As a customer, you are already familiar with payment processing but might not know it. It is the process that takes place whenever you make an electronic purchase in person or online. The entire service takes seconds. However, multiple steps are involved that require payment processing services from a third party to install and manage. Here is more about payment processing services and how your business can find the right processor.
The Go-Between for Transactions
Payment processors are the necessary mediator between customers, banks, and merchants. They design, install, and manage transactions between customers and banks plus banks and merchants. Overall, they make the electronic process of transferring a sale from the customer’s bank account to the merchant’s seamless.
How Payment Processing Works
Payment processing begins when the customer swipes their credit or debit card or clicks an order button online. This first step is called the point of purchase. The payment system will already be instituted with the merchant’s business.
At the payment gateway, the payment processor gathers the customers’ card information and verifies it. In this step, the gateway will communicate a card acceptance or decline.
The payment processor itself will deliver a customer’s card and transaction information to the bank and from the bank to the merchant’s account. It is the vehicle by which information travels to and from the bank. The bank is the ultimate entity that decides whether or not to accept the payment.
This entire process of channeling information from the customer to the merchant with the bank’s permission happens in mere seconds, and it is thanks to the payment processing system that it works so smoothly.
How to Choose a Payment Processor
Businesses need payment processing services to have that electronic payment option either in their physical storefront or online. More than ever, people are making purchases electronically rather than by using cash or checks. If you are a business owner, you will want a payment processing company you can trust.
Several key features of your payment processing company should be as follows:
- Excellent customer service
- Flexible transaction options
- Fraud prevention and management
- Business growth opportunities
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