Credit card processing is the procedure taken to make and complete payment using a credit card. This process could be done over the phone, on a one-on-one basis, through the mail, and on the internet.
Credit card processing is synonymous with “payment processing,” this is a more recognized term.
Major Entities Involved in Payment processing
- The Customer/ Cardholder.
This is the cardholder who has purchased a good or service.
- The Business Owner.
This is more like the middle man. The business owner, also known as a merchant, is the business or individual selling the good or service purchased by the consumer.
- The Payment Gateway.
This is the channel used for the transaction. It is the technology used to make payments via a credit card, debit card, or USSD code. The payment gateway grasps the cost of the goods and services purchased and sends them to a payment processor with a printed confirmation on whether the payment was successful or not.
- The Credit Card Processor.
This is the channel that connects the consumer’s credit card, the merchant, and the consumer’s bank. For every high-risk credit card processing transaction, the credit card processor guarantees the security of every transaction between a merchant and a consumer. Where some processors provide their payment gateways, others function using reseller agreements.
- Credit Card Brand.
This is the kind of brand a consumer uses, which could be a MasterCard, Visa card, etc. The credit card brand is saddled with assessing fees using the criteria of Payment Card Industry Data Security Standards (PCI DSS).
- Bank Issuing.
This is the customer’s bank, i.e., the credit card holder’s bank from which the financial transaction would be confirmed and paid. The bank issuing is the bank that confirms the customer’s eligibility to pay for a product or service. They process the financial details of a cardholder and respond in line with what’s on the ground.
- Acquiring Bank.
This is the bank that receives the payment from the transaction made and confirmed by the issuer bank. When the issuer bank has confirmed the cardholder’s eligibility, it makes a direct transfer of the total bill as typed in by the merchant through the credit card processor to the acquiring bank. Thus, the acquiring bank is always the bank of the merchant.
After these processes, the merchant gets a response from the acquiring bank via the card processor, mail, or a text message confirming the transaction. The consumer is also expected to have a copy of the transaction slip before leaving as a confirmation and proof of payment.
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How To Find A Reliable Credit Card Processing Provider?
The question over time has always been how to find a credit card processor provided that is reliable and efficient. Of course, every business should find a credit card processor provider, but how do you get a provider that would guarantee the security of your business and its finance?
There are a lot of credit card processing provider companies, but not all of them are reliable. Therefore, on finding a reliable credit card processor provider, you must put the following into consideration:
It is never advisable to jump into the arms of just any credit card provider you see. Do a detailed study and ask questions from people who have worked one on one with these providers. They are in the best position to tell you about their journey so far and how reliable the provider they are working with is. When finance is involved, proper caution must be taken before making a selection.
- Business Consultant Advice.
Before getting a credit card provider, it is advisable to seek advice from a business consultant. A professional in the field would give you more insight into how it works and the best plugs within your territory. In addition, your business consultant is always in the best position to explain in detail all you should know about credit card processing providers.
- Service Fee.
Find out the service fee of the credit card processing providers around. The service fee of some card processors is ridiculous, which has hidden charges that are not stated or explained properly. You are at risk of loss if the credit card processing fee is on the high side. This is a major point you must ensure to get proper information on. Other fees to research upon are; monthly statement fee, Set up and application fee, interchange fee, monthly minimum fee, monthly payment access fee, early termination fee.
- Setup Time frame.
It is crucial to consider how long the setting up of a credit card processor would take. You won’t want to work with a provider whose process for setup takes too long before completion, and this would only slow down your progress as a merchant, which Is bad for business.
- Available Payment Type.
You must also consider the payment type available for the credit card processing provider you want to work with, putting a note of the type of business you’re operating.
- Check Out For Customer Support.
This is vital. Some providers have very weak service support, which may prolong processes when there is an issue on the ground. In all your selections, this should not be neglected.
Working with a reputable company has been researched to improve sales generally and make the business have more returns naturally. If you are yet to work with a credit card processing company, now is the time to.