When it comes to processing payment you do have to make sure that you get it right on the first attempt. Payment processing is such a basic part of the process, and customers will expect you to be able to get it right and do it properly which means that you will need to have a good grasp on the situation.
It would help if you had a handy-dandy guide to payment processing, wouldn’t it? That’s where we’ve decided that we have to try to put together all that you need to know about payment processing.
The Payment Processing System
There are three different parts to any payment processing system which you need to know about. These are the authorisation, the settlement and then the funding process.
How Does it All Work?
To make sure that you understand how payment processing works, we’ll talk about the one which you’re going to want to understand the most - authorisation.
So first of all, the cardholder, or the person paying will provide their card or other secure payment method to you at the payment terminal. The request for payment processing can come from online or in a brick-and-mortar establishment - there’s no real limit as such in this regard.
The merchant, which is you, will then have to send a request for payment authorisation to the payment processor unit. The processor will send transactions to the card association of the card holder, which will then get to the bank themselves.
Once it gets there, the request for authorisation will be submitted, and all of the relevant checks are done to make sure that this is a legitimate transaction. From there, you’ll find that there’s either approval or denial depending on the situation.
If the account of the cardholder is closed, or the transaction is more than the funding or credit available, then you’ll find that the transaction just won’t get accepted.
From there, the request will either be accepted or declined. If it is accepted, then that money is automatically paid to you and taken from the account of the cardholder and is held away from their access to make sure it is paid properly.
It’s not a particularly difficult process but it is one which can all happen within the space of a few moments. It means that you can take payments without having to wait for ages.
So, in conclusion, payment processing is one of those things which people have to understand if they’re going to make the right decisions when it comes to how they do things. Ultimately, you’re going to have to make sure that you give the correct details and that the system you’re using is legitimate to process the needs of customers.
However, as we’re living in an increasingly card-based society, if you don’t have payment processing options, you may struggle to make sure that everything proceeds properly and your business even has a fighting chance. Society is going cashless, you’ll need to as well.