately


3. Safer Transaction Experience

Payment gateway innovations are equipped with advanced security and fraud prevention features. This is because buyer data and information related to these transactions are not stored by the merchant, but by the system provider.

4. Supports Multiple Transaction Types

Some payment gateways can support various types of transactions at once, not just certain payments. Currently, more and more alternative payment methods are used by people, so by implementing a payment gateway, the more you can facilitate.

Also Read: What is Digital Business: Definition, Examples and Opportunities for Digital Business in 2022

For Consumers

1. Bringin Ease in Transaction


Consumers can shop and make payments anytime and anywhere thanks to a payment gateway. As a result, online payments have become much more convenient and easier than before.

In addition, unlike physical stores which have operating hours, customers are not hindered by time restrictions for transactions.


2. Speed ​​up the Payment Process

With this service, payments can be made with just one click. Buyers also have more than one option to make recurring payments. Therefore, the process is even more convenient and faster without having to input information from scratch.

3. Protected Security


You need to make sure that you work with a payment gateway provider that has guaranteed credibility and security, by looking at the security standards it has successfully met. One of the internationally accepted security standards is the Payment Card Industry Data Security Standard (PCI DSS), which is a set of provisions that stipulate that all companies that process, store, or transmit transaction information create a secure transaction environment.

For API providers, Bank Indonesia has also launched the National Open API Payment Standard (SNAP) which aims to create a healthy, innovative, and competitive payment system industry in order to provide payment system services that are not only easy and efficient, but also guaranteed security.

As a result, the security of customer data during the transaction process is guaranteed. Also, buyers' trust in merchants has increased


4. Faster Transactions

Another attraction of payment gateways is that all transactions occur much faster than manual processing. Well, besides saving time, this method also brings number one convenience to buyers.

How Payment Gateways Work


This service acts as an interface between the merchant's website and the payment processing bank or acquirer. The payment gateway itself can be used for various types of payment methods, but the description below will focus on online payments using credit cards.

First, payment gateways encrypt credit card details that are classified as “sensitive” to ensure that information flows securely between buyers, sellers and acquirers. Then, when consumers buy products or services on a website that is connected to the gateway, the software will process the transaction.

After the customer confirms their order and checkout, the website will direct them to the payment page to enter their credit card details.

If a verified merchant complies with PCI DSS security standards, information from checkout is collected and forwarded to the preferred payment gateway application from the payment page.

Next, the payment gateway processes the transaction and sends all the information to the bank via the acquirer and the applicable card scheme. Once the payment is confirmed, the gateway sends a valid transaction back to the merchant's website.

Finally, the merchant notifies the customer that the purchase was successful.

Amazingly, this entire process only takes about three seconds, making the payment gateway a cutting-edge innovation.


Also Read: Digital Payment Trends in Indonesia, Embracing The New Form of Money with BRIAPI

Examples of Payment Gateway Users in Indonesia

debit card payment


With the widespread use of payment gateways in Indonesia, BRI is also here to offer the best banking features and services to support the development of digital payment systems. One of them is through BRIAPI, an open banking technology developed by BRI.


BRIAPI itself has launched various products to accommodate various existing transaction processes, including BRI Direct Debit and BRIVA.

Not only that, BRIAPI has collaborated with many partners and acts as a secure processing channel during the payment process. In other words, BRIAPI enables business owners to simplify the payment process for customers by integrating everything in one place.

Examples of brands that work with BRIAPI are:

1. Indomaret


BRIAPI offers payment solutions to improve the shopping experience of Indomaret Group customers. Precisely at Indogrosir online. BRIAPI BRIVA products are integrated here because Indogrosir wants to enrich the choice of payment channels for their consumers.

Through BRIVA, Indogrosir consumers can make payments that are safer and simpler. In addition, the system is automatic so they don't need to manually confirm.


2. Tokopedia


BRIAPI is also present at Tokopedia, one of the largest marketplaces in Indonesia.

The API used by BRIVA and Bank Transfer. With this integration, automation and payment processing for transactions in this marketplace becomes faster.

3. Shopee

BRIAPI also supports online transactions at Shopee. Here, BRIAPI facilitates transactional services through BRIVA, Direct Debit, Interbank Transfer, to BRIZZI. Through BRIZZI e-money implemented in Shopee, Shopee users can top up and access BRIZZI through their Shopee account.

4. Doku


Doku is actually a payment gateway that also functions as an e-wallet. Doku is integrated with one of BRIAPI's products, namely BRIVA. So, if consumers want to top up their Doku balance, users can top up their balance via BRIVA, without having to switch applications.


5. LinkAja

Similar to Doku balance top-up, LinkAja users who are also BRI customers can take advantage of BRIVA to complete transactions easily.

6. OVO

BRIVA, which is actually one of BRIAPI's flagship products, can also be enjoyed by OVO users for various purposes while using the super app as well as the digital wallet.

7. Xendit

Xendit provides digital payment solutions. Xendit collaborates with BRI's open banking API, namely BRIAPI. Two BRIAPI products integrated by Xendit are BRI Direct Debit and Transfer Between BRI Accounts.

8. K24Klik

K24Klik is an application where consumers can buy drugs online. This online pharmacy owned by PT K-24 Indonesia is integrated with BRIVA. During this period, the K24Klik application experienced a 200% increase in transactions.



By having a deeper knowledge of payment gateways, you can now steer your business in a more profitable direction by choosing the right option for your business needs.

At the same time, you also show your concern for the security of customer data while transacting at your online store.

And, if you are ready to explore these options, BRIAPI is there as the right solution to grow your business. Secure transactions, enhance your shopping experience and expand your customer base by signing up for BRIAPI now.