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subject: How Credit Card Processing Works [print this page]


What is a credit card?
What is a credit card?

It is a payment card used by the people to pay for the goods that they buy online or at a retail store. In order to a credit card, you must open an account with any bank or financial institution. This allows the users to borrow money for making a payment to a merchant or use it as a cash advance service.

How a credit card is processed?

Nowadays, youll find every other person using credit cards to make purchases. As per the recent survey, more than 23 billion credit card transactions are done annually. Although all know how to use the credit card, but only a few know what happens after it is swiped. Credit card processing is done in 4 easy steps and they are explained here for your easy understanding.

Authorization: In this first step, when you swipe your card, the details of your accounts encrypted on it get verified with the concerned bank. Once it is authorized, the payment will be successful processed.

Batching: It is a procedure where the merchant sends all the receipts in a batch to the bank to receive for the collection of payments.

Clearing: The banks then send these batches to the card department, in order to collect money from the customers accounts. This money is then paid to the merchant for a small charge, locally called interchange fee.

Funding: Finally the merchant would be funded after subtracting the transaction fee.

Credit Card Processing Services

All the credit card providers offer satisfying solutions to all their customers. You call contact them any time and get all your queries resolved. Nowadays, accepting credit card payments is made easy through the advanced card readers. With a good quality credit card processing equipment, you being a merchant can easily manage your inventory and customers list. At the same time it also gives detailed transaction report about the payments that have been made by the consumers.

You can log into your account to manage all the transactions, as the data is securely stored upon the server. If you are looking out for the best credit card service provider, then opt for a reputed financial institute that offers fast, safe and secure services.

Reliable credit card processing services will definitely help in increasing your business. Some of the optimum services offered by the credit card companies are:

Allows you to accept all forms of payment

Payment can be accepted from anywhere or at anytime

By providing VeriSign SSL certificate for security protection against the misuse of the card

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