Credit Card Processing Table of Contents
Credit Card Processing is an internet process wherein an authorized entity, generally a financial institution like a bank, issue a credit card to the end user. Issuing Bank/ Credit Card Processing: This is actually the financial institution that issued the credit card directly involved in the transaction to the end user. It submits the credit card authorization request to the credit card network, which either approve or deny the deal.
Credit card processing for ecommerce is another method of accepting credit cards for payment purposes. In this method the processing company charges a fee for every transaction made. Credit Card Processing for ecommerce is the latest method introduced by many credit card companies for enabling customers to purchase services online. Credit Card Processing for ecommerce is one among the most lucrative options as the companies charge a flat fee for every transaction made. Also this method charges less fees for transactions made within a specified time frame. The card details like the billing address, its amount, date and time of purchase are stored in a database of the credit card processing company which processes the transaction on behalf of the customer.
These are the automated software which accept and perform credit card payments online. The main advantage of using the fattmerchant services is that they perform the task without involving the user in any way. The fattmerchant services include the generation of reports, identification of the merchants, shipment of products to the customers and other related tasks. Some of the top companies like First Credit Card and Payment Gateway offer extensive and customized fattmerchant solutions to their clients.
To understand how credit card processing works we need to understand the role of both the sides. Merchant is the one who sells the goods on behalf of the buyer and the processor is the person who processes the payment for the buyer. There are different networks which help the merchants advertise their business online. A number of companies provide these services but it is best if you choose a company that can use your existing infrastructure and provides you with a solution which is flexible and can be modified according to the changing business requirements.
Internet has become the biggest medium of trading and it is due to the reasons that the businesses are expanding faster and growing at a faster pace. Nowadays internet has become a general mode of communication and the merchants have started to accept Credit Card payments online. Accepting Credit Cards means accepting payments for the goods or services which are bought through credit cards. The merchants not only need to have an accepting website but they also need to have a shopping cart so that the customers can easily select the things they want to buy and the payment will be transferred to their respective bank account.
Credit Card Processing Services Provides the Customer a Fresh and Faster Payment Option: Credit Card processing service helps in converting Credit Card transactions into the fund transfer form. As soon as the customer confirms the sale by clicking on the 'buy now' button he can get instant confirmation about his payment. Once the funds are deposited in the customers account the process of Credit Card Processing starts and the customer gets a fresh credit card in his mailailed address. This way Credit Card Processing provides a new dimension to the online business.
What are the steps of credit card processing? There are many parties that jump into action once your consumer swipes their card for payment. Merchant: The merchant who is in dire need of credit card processing and who swipes the card of his client. Cardholder: The person who owns the credit card that is being used for purchase.
There are many merchants who have jumped into the action of accepting credit cards for their sales. These merchants have the option of using a third party company to help them accept credit cards as part of their sales. This can be a great way for them to increase their revenues and reduce their operating costs. However, there may seem to be some problems associated with accepting payments via this method. There are some possible problems that may seem non-existent but may make accepting credit cards for your business a costly option.
Credit card processors do not have to deal with these potential costs. In the case of accepting payments through an outside processor the processing fees may be the same or slightly higher than what they would be if you processed through your own business. Some of these fees may include the third party fee which may make it a bit more expensive but these fees are not something that are ever going to be passed on to the consumer. When you process through your own business, you are the one who will be responsible for these costs.
Credit Card Processing for small businesses can be a huge nightmare. What happens when the economy goes into a recession? You lose your customers. You lose your employees. You may not even get any customers anymore.
It gets cut. You can lose your employees and your profit will drop because you won't be able to afford to hire them. The only way that you're going to get the money that you need to keep your business afloat is to start asking questions and working to prevent fraud. But what if you are faced with online credit card fraud and no one is answering the phone calls or emails that you're getting?
The Credit Card Processing for small businesses comes to a screeching halt. Because of the fees that they are asking for doing business online, there simply is no way for them to do business. When an online business owner decides to process their credit card transactions online, they usually have to pay a fee every single time. If you have a large customer base or a lot of sales, then this fee can be very expensive. But if you have a small customer base or a small amount of sales, then you don't have to worry about the fee. So what you do in that case is you will ask the merchant for an authorization to process the transaction without using the fee but without having to send them the authorization fee.
Scroll down to read our indepth Payment Gateways guide. What you should know, Payment Gateways features, price plans and support. Pros and Cons of Payment Gateways as a payment gateway, everything is explained below.
Spreedly is a software company that specialises in payment-gateway software for small to enterprise level businesses.
Spreedly is listed as the best payment-gateway software related to Payment Gateways. Spreedly was founded in 2008 in Durham, NC and currently has over 79 employees registered on Linkedin.