Many companies nowadays make sales either exclusively online or on stores, or in both. Whatever the situation of your particular business is, credit card processing it is something useful for any business owner to consider.
Having credit card processing is a decision that may be easy for you to make. What makes it more complicated is selecting a merchant provider of accounting because this decision may have greater repercussions in your bottom line.
Although having credit card processing may be fairly easy, merchant accounts provide different services. Some of them may have different fees, rates and limits, and especially customer service. It is up to you to make up a mix of services and rates that benefits you and your customer the most.
Here we will try to explain step by steps all the implications to credit card processing in order to understand how it works.
The first step is when a customer makes a purchase using his or her credit card, either from our store of your website.
The software captures the information regarding the customer and the sale and it will later transmit it to the acquisition bank.
An authorization is later requested by the acquisition bank from the one emitting the card. Once it is accepted, the first one will process the transaction and will request yet another approval.
The credit card processing software will allow you to review the transaction and send a confirmation to the acquiring bank.
The funds are then transferred from the emitting bank to the merchant account.
The acquiring bank then requests and receives funds from the bank card issuer. Later the acquiring bank deposits the funds into the account of the merchant.
And that is all there is to credit card processing. It is important to note that all of these transactions are done quickly but there are some costs to them. The following are the most commonly charged fees:
First, there is a fee that is charged once at the beginning to get the system started. There is also a transaction fee that you will have to pay for every transaction made. Additionally there can be a Discount rate which is a percentage that you will also have to pay on every sale you make. Some credit card processing companies will also charge a Rate of return which is a percentage of your monthly sales and it is kept in reserve in case of fraudulent transactions.
Having credit card processing is a decision that may be easy for you to make. What makes it more complicated is selecting a merchant provider of accounting because this decision may have greater repercussions in your bottom line.
Although having credit card processing may be fairly easy, merchant accounts provide different services. Some of them may have different fees, rates and limits, and especially customer service. It is up to you to make up a mix of services and rates that benefits you and your customer the most.
Here we will try to explain step by steps all the implications to credit card processing in order to understand how it works.
The first step is when a customer makes a purchase using his or her credit card, either from our store of your website.
The software captures the information regarding the customer and the sale and it will later transmit it to the acquisition bank.
An authorization is later requested by the acquisition bank from the one emitting the card. Once it is accepted, the first one will process the transaction and will request yet another approval.
The credit card processing software will allow you to review the transaction and send a confirmation to the acquiring bank.
The funds are then transferred from the emitting bank to the merchant account.
The acquiring bank then requests and receives funds from the bank card issuer. Later the acquiring bank deposits the funds into the account of the merchant.
And that is all there is to credit card processing. It is important to note that all of these transactions are done quickly but there are some costs to them. The following are the most commonly charged fees:
First, there is a fee that is charged once at the beginning to get the system started. There is also a transaction fee that you will have to pay for every transaction made. Additionally there can be a Discount rate which is a percentage that you will also have to pay on every sale you make. Some credit card processing companies will also charge a Rate of return which is a percentage of your monthly sales and it is kept in reserve in case of fraudulent transactions.
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