Alexa Serra  ·  December 14, 2022 

A Guide To Choosing The Best Mobile Payment Gateway For Your Mobile App

Mobile payments are an inalienable part of any modern mobile application that handles monetary transitions. As such, it is crucial for app developers to understand the types of payment gateways out there and know which one works best for their product.

Mobile payments are an inalienable part of any modern mobile application that handles monetary transitions. As such, it is crucial for app developers to understand the types of payment gateways out there and know which one works best for their product.

Imagine you need to get a new winter coat. As many of us lately, you dread physically going to the mall. You simply don’t want to deal with the chaos of traffic and crowded stores that often come with the holiday season. Decades ago, there was no way around it: going to the mall was the only way you could get your shopping done. Luckily now we can have day-long shopping experiences without ever placing a foot outside the door. Ahhh, the beauty of modernity. So, as any respectable mobile phone owner, you open your favorite e-commerce app, start browsing, and jackpot! You found a gorgeous winter coat. You choose your size, add it to your shopping cart, get some other cool stuff that was on sale and get ready to pay. However, to your surprise, the app doesn’t give you the option to pay for your stuff right then and there. Instead, it’s asking you to go to your nearest store or bank branch and deposit the amount so they can get your order on the way. Great, you didn’t want to go outside, and now you have to. Of course, you could deposit the money from your bank app, but that’s beside the point. The point is the e-commerce app doesn’t have a mobile payment gateway. So, would you use that app again? Not a chance. See the importance of implementing the right mobile payment gateway?

In an increasingly cashless world, where most people prefer the convenience of mobile payments, a payment gateway can become the…well, gateway to increased user satisfaction and higher adoption rates. In that sense, no matter the type of app you’re developing, as long as it involves purchasing or selling goods and services and you want to deliver a stellar user experience, you need to implement electronic payments; there’s no way around it. Your users must be able to seamlessly select their items, add them to their cart, hit checkout, and pay; the simpler, the better. So, since we have ample experience developing apps with robust payment capabilities, this time, we want to tell you how to choose the right payment gateway to implement into your application. But first, let’s take a look at what mobile payment gateways are and how they work. Here we go!

What is a mobile payment gateway?

What is a mobile payment gateway?

Last week, on Black Friday, consumers spent a whopping $9.12 billion on online shopping. That’s right, $9.12 billion! This record-breaking figure represents a 2.3% increase in year over year on Black Friday sales, which also outperformed last year’s mobile sales by 4%, with a total of 48% of all transactions conducted on smartphones. Similarly, online consumers spent a staggering $5.29 billion on Thanksgiving day, almost doubling the $2 billion average shoppers spend on any typical day. Can you imagine those figures being what they are if most e-commerce apps and websites didn’t have efficient mobile payment capabilities? They would undoubtedly be significantly smaller, hence the importance of mobile payment gateways for modern IT-based products.

A mobile payment gateway is a technological mechanism that online and e-commerce merchants use to enable the monetary exchange between an application and a user’s preferred payment method, which can be a credit card, debit card, bank transfer, or third-party payment platform. In other words, a mobile payment gateway’s primary job is to gather payment data, transfer funds, and get the merchant paid for its product or service, hence their relevance as the enablers of billions of online transactions worldwide. In fact, it is thanks to mobile payment gateways that the modern digital payments ecosystem flows smoothly, with over two billion users worldwide and 78% of the US population preferring them over brick-and-mortar payment methods. And, if more merchants start to realize the potential that mobile payment gateways have as business propellers and implement them in their digital products, the industry could reach a $43 billion value by 2025, topping that year with an outstanding CAGR of 16.43%!

As you can see, mobile payment gateways are critical to any modern digital business.

They are becoming tantamount to happy customers and increased sales and are at the crux of providing the best possible user experience for online shoppers. As a result, implementing mobile payment methods is a non-negotiable part of owning a mobile app. It’s worth noting, however, that in this article, we’ll be referring to mobile payments conducted on a mobile device via a mobile application, not mobile payments conducted on a website accessed via a mobile device. This is because payment gateways that work on websites, whether accessed via desktop or mobile device, aren’t our primary concern today because we think the overall purchase flow is better when handled through a mobile app. Moreover, since statistics show the prevalence of in-app mobile payments, we believe it’s essential to address the relevance of mobile payment gateways for modern mobile applications and developers.

