the best payment API

Features That a Good Payment API Should Have

December 7, 2022Sandra Wróbel-Konior

Do you know what makes a good payment API that ensures your payment experience runs smoothly? Read on to learn how to select one.  

APIs are used to retrieve data by the majority of modern technology-based enterprises today, as such, they automate critical workflows, offering vast possibilities

As an API works as a middleman between two machines (e.g., different applications), it makes online and mobile transactions much quicker and simpler. You get direct access to the payment-related functions that request payment-card authentication, authorization, fund captures, and refunds — just to name a few.

Payment APIs in Action (For Non-Technical People)

The user performs an action (an API call) that instructs the application on what to do. The application then uses the API to request that the web server complete the action (makes a request). Finally, the user receives the necessary information.

To shed more light on the process, let's look at how a payment API works without using technical jargon.

1. A customer visits your website or downloads your mobile app and decides to purchase a product or service. They need to enter their credit card details on a checkout page.

2. The information is sent to the payment API service along with the transaction details.

3. The card details are sent via card scheme networks to the cardholder’s issuing bank for authorization.

4. The card issuer verifies the card information, such as confirming that the cardholder's account has sufficient funds for the transaction and that the card has not been reported lost or stolen.

5. If everything is in order, the issuing bank authorizes the requested amount and debits the cardholder's account.

6. The API response returns the authorization results to you and the cardholder.

7. The acquirer receives the funds from the card scheme network and deposits the money into your merchant account.

8. You can transfer those funds to your business account automatically.

Now that you understand the role of an API in payment processing let's go over the key factors to consider when selecting a payment API for your checkout process.

1. Flexibility

Flexibility means the ability to create a payment flow based on your programming language, business logic, use cases, and more. This approach allows you operational efficiency and complete control over the payment process.

Examine the services provided by the API to assist you in managing your payments.  For example, if you intend to accept recurring payments, ensure that you can create unlimited plans with different billing cycles or pricing tiers.

2. Robustness

It's critical to simplify the entire process, from integrating the payment system into your website or app to streamlining the purchasing process for customers. You can design the flow to meet your customers' expectations with robust APIs.

Robustness, along with clear documentation, a set of webhooks for all payment events you need, and an easy-to-follow API structure, will make it easy to handle any integration to meet your business needs. Setting up an account and starting to make API calls should be simple. You can run and accept cards within minutes if the system is well-designed.

Examine the performance of features that have an impact on payment processing speed. Is it possible to bundle multiple calls into a single API request? Or is there a webhook system with automatic exponential back-off retries? Make sure you get a response in milliseconds—delays aren't tolerated in payments. Check to see if the payment processor you use can handle the load.

You should pay attention to the user experience. Ensure a simple interface for a complicated process with smart responses for end users on your checkout page.

3. Security

Most processes, including security, can be automated. APIs simplify managing fraud in real-time and accepting payments while ensuring authentication and compliance.

When processing credit cards and sensitive data, you must ensure that the transactions are highly secure and that the entire payment process on your site complies with PCI standards. Check to see if your payment API is secured with an encryption mechanism.

4. Sandbox Mode

You can test the API without implementing the payment solution on your site if a payment provider offers a sandbox environment. You'll get to know the API by going through the entire payment process and seeing how it works from the customer's perspective.

The testing environment is identical to the production platform and you can find simulated card-scheme responses. You may need to generate some test data using the API and make requests with test card numbers to simulate charges, validation errors, disputes, and more.

Testing the checkout page with testing credentials before you go live is the best way to see which payment solution or scenario works best for your use case.

5. Decent Documentation

Another thing that characterizes a good payment API is extensive documentation with clear and concise instructions designed for developers by developers. You need excellent and public documentation with clear examples and solutions for the provided functionality.

Remember that reputable processors provide well-written documentation on their websites, with every method and field explained in human language rather than technical jargon. Having guides that include practical examples and use cases is also beneficial. Look for comprehensive guides that will walk you through the payment system and integration issues.

You need complete reference documentation that is updated whenever changes are made to the API. If the API is poorly described, it should set off an alarm in your head — it’s all about payments.

6. Low Failure Rate

Another consideration for a payment API is stability. Knowing that you can accept and manage mass-volume transactions without interruptions or surprises is comforting. Make sure the payment API is always accessible — you need it to be up and running when your customers make payments on your website.

Examine the amount of time the API is operational and look for a payment platform with near-zero downtime.

7. Responsive support

This is one of the most important but often overlooked factors. Responsive support can do wonders for your business.

Responsive support is equally as important as a robust system. If things go well, you won't need it at all, but it's good to know it's there. Knowing you can follow up on your payments and take immediate action if there are any problems gives you peace of mind.

When running an online business, you need someone to assist you immediately if something goes wrong with your website or app payments. Make sure that a credit card payment provider guarantees that your company will receive assistance as soon as a problem arises.

Choose Payment APIs That Meet Your Needs

When you compare payment providers' APIs, you'll notice that each is slightly different. So, you'll need to know what's most important to you in order to choose the best one for your business. Also, remember that there's a lot you don't need. With this in mind, consider the main functionalities required to meet your company's needs — this will help you make a better decision.

Using a payment API, you may manage subscriptions, take payments, and track user accounts. Before choosing the payment provider with the finest payment API for your project, consider all the above factors.