How Credit Card Processing Works: Key Players

1. How Credit Card Processing Works: Key Players Credit cards have become an integral part of our lives. Be it an evening outing with a few friends or a grocery shopping trip, none of it feels complete without a credit card in your wallet. And honestly, why wouldn’t it? Regardless of the amount, the entire transaction is completed in a matter of seconds. But even though credit card processing looks simple, it is an intricate process that involves multiple participants. In this article, we are going to try and explain to you how online credit card processing works by telling you about the key players involved. Customer A customer is a person who intends to use a credit card to make a purchase. Merchant A merchant is a business that sells goods and services to a customer, who then uses credit cards to make the payment. Issuer Also known as the acquiring bank, the issue is the bank that issues a credit card to the customer. For example, Visa or Mastercard. Merchant provider A merchant account is mandatory since it is where the merchant’s funds are deposited after the transaction is complete. A merchant account provider is the one who helps you open a merchant account. Payment processor A Processor is a go-between that empowers transactions to course through the system to get approvals and stores by means of the Interchange Network. You don’t get to choose the payment processor. It is chosen for you when you choose the bank. Payment gateway A payment gateway helps with the authorization of transactions. When you swipe the card, your data is sent for approval. The customer then gets notified whether or not the transaction is approved. Now you know that a process that takes seconds to complete has so many participants behind the curtain. We hope this article will prove helpful to you to understand.