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How can i develop my own payment gateway like Paypal?

Discussion in 'Payment Processing' started by i_am_dhaval, Mar 15, 2012.

  1. #1
    How can i develop my own payment gateway like Paypal?
    SEMrush
    CAN ANYONE GIVE ME guideline ?
     
    i_am_dhaval, Mar 15, 2012 IP
    SEMrush
  2. jestep

    jestep Prominent Member Premium Member

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    #2
    There is no guide. You basically need to establish relationships with a bank that will allow an aggregating merchant account. Next build a software system that can facilitate the transfer and storage of money between individuals and businesses. Realistically it would cost millions of dollars in licensing and development just to get a foothold. There's a reason that Paypal has no real competitors.
     
    Last edited: Mar 15, 2012
    jestep, Mar 15, 2012 IP
  3. MerchantServicesBDM

    MerchantServicesBDM Peon

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    #3
    A payment gateway and a payment processor are two different things. A payment gateway, like Authorize. Net, allows a website or software to send payment information to a payment processor to process the payment. The payment processor does the actual handling of the payment (e. g. checks to see if funds are available on the card, is it approved, AVS, CVV verification, etc).


    To build a payment gateway you have a lot of work ahead of you. This isn't a project you would write with a language like PHP. You would need to use a higher level language such as C or C++. Something compiled that will be much faster and more robust then PHP. You can power your web based front end with PHP (i. e. user control panel) but the backend stuff, including payment processing, will need to be in the higher level language. You'll also need an enterprise level database as open source databases could never handle a task like this. Basically you're looking at using an Oracle database which is expensive but also designed for this sort of thing.


    Your first major issue will be PCI DSS compliance. But since you're aware of that we'll skip the details of it.


    Your second major issue will be getting certified by the processing networks. To be a successful payment gateway you must be certified on every processing platform and there are at least 16 of them that I can think of off of the top of my head. Being certified takes about two months for each. You can do them simultaneously but you would be looking at at least a year to be certified on all of them. And each one has a different API so you will need to code your payment gateway to work with all of them.


    Your third major issue will be the data you store. Not only do you have the PCI DSS issues to deal with, but you will need to capture and store every transaction that runs through your system for years. That kind of data will require tons of storage space (that will also need to be secured).


    Your fourth major issue will be processing volume. A gateway must be able to perform transactions in a second or less. This means your hardware solutions must be able to scale for heavy traffic especially over the holiday season. It will need to be able to handle hundreds of transactions per second (thousands if you become successful). That is a big reason why you'll need to use a higher level language over PHP.


    Your fifth major issue is that you will need to create a powerful yet easy to use API for web developers to use to connect to your payment gateway. They need to be able to do everything a credit card terminal can do through code. Documenting that should be fun!


    Minor issues include:


    - Making sure you are ECI compliant (Electronic Commerce Indicator is required for all Internet transactions)


    - Securing all data transfer (SSL)


    - Offering a user control panel


    - If you want to be successful you will also need to have anti-fraud tools available


    Building a payment processor is an even more herculean task. It will require relationships with banks (a friend just went through this process for their new venture and it took over a year just to get a bank to agree to work with them). I suspect it will require you having a lot of money set aside to deal with potential processing issues that result in your customers being owed money. I'm talking at least six figures.


    The technical stuff would be at least as complex as building a payment gateway. You'll need to be interfacing with banks. Lots of them. And your uptime must be 100%. I have not been this deep in the technical aspects of it all so I can't give you anything more specific then that.


    The payment gateway is a huge project but doable. It becomes easier if you limit the networks it will work with. Maybe stick to the most popular to start and go from there. A better idea might be to partner with a processing bank and sell merchant accounts through them. Then make your payment gateway work only for them at first. Then you can launch quicker and also make money on the credit card processing. The payment processor part is huge and probably beyond the scope of what you want to do. If not, it's a huge undertaking that goes way beyond three programmers. You're gonna need lawyers, too.
     
