| If you though the super-sonic transport jet that used to | | | | The whole process - with all the authorizations, |
| get people to Paris in the time it takes for a power | | | | verifications, involved parties and security measures, |
| lunch, then you'll appreciate the speed at which | | | | etc., takes less than 15 seconds. |
| merchant services are handled these days. | | | | At the end of the day the merchant settles their batch |
| Though credit card use continues to increase around | | | | - which the store owner's version of happy hour - the |
| the world, few cardholders have a clue about what | | | | time when the acquiring processor finalizes |
| happens when their card is used at their favorite | | | | transactions with the issuing bank(s), and funds are |
| department store, or when they shop online. | | | | transferred to the merchant's bank account. |
| The short answer is that quite a bit of activity is going | | | | When the transaction is over the Internet, there are |
| on in a very short amount of time. | | | | minor differences. |
| Indeed, the speed at which the process happens | | | | After the consumer picks out what they want and |
| makes it hard to comprehend how many steps are in | | | | collect it into a virtual shopping cart they click over to |
| place and covered to make sure all parties are | | | | the checkout page, where they enter their shipping and |
| protected while business is getting done. | | | | billing information. Their card information (number and |
| When you offer up your card as payment in a store, it | | | | expiration date) are entered on to a secure form |
| is swiped through a terminal that reads the magnetic | | | | transmitted over the Web using real-time processing |
| strip on the back side of the card. The terminal will | | | | software, which then encrypts the transaction to the |
| then connect the acquiring processor to get | | | | acquiring processor for authorization. |
| authentication - is it showing up as legitimate? | | | | The acquiring processor will then pass the transaction |
| Assuming all is good to this juncture the processor | | | | to the card association, which requests final |
| then kicks the transaction to the card association, | | | | acceptance from the issuing bank. The bank accepts |
| which forwards the information for the authorization | | | | or declines the transaction and notifies the card |
| from the bank that issued the card. | | | | association. The association contacts the card |
| It is here that bank accepts or declines the transaction, | | | | processor with the authorization and the request to |
| whipping a response back to the card association. | | | | deliver goods/services is sent to the merchant. |
| Assuming there is acceptance, the association | | | | As before, the merchant sends the card processing |
| contacts the credit card processor with the | | | | company the fulfillment-to-permit- settlement notice |
| authorization and a request to deliver goods and/or | | | | -the goods are ready for shipping. The capture takes |
| services is sent to the merchant via a POS terminal. | | | | place as authorization is given to the issuing bank and |
| This is the point at which the green light is lit so you | | | | the customer's card is charged. |
| can get your purchase. | | | | And as before the merchant settles their batches at |
| The merchant then sends the card processing | | | | the end of the day and the funds are deposited into |
| company what is called a fulfillment notification to | | | | the merchant's bank account. |
| permit settlement - which means the goods/services | | | | Again, what surprises most people is not the amount |
| are actually handed over. Then the credit card | | | | of steps that it takes to process a credit card as |
| authorization information is sent to the issuing bank and | | | | payment but the speed at which the transaction takes |
| the customer's card is charged. | | | | place. |