Payment switch facilitates transactions by transferring key information between payment portals such as web-enabled mobile devices/websites and the front end processor/bank. NanoBNK payment switch platform integrates with over a dozen payment switch throughout the world. As your business scales, add or change payment switch partners. Our products ensure payment routing to specific switch for each market, currency or payment method. We offer many payment processing options to serve the needs of your business. Payment switch fulfills a vital role in the e-commerce transaction process, authorising the payment between merchant and customer. At NanoBNK we take full charge ensuring seamless payment transaction.
About Payment Switch
Payment Switch is a complex fabric in which functionality and technicality are intricately woven to provide a solid platform to deliver ever increasing the different type of payment services with high throughput & resilience.
From 10000 Feet view, it might seem that “PS” is a generic platform used to transform and route different kind-off payment messages for authorization. But as we climb down the chain we can see different payment services, multiple components and complex technical components and frameworks to support payment services.
The payment switch core functions
A Payment Switch can be thought of as aanindependent entity that facilitates communication between different providers. The payment gateway talks directly with the switch to process payments.
The payment switch performs the following core functions
- Manages direct integrations into the payment providers – the payment switch understands the individual requirements of each payment provider (e.g APIs, file formats etc) that it supports and defines a common interface for communication with that provider. It also manages merchant’s configurations with a particular provider.
- Manages 3D SecureMPIs –
- Facilitates processing of real payments between these providers – It accepts request for a payment, understands which providers it needs to process with, formats the message for that provider and sends it to them, gets response, changes the response to a generic format and send the response back to the caller.
The revolution of the payments industry
Payment Services: Gone are the days when switch was only supposed to process Credit Card (CC)/ Debit Card (DC) authorization transactions.
- Loyalty / Prepaid: As a part of authorization transaction or individual transaction, based on loyalty/prepaid service switch should be able to perform desired functionality like amount load, point addition etc.
- Wallet: Wallets are becoming an intricate part of mobile based financial transactions and they are being used for multiple purposes starting from remittance to bill payments to service recharges etc.
- Value Added Services (VAS): Services like insurance, health, premium payment, recharges, immediate payments.
- Token Vault: Secure and compliant token vault services for the safe-keeping of sensitive data like card number.
- Merchant Services: Merchant onboarding (+management), charges & billing, batch closures.
Supporting Services: To support different payment services, additional services are required.
- Fraud Detection: Checking and identifying fraudulent transactions and raising RED flag based on configured parameters.
- Device Management System: Integration and handling of both POS and ATMs. handling).
- Key Management: HSM integration into Switch at required functional points. Key handling, key rotations, key sharing etc.
- Reconciliation and Settlement: Recon and settlement is important functionality for both end-points of switch – Processor & Merchant
- Dynamic Currency Conversion: To support foreign currency transactions, currency conversion based on exchange rates is a required feature.
Moving further down, service components are defined. Payment Services consume service components directly or via Supporting services. Above mentioned abstract layering is just an “VIEW” of different type of services/components.
The second aspect of switch, i.e., technology is equally important otherwise it becomes next to impossible to provide payment services in a consistent manner.
From architecture and design view point Payment Switch has to be high performance system besides highly resilient and available. This aspect makes PS technically challenging.
To support transactions with TPS of 10000 and more and provide high-availability at different level of system is not a simple task. Lot of architecture design patterns, integration methodologies are available to solve the NFR (non-functional requirements) of switch.
Load and Performance: High end switch has to handle simultaneous tens of thousands of ATMs and POS device and they have to ensure zero or less degradation in performance. Earlier ATMs, used to maintain connection with switch for long durations, which is again a huge bottleneck.
Solution of payment switch brings to you
Solution of payment switch comes primarily in 2 variations:
- Combination of hardware and software like HP Non Stop, Stratus. TCO becomes significantly high in this case.
- Scale out Architecture: Using commodity hardware and software. Depending on load requirement, server farm can be scaled out.
High Availability: Being a “financially” sensitive system, any downtime (crash) of switch results in financial loss. HA needs to be maintained from multiple perspectives: Inside Data Centre, Primary DC -BackUp DC, Primary DC – Primary DC.
Factors like latency (both inside DC & between DCs), scheduled/non-scheduled maintenance time, patch deployment, self-healing etc. matters lot in production environments.
Resilience: The expected (both functional and technical) behavior of switch under varied conditions & zero transaction loss in any case. Especially, behavior under crash & no response from components (component is live but not responding).
Tendency towards conversion for Spaghetti Architecture: Mostly payment systems have to integrate with multiple external systems for data posting, validation, authentication, data reporting etc. Its results in supporting various formats, transmission protocols, communication protocols and most importantly multiple invocation points inside transaction life-cycle.