    MerchantServicesBDM, Mar 15, 2012 IP
    samazgor and ashtakshara like this.
  4. i_am_dhaval

    i_am_dhaval Well-Known Member

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    #4
    is asp.net is good then PHP to develop this type of system?
     
    i_am_dhaval, Mar 15, 2012 IP
  5. Card

    Card Well-Known Member

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    #5
    How much funds you are investing to build your payment gateway?
     
    Card, Mar 15, 2012 IP
  6. i_am_dhaval

    i_am_dhaval Well-Known Member

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    #6
    Fund Is not issue at this time..i need to collect all info then i need to finalize cost :)
     
    i_am_dhaval, Mar 16, 2012 IP
  7. jestep

    jestep Prominent Member Premium Member

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    #7
    You would most likely want to write it in something more stable like Python or Perl. I wouldn't even consider using ASP or any Windows based platform.

    The coding is the easy part. Establishing the proper relationships is what's going to be difficult and expensive.
     
    Last edited: Mar 16, 2012
    jestep, Mar 16, 2012 IP
  8. matrak104

    matrak104 Peon

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    #8
    I think it is not so easy that you think. You need a crew at first. Then good relationships with powerfull banks. If you are not rich forget this :)
     
    matrak104, Mar 17, 2012 IP
  9. i_am_dhaval

    i_am_dhaval Well-Known Member

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    #9
    Dear Friend There is not a quetion about Rich or Poor.

    If i think i want to do this then i can do any thing....

    I am always see Big Dream...And I am sure one day i will do all my Dream...

    Always Think Positive ....

     
    i_am_dhaval, Mar 17, 2012 IP
  10. satguy

    satguy Active Member

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    #10
    @ MerchantServicesBDM

    That was a very nice post. Thanks...
     
    satguy, Mar 17, 2012 IP
  11. RAVI63

    RAVI63 Peon

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    #11
    yeah,, thats so big dream :)
     
    RAVI63, Mar 17, 2012 IP
  12. Forumwatch

    Forumwatch Member

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    #12
    "IF" you ever get it up and running do not underestimate the cost of marketing. People will not simply, switch use or trust a new paypal competitor.
    2c
     
    Forumwatch, Mar 17, 2012 IP
  13. michaelyx

    michaelyx Member

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    #13
    You have to have a something good to get people from competing sites to yours remember that...
     
    michaelyx, Mar 18, 2012 IP
  14. Amit_R

    Amit_R Member

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    #14
    well its a huge Idea.. good Luck...
     
    Amit_R, Mar 22, 2012 IP
  15. i_am_dhaval

    i_am_dhaval Well-Known Member

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    #15
    what is rule of RBI for start payment gateway in india?
     
    i_am_dhaval, Jul 4, 2012 IP
  16. fionix

    fionix Well-Known Member

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    #16
    Good luck with your venture. As mentioned here, it requires a lot of money, staff and knowledge to get such a thing going. The banking relations required are the hardest to get at all. With no experience in this business no one will ever touch you.
     
    fionix, Jul 4, 2012 IP
  17. INDIAN123

    INDIAN123 Active Member

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    #17
    ask reserve bank of india for that
     
    INDIAN123, Jul 17, 2012 IP
  18. dir18

    dir18 Active Member

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    #18
    In India you need a "Gandhi Ji" - All in one rule :)

    Do you have a power + money to open a bank in India? If you hold peoples money for more then 1 week then RBI Acted you as a Bank..
     
    dir18, Jul 20, 2012 IP
  19. i_am_dhaval

    i_am_dhaval Well-Known Member

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    #19
    is it possible i will register company in usa and start payment gatway in easy way then india?
     
    i_am_dhaval, Jul 22, 2012 IP
  20. Qurar

    Qurar Member

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    #20
    if you want Paypal Then Go In YOur Paypal Account Or If you want Any Bank account payment Getway Then You can contact Bank...
     
    Qurar, Jul 22, 2012 IP