A payment gateway is the technology that securely captures and passes card or other payment details from a customer to the systems that authorise and process the payment.
General information, not financial, legal, or tax advice. Verify current terms and eligibility with the provider before applying.
How a payment gateway works
A payment gateway is the service that captures a customer's payment details and moves them securely through the steps needed to authorise a payment. When a customer pays on a website or at a card terminal, the gateway encrypts the card details and sends them to the acquiring bank and the relevant card scheme, which check the card and return an approved or declined response. The gateway passes that result back to the merchant within seconds. It handles the secure transmission of data rather than holding the money itself, current as of 24 October 2025.
Payment gateway and merchant account
A payment gateway and a merchant account do different jobs and are often used together. The gateway is the technology that securely captures and transmits the payment details and returns the authorisation result. The merchant account is the account where funds from approved card payments are settled before being paid out to the business's main bank account. Some providers bundle the gateway and the merchant account into a single service, while others supply them separately, so a business may deal with one provider or several depending on the setup.
Why it matters to a business
For a business that accepts card or online payments, the payment gateway affects which payment methods it can offer, how secure the checkout is, and what it pays in fees. Gateways differ in the cards and wallets they support, the currencies they handle, how they integrate with a website or point of sale system, and their pricing, which may be a per transaction charge, a monthly fee, or both. Because handling card data carries security obligations, a business should check that a gateway meets the relevant card industry security standards and confirm current fees and supported methods with the provider.
Frequently asked questions
What is a payment gateway?
What is the difference between a payment gateway and a merchant account?
Does a payment gateway hold my money?
What should a business check when choosing a payment gateway?
Definitions, fees, features, and eligibility change and vary by region. This page was last reviewed on 24 October 2025. Confirm current terms with the provider before applying.