ProPay Blog

Mar

A Behind-the-Scenes Look at Payment Processing

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• Tags: Credit Card Payment Security, Encryption, Fraud, Fraud Prevention, Fraud Protection, Risk,, Fraud Protection, Mobile Credit Card Payments, Mobile Payment Solutions, Mobile Payments, Payment Processing, Payment Security, Small Business, Tokenization

Payment processing is now possible almost anywhere. It has moved beyond traditional retail to the internet, into the field and beyond; thanks to technology like online, wireless and mobile payment processing.

But for many merchants, what goes on behind the scenes after a credit or debit card is accepted is a little hazy. That’s why we’ve pulled back the curtain to give you a behind-the-scenes look at payment processing.

The cardholder is just the first cog in the credit card processing machine. Once the customer swipes or dips a card at a merchant's terminal, or enters account information on a website—the data is transmitted electronically to the merchant's processor. The processor passes the information along to the credit card association, which confirms with the card issuer that the cardholder has adequate credit to cover the transaction. Authorization is passed along to the processor, who informs the merchant, who then completes the sale by issuing a receipt. This chain of events is completed in seconds — faster than it takes to write a check or count out change.

How long does it take for funds to reach an account? After the merchant submits all the transactions at the end of the day to the processor in a batch settlement, the processor sends them to the issuing bank for payment. The issuer pays the processor and bills the cardholder. The processor deposits the funds into the merchant's account, usually within 48 hours of the sale.

Security is the foundation of all electronic payments processing. Both merchants and processors use SSL (secure socket layers) to shield sensitive and personal information from fraudsters and hackers. Additionally, the Payment Card Industry Security Standards Council (PCI SSC) has established and enforces the PCI Data Security Standards (PCI DSS), which lays out requirements for maintaining a secure transaction environment that all merchants and credit card processors should follow. Merchants that are not PCI compliant risk being held liable for costly chargebacks and potential fines.

What if I want more than just payment processing? Most merchant services providers offer products and services beyond debit and credit card processing. In addition to merchant accounts and various processing options, providers can provide merchants with credit card machines and software, electronic payment gateways, data management, monitoring and reporting services. Ensure your payment processor offers these options.

Accepting credit cards is a process that simplifies transactions for merchants and customers alike. Credit card processing is quick, secure and convenient and today’s consumers have come to expect to pay with plastic. Savvy merchants will oblige and ensure that whatever way their customers want to spend, they can accommodate quickly, efficiently and effectively.

Now that you’ve looked behind the curtain, it’s easy to see how payment processing can help your business on the road to success.

For more information, contact ProPay at 844.896.3209, email marketing@propay.com or visit www.propay.com.

A Behind-the-Scenes Look at Payment Processing

A Behind-the-Scenes Look at Payment Processing

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