How Do Credit Card Payments Work?

Credit card payments can be confusing at first. So I’m here to explain it as simply as possible!
When a customer begins the transaction, their credit card information is sent through a payment gateway. The payment gateway acts as the mediator between you, the merchant, and the Network. It is necessary for ANY business to use a gateway when handling credit card payments.
The Payment gateway then safely sends the credit card information to the Network where it can verify the transaction. It is vital for the payment gateway to meet PCI security standards to keep the customer’s sensitive information safe.
Next, the Network requests authorization from the customer’s bank that they have the funds for the transaction. If the bank denies the authorization, the customer’s credit card will get declined. If the bank approves, meaning the customer has the credit or funds for the transaction, the network receives the responds and sends it back through the payment gateway, to you and the merchant.
Once that authorization is complete, the credit card transaction is a success!
As these transactions occur every day, they are put together to form a batch. At the end of a business day, the Network collects the funds from the batch and deposits it into your merchant account. That merchant account is unique for accepting credit card transactions.
And there you have it! So when you begin accepting credit card payments in your business it’s important to find a merchant gateway that can handle those transactions properly, ensuring that you meet PCI security standards while providing the lowest rates possible so you save on your processing fees. To learn how, visit EBizCharge.com
Transparent flat rate pricing. No contracts. No switching costs.
Call now for a complimentary cost savings analysis.
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