How do mobile payment gateways work?

How do mobile payment gateways work?

At first glance, a mobile payment gateway works just like a digital cash register; it’s the place where all payments are processed. Obviously, mobile payment gateway transactions are far more complicated than in-person ones, but the essence is the same:

  1. A customer enters your app and starts adding products they like to their shopping cart.
  2. Once ready to check out, the shopping cart takes the customer to the payment page, where they enter their preferred payment information.
  3. After submitting their payment information, they’re directed to the mobile payment gateway.
  4. The payment gateway securely encrypts and sends the customer’s data to their credit or debit card-issuing bank.
  5. The issuing bank then sends the customer’s data to the credit card company (Visa, Mastercard, etc.) for payment authorization or rejection.
  6. The bank then receives that data and either authorizes or rejects the transaction, sending the message back to the payment gateway.
  7. The payment gateway then sends you the message of whether the transaction was approved or denied. If approved, you can collect the order amount from the issuing bank.
  8. The order is fulfilled. Easy peasy.

As you can see, the transaction itself is processed and authorized by the issuing bank, not the payment gateway. What the mobile payment gateway does is act as the front-end technology that collects and transfers the customer’s card information, in real-time, to a merchant’s bank for swift and secure processing. It sounds complicated, but in reality, and when implemented correctly, all the steps mentioned above take place in near real-time. They can happen in as fast as three seconds in part thanks to an application programming interface (API), which allows your app to securely and efficiently communicate with the other parts of the payment processing network. This way, both you and your customers can enjoy smooth transactions in real-time and with all the safety protocols in place.

Types of mobile payment gateways

Types of mobile payment gateways

A payment gateway is pivotal to the payment processing system of your mobile app. However, not all businesses are alike, and choosing the right mobile payment gateway depends entirely on your company, your client, and the needs of both. Therefore, let’s take a look at the different types of mobile payment gateways you can choose from.

  1. Hosted mobile payment gateway
    Hosted payment gateways take your user to their own separate website or portal and away from your app for payment processing. Then, when your customer hits the checkout button, your app uses an API to redirect them to the hosted payment gateway provider’s page. Once there, and depending on which provider you choose, your user either logs in for automatic checkout or fills out their preferred payment information. Afterward, they’re redirected back to your application to finalize the purchase. \ A hosted payment gateway is perfect for you if you don’t want to deal with developing, integrating, and maintaining your own payment scheme. It also has a high-security level, fraud protection, claim resolution services, and deals with compliance requirements. Hosted payment gateways, such as PayPal, are also usually easy to use and have very user-friendly interfaces that make your users’ checkout experiences seamless.

  2. Self-hosted mobile payment gateway
    A self-hosted payment gateway, such as Stripe, doesn’t redirect your user away from your application. Instead, it takes the payment detail form to your application, where your user fills it, you collect their information, and then you encrypt and securely send it to the mobile payment gateway of your choice. This scheme allows you to have complete control over your UX/UI design and makes the user experience and any compliance requirements your responsibility, which depending on your goals, can be a good thing. Moreover, since there’s no redirection to another page and the transaction takes place mostly on your app, a self-hosted payment gateway allows you to provide your users with a faster checkout process.

  3. API-hosted mobile payment gateway
    An API-hosted payment gateway relies entirely on you. You have complete control of the checkout process and handle all the collecting and processing of the user’s payment details. However, this mobile payment gateway needs you to use an API to communicate with the issuing bank and fulfill the transaction. Still, an API-hosted payment gateway is an excellent way for you to design your own checkout experience and integrate it with any tool or device you like. \ If you choose this type of mobile payment gateway, it’s important to remember that you’re responsible for the security of the entire process. So, be vigilant and make sure to design a robust security strategy that helps your app encrypt all user data, use SSL certifications, and ensure that any compliances are met.

As we always say, and as is the case with any choice you make regarding your mobile product, any implementation you decide to add must be made after extensive research. So, deciding which type of mobile payment gateway to use depends entirely on your research, your product’s roadmap, your user’s needs, and your company’s requirements. Still, there are some guidelines that can help you make the right choice. Here are some of those guidelines.

