Payment Aggregator vs. Payment Gateway

Attribute	Payment Aggregator	Payment Gateway
Definition	Acts as a middleman between merchants and payment processors, allowing merchants to accept multiple payment methods through a single integration.	Facilitates online transactions by connecting merchants' websites to the payment processing network.
Integration	Requires a single integration for merchants to accept multiple payment methods.	Requires a separate integration for each payment method.
Settlement	Aggregates funds from multiple transactions and settles them in bulk to the merchant's account.	Settles funds from individual transactions directly to the merchant's account.
Transaction Fees	May charge higher transaction fees due to added convenience and flexibility.	Transaction fees may vary depending on the payment method and volume of transactions.
Security	Provides an added layer of security by handling sensitive payment data on behalf of the merchant.	Ensures secure transmission of payment data between the merchant's website and the payment processor.

When it comes to processing online payments, businesses have a variety of options to choose from. Two popular choices are payment aggregators and payment gateways. While both serve the same basic function of facilitating online transactions, there are key differences between the two that businesses should consider when deciding which option is best for their needs.

Definition

A payment aggregator is a service provider that allows businesses to accept online payments without the need for a merchant account. Instead, the aggregator processes payments on behalf of multiple merchants through a single merchant account. On the other hand, a payment gateway is a service that securely transmits payment data from a website to the payment processor for authorization and settlement.

Integration

Payment aggregators typically offer a simple and quick integration process, making it easy for businesses to start accepting online payments. This is because the aggregator handles the entire payment process, including payment processing, security, and compliance. In contrast, payment gateways require businesses to have their own merchant account and to integrate the gateway into their website or app. This can be a more complex process that may require technical expertise.

Cost

Payment aggregators often charge a flat fee or a percentage of each transaction, making it easy for businesses to predict their payment processing costs. However, this convenience comes at a price, as aggregators typically charge higher fees than payment gateways. Payment gateways, on the other hand, may have lower transaction fees but may also charge additional fees for setup, monthly maintenance, and other services.

Security

Security is a critical consideration when it comes to processing online payments. Payment aggregators are responsible for ensuring the security of payment data for all the merchants using their service. This means that businesses using a payment aggregator can benefit from the aggregator's security measures and compliance with industry standards. Payment gateways also prioritize security and often offer additional features such as tokenization and fraud detection to protect payment data.

Customization

Payment gateways typically offer more customization options than payment aggregators. Businesses that require specific features or branding options may prefer a payment gateway that allows for greater flexibility in the payment process. Payment aggregators, on the other hand, may have limited customization options as they aim to provide a streamlined and standardized payment experience for their merchants.

Customer Support

Customer support is another important factor to consider when choosing between a payment aggregator and a payment gateway. Payment aggregators often provide dedicated support for their merchants, helping them with any issues or questions related to payment processing. Payment gateways also offer customer support, but the level of support may vary depending on the provider.

In conclusion, both payment aggregators and payment gateways have their own set of advantages and disadvantages. Businesses should carefully consider their specific needs and priorities when choosing between the two options. While payment aggregators offer simplicity and ease of use, payment gateways provide more customization and potentially lower costs. Ultimately, the best choice will depend on the unique requirements of each business.