Credit Card Acceptance On The Internet
The first piece of credit card acceptance on the Internet is a merchant credit card
account. A bank or other financial institution is required to set up the account for you
(credit verification is required). Ideally, the bank you currently do business with can
issue a merchant credit card account. When you are set up with your bank or other
financial institution, you may find that they contract out processing credit card
transactions to a transaction clearinghouse.
If your bank does not offer merchant credit card accounts for online use, you will need to
use a merchant credit card broker.
The next piece is a hardware or software gateway that connects you to the transaction
clearinghouse. There are three common gateways:
Card Swipe Machines: Nearly every store in the country lays one of
these gray flat boxes that a store clerk swipes your credit card through and enters the
amount of the transaction. A few seconds later the terminal lights up with an
authorization code which is printed on you credit card transaction receipt. This
authorization number come from the credit card clearinghouse that the store's bank
contracts with, and effectively assures payment to the merchant when the customer signs on
the dotted line. If you are using a card swipe machine, you can accept credit card orders
over the Internet. When your order form is submitted, the information is e-mailed to you
and you can manually process the credit card.
Desktop Software: Many businesses do not see the customer's credit
card. They get the credit card number over the phone, via mail, or over the Internet. The
merchant enters the credit card information and transaction amounts in special software,
and transmit that list over a modem to the clearinghouse designated by the bank. The
clearinghouse then responds with a list of "good" cards and "bad"
cards. The merchant then sends a list back to accept the transactions for good cards.
Real-time Website Gateways: There are several sources of gateways to
the processing clearinghouse which can check the customer' credit card while they are
still on line. In some cases the gateway requires a special set-up by your Internet
Service Provider(ISP). Others employ Internet connections to a service bureau gateway.
These various gateways provide a bridge from your website to a completely different modem
channel to check the credit card instantly. If you choose a real-time gateway, be sure it
is compatible with your website. Standard HTML forms can accommodate a real-time gateway,
while many "shopping cart" programs can not.
Secure transactions are made possible over the Internet with SSL
(Secure Sockets Layer). This protocol allows private documents to be transmitted over
the Internet by encrypting the data.
Vermont Banks who offer merchant credit card account
for online use.
Costs involved in accepting credit cards.
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