Payment Links vs Payment Gateways: Which Is Right for Your Business?
Understanding the difference between payment links and payment gateways helps businesses choose the right solution for accepting card payments. Both enable electronic payments, but they serve different needs and require different levels of technical involvement.
This guide explains how each option works, their advantages and limitations, and which scenarios favor each approach.
What Are Payment Links?
Payment links are URLs that direct customers to a hosted payment page. The business creates a link specifying the payment amount, and customers click to enter their card details and complete the transaction.
How payment links work:
- Business creates a payment link through a dashboard or app
- Business sends the link to the customer via text, email, or WhatsApp
- Customer clicks the link and sees a secure payment page
- Customer enters card details and confirms payment
- Business receives notification of successful payment
- Funds settle to the business bank account
Payment links require no coding, no website, and no hardware. The payment provider hosts the entire payment experience.
What Are Payment Gateways?
Payment gateways are software interfaces that process card payments within your own website or application. They require technical integration but offer more control over the payment experience.
How payment gateways work:
- Business integrates the gateway API into their website
- Customer adds items to cart and proceeds to checkout
- Payment form collects card details (hosted by gateway or embedded)
- Gateway processes the transaction with card networks
- Business receives confirmation via API response or webhook
- Funds settle to the business bank account
Payment gateways require development resources but enable seamless checkout experiences within your own platform.
Key Differences Between Payment Links and Gateways
| Aspect | Payment Links | Payment Gateways |
|---|---|---|
| Technical skill required | None | Developer needed |
| Setup time | Minutes | Days to weeks |
| Website required | No | Yes |
| Customization | Limited | Extensive |
| Customer experience | Redirected to payment page | Stays on your site |
| Best for | Service businesses, invoicing | E-commerce, subscriptions |
| Recurring payments | Limited | Full support |
| Cost structure | Per-transaction | Per-transaction + possible monthly |
When to Use Payment Links
Payment links work best for businesses that:
Accept payments occasionally or irregularly. If you process a few payments per week rather than hundreds per day, payment links provide simplicity without infrastructure costs.
Operate without a website. Service businesses like salons, freelancers, and consultants often book via phone or messaging. Payment links integrate naturally into these workflows.
Need to collect deposits. Appointment-based businesses can send payment links when customers book, securing deposits without complex systems.
Invoice for completed work. Contractors, photographers, and service providers can include payment links in invoices for immediate payment.
Want to start accepting cards quickly. Payment links can be operational within minutes, with no development work required.
Serve customers remotely. When customers are not physically present, payment links enable card collection without shipping hardware.
Payment Link Use Cases
- Salon collecting deposit when customer books via WhatsApp
- Freelancer sending invoice with payment link attached
- Tour operator accepting booking payment via email
- Consultant collecting retainer before starting work
- Fitness trainer accepting payment for session packages
When to Use Payment Gateways
Payment gateways work best for businesses that:
Operate e-commerce websites. Online stores need integrated checkout experiences where customers can browse, add to cart, and pay without leaving the site.
Process high transaction volumes. Businesses handling hundreds or thousands of transactions benefit from automated, integrated payment flows.
Need recurring billing. Subscription businesses require gateway integration to charge customers automatically on schedule.
Want branded checkout experiences. Gateways allow customization of payment forms to match your brand and reduce cart abandonment.
Require complex payment logic. Split payments, marketplace payouts, and multi-party transactions need gateway-level integration.
Build mobile applications. Apps require SDK integration rather than link-based payment flows.
Payment Gateway Use Cases
- E-commerce store with shopping cart checkout
- SaaS company billing monthly subscriptions
- Marketplace splitting payments between sellers
- Mobile app accepting in-app purchases
- Membership site managing recurring dues
Technical Requirements Compared
Payment Links
- Account with payment provider
- Mobile phone or computer to create links
- Way to send links to customers (text, email, WhatsApp)
No coding, no website hosting, no SSL certificates required.
Payment Gateways
- Account with payment provider
- Website with SSL certificate (HTTPS)
- Developer to implement integration
- Server-side code to handle API calls
- Webhook endpoint to receive payment notifications
- PCI compliance considerations for card handling
Gateway integration typically involves:
- Generating API keys from the provider dashboard
- Installing the provider's JavaScript library
- Creating a payment form or checkout page
- Calling the API to create payment intents
- Handling success and failure responses
- Processing webhooks for asynchronous events
Cost Considerations
Both payment links and gateways typically charge per-transaction fees, usually 2.5% to 3.5% plus a fixed amount per transaction.
Payment links generally have no monthly fees, making them cost-effective for low-volume businesses.
Payment gateways may have monthly fees, setup fees, or minimum transaction requirements. However, per-transaction rates may be lower for high-volume merchants.
Calculate your expected transaction volume and average payment size to determine which cost structure works better.
Hybrid Approaches
Many businesses use both payment links and gateways:
- Website checkout uses gateway integration for seamless e-commerce
- Phone orders use payment links sent via text or email
- Invoicing uses payment links embedded in invoice emails
- Deposits use payment links for booking confirmations
This hybrid approach captures the benefits of both methods.
Security Considerations
Both payment links and gateways handle card data securely when provided by reputable processors.
Payment links keep card handling entirely with the payment provider. Your business never touches card numbers, simplifying PCI compliance.
Payment gateways can be implemented with hosted payment fields that also keep card data off your servers. However, improper implementation can create security risks.
Choose providers that are PCI DSS compliant and use tokenization to protect card data.
Making the Decision
Choose payment links if:
- You have no website or technical resources
- You need to start accepting payments immediately
- Your business model involves invoicing or deposits
- Transaction volume is low to moderate
- Customers book via phone, text, or messaging apps
Choose payment gateways if:
- You have an e-commerce website
- You need recurring billing capabilities
- Transaction volume is high
- You want branded, integrated checkout
- You have development resources available
Consider both if:
- You have a website but also take phone orders
- You want flexibility for different payment scenarios
- You serve both online and offline customers
Tools That Support Both Approaches
Many payment providers offer both payment links and gateway APIs:
- HandyPay provides payment links for service businesses and an API for website integration
- Stripe offers Checkout (hosted) and Elements (embedded) alongside payment links
- Square provides both point-of-sale and online payment options
Choosing a provider that supports both gives flexibility as your business evolves.
Frequently Asked Questions
Can I switch from payment links to a gateway later?
Yes. Many businesses start with payment links and add gateway integration as they grow. Choose a provider that offers both to simplify the transition.
Are payment links secure?
Yes, when using reputable providers. Payment links direct customers to PCI-compliant hosted pages that handle card data securely.
Do payment links work for recurring payments?
Limited support exists. Some providers allow saving payment methods for future charges, but full subscription management typically requires gateway integration.
Can customers pay with any card type through payment links?
Most payment links accept major card networks (Visa, Mastercard, American Express) and may support digital wallets like Apple Pay and Google Pay.
What happens if a customer does not complete payment?
The payment link remains valid until it expires or is cancelled. You can send reminders or create new links as needed.
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