Is it possible to Develop a payment gateway

1.8k views Asked by At

So this question isn't about integrating an existing payment gateway into my site. This is more of a architectural question.

I want to build a system similar to Paypal. Now I understand that Paypal offers a lot of features under the roof and I can't implement all of them at once. I want to implement the core functionality of Paypal and other such services.

So my question is (rather discussion is) around how would one go about building such a system. Some points to discuss:

  1. Allow users to securely store and process their payments How does Paypal handle the transactions?
  2. Handle payments through existing banks. I am guessing that I would need access to local bank protocols to get this.
  3. Where I can find documentation of paypal or any other payment gateway to get the idea of its core functionality

Thoughts?

1

There are 1 answers

1
pierre On

If you want to directly integrate with banks, you want to become a payment processor. This is quite hard to achieve (especially on the compliance side) and the market is dominated by a few giants (First Data Corp., Total System Services Inc. (TSYS), Vantiv Inc., Global Payments Inc. and Heartland Payment Systems Inc.).

A payment gateway however is a system that accepts card payments, and offers value added services such as recurring payments. Gateways (unless they are a processor themselves) most often delegate the actual processing of the cards to a payment processor.

Becoming a gateway is easier and you can even partner with ISOs which will provide you with white-labeled solutions (e.g. Intrix). You can also take a look at Kill Bill for an example of an open-source payment gateway.

Regarding security, if you want to minimize PCI compliance, you can delegate the actual storage of the card to online vaults.