Choosing the Right Payment Gateway for E-commerce

If you are in the process of setting up a business in Indonesia with online payments, choosing a local payment gateway is a must. Even though the electronic transaction is growing along with the fintech ecosystem, choosing the right payment gateway for e-commerce is a different thing. Here are some tips to help you make the right choice.

Time is money

What’s the point of hiring a payment gateway if it doesn’t make your business run faster? Make sure the payment gateway’s integration doesn’t waste your time so you can focus on what matters: starting your business. We’ve heard some horror stories where you get set up on the payment gateway only to have to wait for them to go live. Once the setup is done, it is also important to know how quickly you can start accepting payments and receiving funds from your sales. It would be helpful if the payment gateway provides real-time notification via API in order to receive and send money instantly.

Some good questions to ask as you search:

  • Do I need to negotiate with each bank individually or can one negotiation with the payment gateway work across all the banks?
    Hint: most payment gateways will require you to negotiate with the bank or wait a month while they do it for you. In our case, we have aggregation agreements so you just negotiate once with us and you’re ready to go
  • How fast can we go live?
    Hint: most payment gateways require a few painful processes to go live, e.g. a bank needs to approve your MID for credit cards. With Xendit, it’s immediate – as soon as you’ve integrated you can go live.
  • How long does it take to integrate?
    Hint: get your developers to check out their API documentation. Xendit’s fastest integration was within 2 hours.
  • What accounting software do they integrate into?
    Hint: many haven’t invested time here. Xendit has, and it means you can have automated payments accounting which makes your life significantly easier over manual journal entries.
  • Settlement time
  • Customer and technical support

Money matters

Different payment gateways have a different fee structures and should be transparent up front. Payment gateways usually charge transaction fees, monthly fees, and/or setup fees. Before committing to any payment gateway, make sure there is no hidden fee or surprise charge that makes you end up paying more than what you bargained for. Also make sure to ask for the total in cost fee. Their fees may look lower but then you need to pay the bank fees. It would be great if the payment gateway allows you to try their service on your e-commerce first.

Here at Xendit, we charge only 1 set of fees, our cost per transactions. These are all inclusive, we pay the bank charges. We don’t charge any monthly hidden fees, maintenance fees or setup fees.

It helps you feel confident about the gateway you choose and an opportunity to learn about the different charges you must account for especially if you want some tweaks. Some payment gateways cost a lot just for direct integration, but Xendit doesn’t charge you any more for this work. In fact, Xendit gives you 30 days free with fully fledged features, full support, and a seamless transition to upgraded account.

A good question to ask as you search:

  • What’s the fully loaded cost per month of my transactions?
    Hint: check for setup, maintenance, monthly and bank fees added on top. Many PGs are not transparent about these costs. Xendit always is.

Hosted versus non-hosted

A hosted payment gateway is more suitable for a small-medium enterprise that requires an instant and cost-effective way to accept card payments. It will redirect customers off your page to their securely ‘hosted’ payment page. Once the payment has been made, customers will be returned to your page and have their order confirmed. The perk of this option is that the offsite provider is responsible for all PCI compliance and data security. On the other hand, directing customers off your page means you don’t get to fully control the UI

A non-hosted or integrated payment gateway links your e-commerce page via API provided by the gateway. The benefit is that customers never have to leave your e-commerce page to input payment information and submit their orders. An integrated payment gateway gives customers a smooth and seamless shopping experience in your store. However, the setup of gateways integrated via API can be time-consuming and more difficult. Hence, it is critical to choose payment gateways with high standard APIs and one that is customizable like Xendit. Xendit does little change to meet e-commerce’s specific use cases. The development team is ready to help your e-commerce get up to speed with just 3-5 days integration.

Some good questions to ask as you search:

  • Does the payment gateway offer a hosted page?
  • Does the hosted page contain their branding or can it have yours?Hint: Some PGs try to force their branding everywhere. We believe in making you look good, not us so we only have our details for customer support.


Methods of payment

Indonesia’s customers are unique. The World Bank Global Findex reported there is only 1.6 percent of adult Indonesians having a credit card even though 36 percent of Indonesians have a bank account with a formal financial institution. In addition to that, internet and mobile banking have become more popular. Therefore, it is important to make sure the payment gateway for your e-commerce is able to accommodate all of them. Xendit helps you to accept payments from various methods of payment such as bank transfer, virtual account, and credit card.

Some good questions to ask as you search:

  • What payment methods does the payment gateway have?
  • What plugins do they offer and is it compatible with your version of X?Hint: Even if someone has a wordpress plugin it may not work for your version. Get proof it can before committing.

Fraud detection systems

If you’re dealing with credit cards you’ll want to be using some sort of fraud detection system. Good payment gateways should have this by default and be able to provide it to you to lower your chargeback risk. All payments at Xendit are securely protected by the same fraud detection systems used by Visa.


Some good questions to ask as you search:

  • How does the payment gateway execute fraud detection?
    Hint: You’ll want to hear that they can take in inputs from your transactions to feed into their fraud models. If they can’t take in data, how can they be building a good system? Some information can be gained from transactions but as you grow you’ll want the option to input your own data to drive fraud decisions.

Customer support

It is increasingly common for payment getaways to offer email support only. However, e-commerce is a 24/7 experience. That is why the right payment gateway for e-commerce should offer reachable and responsive support when you need it most. If email support is not the appropriate level of customer support you need, it would be better to choose a gateway with telephone or chat support which is far more responsive.

Some good questions to ask as you search:

  • What are the operating hours of customer service?
    Hint: Most do Mon-Fri 9-5pm. Xendit does 8am – 10pm, 7 days a week, even on public holidays,e.g. Lebaran and Christmas
  • Then actually try and send a random support ticket. See how long it takes to reply.
    Hint: Compare Xendit to other payment gateways. We consistently hear we have better responsiveness than other payment gateways.


Security has never been overrated, especially when it comes to card payment data. Make sure you keep up with the 3.0 version of the Payment Card Industry Data Security Standards (PCI-DSS). It helps your e-commerce and the payment gateway to implement standards for security policies, technologies and ongoing processes that protect your payment systems from breaches and theft of cardholder data. All payments at Xendit are securely protected by the same fraud detection systems used by Visa. All sensitive data is encrypted in transit and at rest, and all payments are processed on PCI DSS compliant system. It’s not an exaggeration to say that your e-commerce is protected with security standards used by banks, governments, and Silicon Valley.

We understand that choosing the right payment gateway is very important to make sure your e- commerce business stays on top of all transactions in Indonesia. With the right payment gateway, your business no longer need to worry about processing payments and can finally focus on delivering superior goods and services to customers.

But not all payment gateways are created equally. Each one has its own strengths and weaknesses. Talk to each player in Indonesia and you will find reason to work with each of them based on different use cases and priorities.

If you have some questions about navigating the various payment gateways in Indonesia, we can help. Please feel free to ping us over online chat, WhatsApp, or emails, we’d love to help out.


Written by Tika Widyaningtyas for Content Collision and Xendit.