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What is a checkout API, and do you need it?

The United Kingdom (UK) has a highly sophisticated e-commerce market that is considered Europe’s most advanced. As of December 2023 figures, Statista has estimated that there are over 60 million online buyers in the UK, indicating that only a minority of the population are considered non-digital buyers.

With the industry’s value estimated at around £2,089.6 billion, it’s clear that ecommerce stores are booming. For those of you considering entering this lucrative industry, you need the right solutions to accept payments safely and securely. That is where the importance of a checkout application programming interface (API) takes centre stage.

In this article, we cover what a checkout API is and what it does, how the process of accepting online payments with an API works, when you should implement it, what requirements need to be fulfilled, its advantages, and the factors to consider when choosing your checkout API. Let’s begin.

What is a checkout API, and what can it do?

Before we cover what a checkout API is, we will first give you a broader understanding, shedding more light on APIs. If you run an online store, you know that two computers are involved in the sale process. It includes your computer, which contains your items for sale and the customer’s computer, which is where they browse your products and select something to purchase.

When it comes to an API, you can think of it as a type of “translator” that speaks the language of both computers and connects them so that they “speak” to each other. In the context of checkout APIs, the communication process takes place when payments are made on a secure payment page or checkout page.

However, checkout APIs are not limited to accepting payments only. Instead, they can perform various functions that streamline your payment processing.

Examples of what it can do include:

  • Collect payment details from your customers (Examples include payment methods such as credit cards, Google Pay, Apple Pay and others);
  • Send payment requests to a payment processor;
  • Issue refunds of payments;
  • Void payments;
  • Enable recurring payments and repeat billing (such as subscription services);
  • Integrate local and global payment options;
  • Track orders;
  • Provide real-time payment data;
  • Issue payouts;
  • Accept and reach customers in international markets.

With so many functionalities, it becomes clear that an API is a necessary feature of your checkout. But how does the process work? We take a closer look below. 

Understanding the process

When your customers are ready to purchase from your website store, they will click a call to action button such as “Buy now”. Your API will pick up information about the browser your customer is using, as well as their location and transaction amount.

They will then be taken to a page where they enter their payment details, such as card details, and select their preferred payment method. All this takes place on your website. However, the API kicks in, and the process is then taken off your website to a payment gateway, which receives the payment details and transmits them to a payment processor.

The data is then sent to an issuer, who receives a payment request for authorisation. Once a decision is made about whether funds are available from your customer’s chosen payment method, the API will receive and deliver a message (success or failure) to the checkout page.

The transaction or payment session is then considered complete, and you, as the merchant, will have the funds arrive in your merchant account once the sale has been made.

Some criteria and additional factors to consider when you are implementing a checkout API include the following:

  • Authentication: Depending on your chosen checkout API provider, your API will need to be authenticated using an API key.
  • Card types: Not all checkout APIs are created equal. Some may come at a lower cost but may not accept payments via all card types.
  • Card verification: Card verification aims to verify a cardholder’s payment information for payments made online or over the phone.
  • Security and availability: Payment Card Industry Data Security Standard (PCI-DSS) is the leading global standard that a checkout API should comply with to ensure security when you process payments both for you and your customers.

Considering each of these factors when choosing your checkout API solution is an essential element in providing a seamless customer experience when purchasing from your online store.

When is it necessary to implement checkout API?

When is it necessary to implement it?

If you are an online merchant looking to accept payments from different payment sources, you need to implement a checkout API for your online shop.

This will streamline your payment acceptance process and add an extra layer of security for you and your customers when processing payments. As such, you’ll ensure your customers trust your brand and view you as a reputable merchant

What are the requirements for using a checkout API?

To enjoy the integration of your checkout API, different providers online will have different requirements for getting started with them. Most payment providers have the option to go through an online sign-up process, which can include specific steps and required details.

Let’s see what they are:

  • Login details, such as your email address, password, and phone number;
  • Personal details, such as your name, surname, date of birth, citizenship, and place of birth;
  • Business details include the business activity, address, registered company number and name.

    Other business details may include:
    • The legal form of your company, according to the applicable laws in your country;
    • Director details or a Power of Attorney as an authorised person.
  • Additional details, which may include:
    • The purpose for which you intend to use the payment provider;
    • Your primary source of income;
    • Foreseen annual turnover;
    • The average transaction amount expected;
    • Your websites and other online presence.
  • Referral code: if someone referred you;
  • Confirmation of legal authority and the truthfulness of the information provided;
  • Online identification step to verify your identity.

Once you become a merchant who is set up for online payments, you can get support from your payment services provider, who can help you with the process of setting up your checkout API.

