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How To Accept Credit Cards
Step by Step Process of How To Accept Credit Cards From Your Customers
Most businesses require an easy and affordable way to accept credit cards from their customers. Below is a step by step process of how to accept credit cards, and whether you accept payment in your store, over the phone, or online, these same steps and requirements are followed.
How Payment Processing Works
When a customer makes a credit card payment, the card information is recorded ?either by a credit card terminal, virtual terminal, or voice authorization ?and then verified so that the merchant can receive payment for the transaction. This process involves the following parties:
C Cardholder: The owner of the card used to make a purchase.
M Merchant: The business accepting credit card payments for products or services sold to the cardholder.
C Card association: A network such as Visa or MasterCard that acts as a gateway between the acquirer and issuer for authorizing and funding transactions.
I I Issuer: The financial institution or other organization that issued the credit card to the cardholder.
The flow of information and money between these parties ?always through the card associations ?is known as he interchange.?Facilitating this process and receiving your funds consists of a few steps:
A Authorization: The cardholder pays for the purchase and the merchant submits the transaction to the acquirer. The acquirer verifies with the issuer ?almost instantly ?that the card number and transaction amount are both valid, and then processes the transaction for the cardholder.
B Batching: After the transaction is authorized it is then stored in a batch, which the merchant sends to the acquirer later to receive payment.
C Clearing and settlement: The acquirer sends the transactions in the batch through the card association, which debits the issuers for payment and credits the acquirer. In effect, the issuers pay the acquirer for the transactions.
F Funding: Once the acquirer has been paid, the merchant receives payment. The amount the merchant receives is equal to the transaction amount minus the fee merchant pays the acquirer for processing the transaction.
When you know how to accept credit cards, the entire process from authorization to funding, usually takes about 48 hours. The right payment processing solution for your business depends on the nature and volume of your transactions. Merchant Solutions, LLC will customize a program that best fits your business model. Whether your business is retail, mail order,scarpe hogan, or online ?wel help you find the most effective solution.
We also offer a program that guarantees next day funding of your batches. If you batch out Monday night, your funds will be available for you on Tuesday.
What is nterchange?and how does it work?
Interchange is the banking transaction that takes place when a customer uses a credit card to make a purchase at your business. The credit card processor and your customer credit card-issuing bank exchange information so that the transfer of funds from your customer bank to your bank can be completed. This exchange of information is managed and maintained by the Visa and MasterCard associations.
The interchange fee represents a portion of the overall expense that the credit card processor pays for processing your Visa and MasterCard sales. This fee is in turn passed on to you as part of your discount rate. So when you make a Visa or MasterCard sale,billige MBT Schuhe, we pay an interchange fee on your behalf to the customer bank to compensate them for the underwriting, funding, and billing of your customer. Keep in mind Visa and MasterCard establish the rates and standards for interchange.
Interchange categories and their related fees are determined by the nature of your business and the processing procedures you follow. Visa and MasterCard determine these rates by assessing the level of risk and expenses associated with processing and funding a transaction. For instance,billige MBT Schuhe, the interchange fee for a face-to-face transaction is generally less than mail-order transactions because the risk of fraud is lower. Processing procedures with a higher risk of fraud require higher interchange fees.
That seems simple enough. Why does everyone say it so complex?
Part of learning how to accept credit cards is understanding that there are over 100 different interchange ates?or ategories? The particular rate that is charged on any given transaction depends on a number of variables, including:
T The type of card used in the transaction (debit, credit, rewards, business, etc.)
Where the card is used (restaurant, retail, gas station, etc.)
T The method of acceptance (swiped,Christian Louboutin Pas Cher, keyed-in, voice auth.,christian louboutin soldes, etc.)
What information is captured during the transaction (zip code, billing address, etc.)
When the transaction is submitted to the processor for settlement.
Visa and MasterCard access and evaluate their Interchange rates every April and October. They make the necessary changes to existing card types and add new card types if required. Merchants are notified prior to any changes being made, so that they may also make any changes necessary to their card acceptance.
Card Classifications
Qualified - The lowest retail processing rate category. In order for a transaction to qualify for this category, the credit card must be swiped though the terminal, the contents of the magnetic stripe transmitted, and an authorization must be received. The transaction must also be settled or batched out of the terminal within 24 hours of the authorization.
Mid-Qualified - The lowest rate category for which key-entered transactions can qualify. This category requires that the billing address of the cardholder be verified with a match of their zip code. Once again, an authorization number must be received, and the transaction must be settled or batched out of the terminal within 24 hours of the authorization.
Non-Qualified - The highest rate category in the processing environment. Generally speaking, this rate applies to key-entered transactions where the address is not verified with a zip code match, or transactions that are not settled or batched out of the terminal within 24 hours of their authorization. Most business cards also fall into the category of pricing.
Special Exemptions
Check Cards ?Bank cards with a Visa or MasterCard logo. These cards, if swiped, fall under the qualified classification. Check cards do not require a pin number. If a pin number is entered, the card will be classified as a Debit Card.
Debit Cards ?Debit cards require a pin number be entered at the point of sale. When a debit card is pinned into the system, they are not run through the Visa or MasterCard network. Instead, they are run at the debit networks interchange rates. Some of these networks include NYCE, STAR, and PULSE.
Rewards Cards ?The best category for which rewards cards can qualify is the mid-qualified category, even if they are swiped through the terminal. With approximately 20% of the cards in circulation being rewards cards, the typical merchant will have some mid-qualified transactions.
Business Cards ?While some business cards qualify at the mid-qualified rate category,Christian Louboutin Pas Cher, the majority fall under the non-qualified category.
Foreign Cards ?Foreign cards always fall into the non-qualified rate category, regardless how the transaction is processed.
Voice Approved Cards ?Anytime a transaction is authorized by a call center, and later hand-keyed into the terminal, it will go to the non-qualified category. Related articles：
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