Transaction flowchart

This diagram illustrates the interaction between the parties involved in a payment transaction. Some nodes are collapsed and will be explained in the consequent pages.

High level Payment flow for Crypto processing / Bank onramp scenarios

Main steps

1. Flow Initiation: The process begins with an end user ready to make a payment for goods or services, such as topping up a balance or settling a bill.

2. Payment Instruction: The user provides payment instructions (e.g., pay $100), which are sent to the merchant for negotiation of details. Merchants may either use their own systems or leverage the XGateway functionality to simplify the checkout process and reduce the need for user input.

This diagram focuses on the XGateway checkout flow, representing a more complex case.

1. Checkout Redirection: When the merchant redirects the user to the XGateway checkout page, our service determines whether the user is new or returning:

   • New Users: Personal information is requested, and a payment medium is created to process the invoice in the selected currency. Both crypto payments and bank onramp services for fiat currencies are supported.

   • Returning Users: Stored details are applied, and the process advances directly to the KYC (Know Your Customer) step.

2. KYC Verification: KYC verification is optional for crypto payments and first-time onramp payments under 700 EUR to streamline the process. However, the limits may be changed, and merchants may enforce KYC for specific cases.

   • This step, while collapsed in this diagram for simplicity, is intricate and detailed in a dedicated chart.

3. Invoice Activation and Payment Monitoring: Upon completing the KYC step, the invoice is activated, and our internal service monitors the payment. Users must complete the payment within a configurable time window (default: 20 minutes). If the payment is not completed within this time, the invoice is canceled. Users can also cancel the invoice, with optional notifications sent to the merchant.

4. External Payment Execution: Users are provided credentials (e.g., virtual IBAN or crypto wallet address) to make the payment. However, some limitations exist:

   • Payment cannot proceed if the channel is not yet established.

   • Incoming crypto payments cannot be automatically rejected or source-limited unless processed via a bank onramp with such capabilities.

   • There is no guarantee that users will complete payments or do so within the allotted time, resulting in a percentage of failed transactions.

   To address these limitations, XGateway applies a configurable set of rules to validate transactions. Detailed insights into this validation process are provided in a separate payment flow diagram.

5. Transaction Validation: failed If a transaction fails validation, processing halts. Based on the payment medium, merchants can configure notifications for failed transactions (useful for bank transfers or high-value networks) or omit them (recommended for low-cost networks prone to malicious dust transfers).

6. Transaction Validation: confirmed Upon successful validation:

   • The user is notified.

   • A callback is provided to the merchant.

   • The original invoice amount and actual transferred amount are shared with the merchant to manage user balance adjustments appropriately. This ensures accuracy in handling issues such as:

     • User errors (e.g., transferring 10x or 0.1x the intended amount).

     • Significant changes in currency conversion rates.

     • Payments made in a different currency.

Merchants must review the completed invoice details to correctly adjust the user’s balance.