CreditCard Processing

Accept Credit Cards

Accept credit cards

By choosing to accept credit card transactions using merchant processing, merchants can lower administrative costs, increase their revenue, gain quicker access to funds, and become more efficient. Accepting credit cards helps your business appear more modern and innovative. Giving your customers the convenience of paying by credit card simultaneously reduces errors in cash collection and lowers the risk of default. Meanwhile, your business will be able to increase retention by offering customers with recurring charges the opportunity to pay automatically.

Accepting Payments

Easy credit card processing - Accept Visa, MasterCard, Discover, and American Express Payments deposited into your bank account automatically. To accept payments you'll need a payment device such as a credit card terminal, pin pad terninal, payment gateway or smart pgone application.

A payment processor is a company (often a third party) appointed by a merchant to handle credit card transactions for merchant acquiring banks. They are usually broken down into two types: front-end and back-end.

Front-end processors have connections to various card associations and supply authorization and settlement services to the merchant bank's merchants. Back-end processors accept settlements from front-end processors and, via The Federal Reserve Bank, move the money from the issuing bank to the merchant bank.

In an operation that will usually take a few seconds, the payment processor will both check the details received by forwarding them to the respective card issuing bank or card association for verification, and also carry out a series of anti-fraud measures against the transaction.

Additional parameters, including the card country of issue and its previous payment history, are also used to gauge the probability of the transaction being approved.

Once the payment processor has received confirmation that the credit card details have been verified, the information will be relayed back via the payment gateway to the merchant, who will then complete the payment transaction. If verification is denied by the card association, the payment processor will relay the information to the merchant, who will then decline the transaction.

Credit Card Processing

Historically credit card processing services were supplied by banks that were members of the Visa or Mastercard networks. Typically banks both issued credit cards and helped merchants process them, but over time the industry consolidated. Now, very few banks issue credit cards and the industry is dominated by a few large issuers - Elavon, Citibank, Capital One, MBNA / Bank of America, and Chase. Even fewer banks process credit cards. Banks found that it was not within their skillset to convince every small merchant to accept credit cards, and they began to outsource the selling of such services to small companies called ISOs (Independent Sales Organizations). They also found that massive scale helped reduce the cost of processing credit cards, so they began to outsource processing to a few giant credit card processors.

Now, while some merchants buy their credit card processing services directly from a bank, more typically they get their credit card processing services from an ISO, which is responsible for selling the service to the merchant, providing technical support, processing the transaction (authorizing it and submitting it to the Visa or Mastercard network) and sets the price of the services.

While each of the firms discussed above provides merchant accounts and could legitimately be called the merchant account provider, in practice the phrase usually refers to whichever organization has responsibility for directly maintaining the merchant account.