Indian digital payments market is forecasted to grow five-fold by 2023 to more than $1 trillion.
With the growing number of people adopting digital payment alternatives from all walks of life, the on-going digital transformation of India has been simply exceptional. As a consequence the Indian digital payments market, currently clocking around $200 billion, is forecasted to grow five-fold by 2023 and be worth more than $1 trillion according to a Credit Suisse report. To put this number into perspective, that amount equates to almost 50% of India’s current GDP.
But digital transactions, despite the comfort and convenience that they bring in our day-to-day lives, are increasingly a target of the cyber threats prevailing in the digital ecosystem. Thus, with India’s growing adoption of the digital payments, let us have a look at how payment gateways are helping to protect against the underlying cyber threat.
Sirish Kumar, Founder and CEO for Telr, explains:
When you make a payment on a website, it gets processed by a payment gateway in a matter of seconds. A set of complicated processes take place during this time to ensure the end-to-end security and certainty of the transaction. We will delve into these processes, but first, let us understand what payment gateways are.
Payment gateways are an essential part of the e-commerce landscape: sitting between a merchant’s website or app and the payment source (such as a card network or an online bank account), they provide the technology that allows the merchant to accept payments online.
A quarter of the world’s population has used a payment gateway at one time or another, transacting online. For example, when you enter your card details into a form as you make an online transaction, you are interacting with a payment gateway. The payment gateway securely records your details from the form and sends them to your bank for processing – and then when an approval comes back from the bank, the payment gateway lets the website know, and your transaction can be completed.
Payment gateways can be easily branded as reliable sentinels in the realm of digital transactions. There are two main angles to how payment gateways ensure the security of our payments, and protect against any type of digital fraud marring our digital experience:
-Data Analysis: Data from every aspect of the transaction is analysed by the payment gateway, to identify signals that might indicate that the transaction is fraudulent. This transaction data is also overlaid on top of data from banks and card networks such as Visa and MasterCard, and with data from other sources, to build a multi-layered picture of the characteristics of the transaction. This serves two purposes – firstly it means that fraudulent transactions are more accurately identified, protecting both online merchants and their customers. Secondly, genuine transactions are not incorrectly identified as being fraudulent, which minimizes the risk that the merchant is losing revenue by turning away legitimate transactions.
-Data Security: Payment gateways use a number of methods to keep their merchants’ customers’ payment details completely secure and safe from theft. From security protocols in websites, to PCI DSS certification (an information security standard adhered to by payment gateways that ensures that payment gateways build and maintain secure networks and systems to protect cardholder data), the mission of payment gateways is to safeguard data at every step of an online transaction.
In the moments that it takes for a payment gateway to process a transaction, cutting-edge protections are being applied. This keeps the merchants, their customers, and their data safe from fraudulent activity. So, as India increasingly helps shape the digital age, payment gateways play a pivotal role in keeping the participants in the digital economy safe and secure. This in turn builds the trust in the use of online channels for daily transactions – a critical component of our digital future.