A payment gateway is a tunnel that connects your bank account to the platform where you need to transfer your money. The software used in a payment gateway authorises you to conduct an online transaction through different payment modes like net banking, credit card, debit card, UPI, or the many online wallets that are available lately. It plays the role of a third party that securely transfers your money from the bank account to the merchant’s payment portal. This involves the authentication of both parties from the banks involved. 

Read in Detail: How Payment Gateway Works?

Some people know what a payment gateway is but do not know its types. To ensure data security during the transaction phase between parties, a payment gateway implements a security system and compliance process that enable strong data encryption. The systems are 2D (2 dimensions secure) and 3D (3 dimensions secure) payment gateways. Let us walk you through the differences between the two to make the pick for your business needs easier. 

What is a 2D payment gateway? 

A 2D payment gateway provides online customers with a checkout interface that enables them to process payments after inputting their basic card details. Customers are required to enter a fixed secure code from the card issuers or the issuing banks (the CVV) after which the payment is processed instantly. The money is deducted from a customer’s bank account once the payment is completely processed.

What is a 3D payment gateway? 

A 3D payment gateway operates similarly to a 2D payment gateway, but with an extra verification step that improves its security. An OTP (one time password) is generated before the amount is deducted from the card holder’s bank account. 

An OTP is a password consisting of random numbers that are generated and sent to the card holder’s mobile phone via SMS, soft tokens, or emails whenever a new transaction has to be made. The OTP is usually valid for a short time ranging from 15 to 30 seconds depending on the provider and the type of service. This extra layer of protection primarily separates 2D and 3D payment gateways. 

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Differences between 2D and 3D payment gateways

2D Payment Gateway 3D Payment Gateway
Full form 2-dimensional secure payment gateway 3-dimensional secure payment gateway
Function Processes payments after cardholders enter their personal card information along with the CVV  Processes payments after the OTP is entered while proceeding with the cardholder information step 
Domains Buyer and online seller Issuer, acquirer, and the payment system


2D and 3D payment gateway are both virtual POSs (Point-Of-Sales), and the way they accept online card payments reflects their pros and cons. But when businesses are scaling up globally, a 3D secure payment gateway is highly recommended to persuade their international customers to make purchases. It is essential because international transactions have risk factors and 3D payment gateways provide higher security than 2D payment gateways.

Razorpay is India’s first full-stack financial solutions company. We are on a mission to enhance the payment experience of over 300 million end consumers. And in doing so, we aim to enable Indian businesses – big and small – to accept payments digitally with minimal effort and maximum ease through our product suite that comprises verticals, along with Payment Gateway, like Payment Links, Payment Pages, Subscriptions, Smart Collect, Route, Razorpay Capital, RazorpayX, and Payroll.

Signup with Razorpay and find out how our software can upscale and grow your business to elevated heights today!

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