How Ecommerce Works

Three Things are Necessary for Online Payment



A Merchant Account - A business account with a bank that allows for online transactions. This is where your online payments finally end up. It is not the same as a regular bank account. It is a special kind of bank account.


A Shopping Cart - Allows for online display of your products and provides a method for the user to make selections.


Gateway (Transaction Server) - Connects the shopping cart with a processing network which checks for the necessary funds and either authorizes or denies payment.


All transactions are encrypted to protect sensitive information (including the buyer's credit card number).

"Encryption" is a process by which the information is converted into a form that cannot be easily understood by unauthorized people. Encryption is essentially a way to "code" the information before it is transferred over the internet. Once the information is received at its final destination, it is decoded, or "decrypted."

Before you invest in an online store or an e-commerce solution, consider your ROI (return on investment): a simple Paypal solution may be all you need to start selling your product or service online.