How to choose the best mobile payment gateway for your mobile app

How to choose the best mobile payment gateway for your mobile app

Here are our top recommendations on things to consider when selecting the best mobile payment gateway for your mobile app:

  1. Security
    Did you know that about 55% of online shoppers consider security the most crucial aspect of any digital or e-commerce experience? So, if you want to provide your users with a top-notch shopping experience, you must prioritize security when choosing a mobile payment gateway. As a starting point and to ensure the secure encryption of your users’ financial data, you can choose to work with a PCI-compliant company. The Payment Card Industry Data Security Standard (PCI DSS) is a global apparatus that gathers countless relevant payment stakeholders to design a system of data security standards. These standards are crafted to uphold solid security resources for safe electronic transactions. So, if you choose a PCI-compliant provider, you’ll have the certainty that your customer’s data and payment information are protected. Additionally, make sure your payment gateway of choice uses SSL certificates, 3DS2 security, multi-factor authentication, and tokenization as protective measures for your users’ credit and debit card processing.
    Whichever solution you decide to pull the trigger on, it’s essential you take the time to explore which security measures each provider has so you can make an informed decision on whether they align with your mobile product, your users’ needs, and the overall safety standards of the market. Remember, you must ensure that both you and your users are protected at all costs.

  2. Your product’s needs
    Believe it or not, only some mobile payment gateway providers will be a perfect match for your business. Namely, no matter how popular and user-friendly PayPal is, it isn’t the best match for mobile apps that charge monthly subscriptions, but it is perfect for e-commerce applications. On the other hand, stripe works better with apps requiring social media integration or recurring billing. In addition, different mobile payment gateways support different business goals, handle payment methods and data gathering differently, and have specific features geared toward various business and personal needs. That said, you can opt for a mobile payment gateway that supports as many payment methods as possible and has many integration options with popular devices and digital wallets. This wide array of options can maximize the reach of your application and can expand your potential customer base significantly. Still, regardless of how popular or recognized a payment gateway is, what makes it perfect for you isn’t its notoriety; it’s how well its features match your product’s and your users’ needs. And here’s where your research falls into place. If you take the time to look at the payment gateway market and investigate which providers align with your business goals, then you’ll have an easier time making a good decision.

  3. Ease of integration
    Can you imagine choosing what you think is a great payment gateway and then finding out it doesn’t really fit with your app’s flows? That can quickly become a nightmare for your product’s user experience. So, once again, conducting proper research comes in handy! In that sense, before hiring a payment provider, you must ensure it integrates seamlessly and easily with your mobile app’s existing architecture. Moreover, you must make sure it has SDKs that match your product’s technical specifications and that your developers can understand and easily use. \ In addition, platform and framework standards, API compatibility, and developer documentation are all factors that influence how well you’ll be able to integrate a mobile payment gateway with your product’s needs. Also, if you can easily find clear coding and development instructions, robust libraries, and have access to an efficient customer support team, integrating your app with that payment gateway can be a breeze.

  4. Costs vs. benefits
    There’s no way around it: all mobile payment gateways will have specific pricing models or charge you and your users a fee; after all, that’s how they make a living. The secret here is to find the provider who gives you the best bang for your buck. For instance, if you go with a provider that’s super inexpensive but has very few payment options, no currency diversity, and low-security standards, then you’ll not only be jeopardizing your users’ safety and your reputation, but you’ll also be spending more money, in the long run, fixing flaws. On the other hand, a costly mobile payment gateway provider doesn’t guarantee you’ll be covered on all flanks. So, you must understand what’s included in their plan and what isn’t, and you must also see if what they offer aligns with your app.

Typically, most providers charge monthly fees in addition to transaction fees. PayPal and Stripe, for instance, can charge around 3.9% plus $0.30 in transaction fees plus a fixed monthly price, depending on the payment method and pricing scheme. Some providers, like Braintree, can charge slightly less, while others, like ApplePay, can charge more. In addition, some payment gateway providers can charge additional fees for Amex card payments, and others can even charge more for foreign currency payments, different card networks, or the number of transactions. Moreover, depending on the size of your app and your monthly transaction volume, paying per transaction can become too expensive, so getting a monthly subscription package becomes preferable. At any rate, ensuring you understand the pricing models of your potential mobile payment gateway providers is crucial to making an informed decision and making the best choice for your app.

