Accepting Credit Card Payments: How to Process on an Ecommerce Site

A few things are needed when a business wants to start accepting plastic through an e-commerce website. Today, customers prefer a credit card option over any other type of transaction choice. These payments take less time, less paperwork and can be completed faster. Integrating online transactions can seem a bit overwhelming for a business just starting to consider this website addition; however, any organization can accomplish this change with some basic information. The process begins with obtaining a merchant account designed to accept credit card payments through the web. This element necessary for processing transactions is generally referred to as an Internet Merchant Account. A business can apply for this bank account through a regular financial institution or a third-party processing company. The company or bank providing this service performs confirmation of funds, authorization of transactions and transfer of money between accounts. These steps cannot be completed without this essential component in place. Fees are usually charged by both the issuing bank and the party providing these services. Fees vary wildly, so it’s important to know the details of the expenses before signing a merchant agreement.

Accept payments online: What does a business need to succeed?

In a regular retail environment, the merchant account and swipe or entry equipment is all a business needs to start running this form of transaction. Accepting payments online involves a few more things and more detailed setup. A payment service provider may be required to provide the terminal used to process each web transaction. This service may need to be purchased separately depending on what a particular provider offers. A shopping cart transfers all transaction details to a payment form which is integrated with a terminal used to collect all customer card details. The information is verified before being sent securely to the financial institution for processing. This component is often referred to as a payment gateway and may be included in Internet merchant services. A company must first decide whether the transaction form will be hosted on its web server or managed by a third-party provider.

The typical processing setup requires the ability to implement technical solutions as well as merchant service factors. If a business doesn’t want to deal with the technical part of accepting payments online, everything can be acquired from payment processors. They offer a simpler application process, faster setup, and offer an all-in-one solution to meet transaction processing needs. Some of these providers accept payment on their own website. This type of service can be handy for a company that has just set up its site or is unfamiliar with the process. When using hosted processing, a business should expect longer settlement time and higher costs. Settlement with this type of setup can take up to sixty days while the traditional method takes an average of one to two business days. Other companies may be able to complete the process much faster. By researching each vendor before applying, a business will have a much easier time finding the exact service they want to accept credit card payments.

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