A payment gateway is a software program that does the same thing as a POS device, just online. Instead of a swiper, a gateway receives the card information manually through a keyboard, then encrypts and sends it into the same system of electronically transferred information that a POS device uses. If you have ever paid for anything online using a credit card, you’ve used a gateway.
To accept credit card payments online you will need an internet merchant facility and a payment gateway. A merchant facility allows you to accept payments online while the gateway provides the connectivity to the payment processing networks. Sometimes they are bundled together, but in most cases they are sold separately. Most gateways have an API for web transactions as well as a web based portal for phone or mail orders.
Payment Gateways never touch the processed funds and only act as the secure connection to the payment networks. Processed funds will appear in your designated clearing account usually the next business day, however you can expect delays of 2-3 days. Amex transactions can take up to 5 days to clear as they are processed differently to Visa and MasterCard.
While a gateway can help you process credit card transactions securely, it does not remove all your PCI requirements.