What are the leading mobile payment gateway providers?

What are the leading mobile payment gateway providers?

Okay, so by now, you’re probably wondering what your actual mobile payment gateway provider options are. Of course, there are many, but keeping in line with our recommendations above, here are the best ones.


Paypal is the market’s most popular payment gateway provider, thanks to its spotless reputation and broad portfolio of services. It amassed a whopping $4.169 billion income in 2021, with almost 20 billion transactions and $1.2 trillion in transaction volume for that same year. It is available almost all over the world, accepts over 26 different currencies and all major credit card providers, and allows users and companies to send and receive payments quickly with just an email address. In addition, it is PCI-compliant and provides fraud protection and a wide array of developer solutions. It also has different pricing models depending on your region, company size, transaction type, and volume.

  1. Cons: PayPal’s fees can be high when compared to other providers. They are also famous for arbitrarily freezing merchant accounts and taking several days to reactivate them, even when you’ve proven you’ve done nothing wrong. Also, their customer service takes too long to respond.


Stripe is a highly customizable cloud-based payment gateway provider known for its speed, trustworthiness, and user-friendliness. Stripe works in almost 40 countries and accepts payments in over 135 currencies. It has over 2 million active users worldwide and is valued at nearly $100 billion. One of Stripe’s most significant advantages is that it has advanced developer tools that make it highly customizable, allowing you to build your own checkout flow. It also provides a custom UI toolkit, excellent security and fraud protection, and an open API that easily integrates your existing app architecture.

  1. Cons: To implement Stripe, you must have some level of development knowledge because it’s APIs and SDKs are somewhat complex to implement. Also, Stripe is only available in certain large countries and is limited to North America, Asia, and Europe.

Apple Pay

Apple Pay is Apple’s mobile payment solution for your e-wallet-loving customers. It provides your iPhone-totting users with a contactless payment option that works for both in-person and mobile purchases and payments. It isn’t a payment gateway in the traditional sense, but it does offer all the benefits that a fast checkout experience brings to your business. Apple Pay is known for being extremely easy to use because it turns a user’s iPhone into a payment terminal itself. It is also very secure because it uses a token-based and anonymous security system that has proven to be very robust. Apple Pay also doesn’t charge any transaction fees and is easily integrated with any mobile app that uses other payment providers.

  1. Cons: Apple Pay only works on iPhone 6 and above, which can significantly impact your product’s adoption and reach. It is also primarily used for in-person contactless payments.


Braintree is a mobile and web payment gateway provider owned by PayPal. It is PCI compliant, handles credit card payments faster than most other gateways, and claims to have one of the most robust security systems in the market. Braintree integrates seamlessly with PayPal, Venmo, Google Pay, and Apple Pay, accepts all major credit and debit card companies, and enables transactions in many different currencies. It charges 2.59% plus 49 cents per transaction with discounts for merchants who report more than $80,000 in monthly sales.

  1. Cons: Users complain about Braintree’s poor customer service. It also requires some technical knowledge to set up, which can be cumbersome if you don’t have prior development knowledge.

Final word

Final word

Thanks to the advent of modern technologies, we now have a myriad of choices at our disposal for payment processing. Contemporary mobile payment gateways are improving and more capable as technologies keep evolving, and modern businesses must stay on top of this evolution to always choose the best option. So, you can make the right choice by having the proper knowledge of how these payment solutions can help your business and understanding the different prices, functionality, security protocols, compliance requirements, and integrations. As a result, you can meet your users’ needs, increase your mobile app’s adoption rates, and position your business to remain competitive and scale as your company grows.

These are some of the main points you must consider when choosing a mobile payment gateway provider. Of course, this isn’t a definitive guide or a one-size-fits-all handbook. You must always conduct your research and select the provider that best fits your and your users’ needs. Still, we hope this guide can give you some direction and can help provide you with some crucial insights to help you make a good decision. However, if you have any further questions or concerns, please get in touch so we can help!

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