The code will often be in the Java or PHP programming languages, and you will be set up with the latest API version. This means you will have access to new features, and the configuration and necessary tokens will be enabled.

As such, your website will be able to automatically create an order ID for your customer. This means that when they pay, your provider will be able to process the payment requests safely. In turn, you do not need to apply for PCI-DSS directly. The provider will then issue a status for the payment, which can be a false value if the transaction is not authorised, or a success value that authorises the payment. 

What is worth considering is that by default, your checkout API should be able to process different types of currency. It should also use a token to “shield” the customer’s data when being processed online. Furthermore, it should contain other essential features, such as clear documentation and a well-outlined description of the software development kit (SDK), so that you offer a seamless payment experience.

What are the benefits of using a checkout API?

There are many benefits of using a checkout API.

Let’s see what are the most important ones are:

  • A frictionless checkout experience: With the right payment partner and checkout API at your side, you can offer your customers a broad range of payment methods, which can improve the customer experience. Automated payment processes mean more free time and resources for merchants to focus on the business’ core parts.
  • Increased security: Through payment authentication, such as tokenised payments, as well as mandatory compliance checks, a payment gateway API can offer improved security, thus minimising the risk of fraud.
  • Simplify regulatory compliance: Choosing the right provider means you will comply with all the necessary payment regulations and standards.

All in all, the combined benefits of using a checkout API cannot be underestimated. They are essential for creating an outstanding customer experience while providing customers with security. In addition, it’s about ensuring that your business remains compliant so that you can operate seamlessly. 

Benefits of checkout API

Factors to consider when choosing a checkout API

Choosing a checkout API is not a decision that is taken lightly. Merchants must ensure their payment partner can cover all their needs. This is why it is essential not to choose the most cost effective solution but to approach the process holistically and consider features, pricing, ease of use, and integration as a whole.

Here are the factors that you should consider:

  • Features: Think about the API’s capabilities and consider its features, as well as whether they align with what you are offering your customers and what your current website’s functionality is. What type of payment methods do you want to provide, and what type does your API provider offer?
  • Pricing: Transparent pricing is key when choosing your API provider. As mentioned above, selecting the cheapest option will not always be right for you. Consider whether you’ll be paying a flat rate or a percentage. Also, consider whether you’ll be tied to a contract for a long period.
  • Ease of use and integration: Your chosen API should have a smooth and easy-to-use interface. It should offer your customers a superb user experience and be easy for you to navigate and access. You should also ensure that there is clear documentation for integration and implementation. Check if your provider offers sample code and tutorials, along with an SDK, to set up an API sandbox quickly. 

Other elements you will need to consider as part of the factors mentioned above include the level of customer support, compliance and security standards, and other functionalities you may need specific to your ecommerce business.


If you are about to enter the ecommerce space in the UK, then a checkout API is an absolute must. It will not only streamline the customer checkout process but also enable you, with the right functionalities, to enjoy seamless payment acceptance with reporting abilities.

However, choosing the right checkout API provider is an important choice you have to make. It requires in-depth research into factors that include pricing, functionality and, ease of use and integrations. Apart from this, you should also consider the essential element of regulatory compliance.

You have to be fully compliant with industry regulations and give your customers a safe shopping experience that protects them and you in the event of a fraudulent attack on your online business. Consider your options carefully and select your provider based on their reputation for quality in the industry, compliance, and support as well.

Frequently Asked Questions

A third party typically hosts this and enables a page akin to a pop-up where customers enter their payment details. With the third party taking care of your online payment acceptance for you, you have less concerns about being PCI-compliant, as the payment service provider (PSP) should have this compliance entrenched in their offering.

Your payment API provider should abide by and implement the latest security standards and should follow risk management protocols for PCI compliance. Features that you should look out for include payment authentication, tokenisation and built-in compliance checks. Each of these factors will minimise the risk of fraud.

Among the key features you should expect from your PSP and checkout API include:

  • Clear and timely communication related to updates and changes;
  • Testing offered in a sandbox environment to mimic the real product;
  • Clear documentation and reference materials related to your API.

The technical elements of a strong API include security through the use of tokenisation and fraud detection methods to meet financial industry regulations, good uptime, and fast processing speeds.

Other critical features are:

  • Scalability that enables handling of large transaction volumes;
  • Flexibility in terms of different payment channels, such as credit cards, digital wallets, etc.;
  • Reporting features that offer insights into custom data requests, historic data visibility and bank response codes;
  • The ability to support multiple currencies and regional requirements;
  • The ability to integrate with your existing tech stack;
  • The ability to handle disputes through notifications, management and resolution of payment dispute claims.

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