vietfirm.com
31-03-2004, 09:43
To accept online payments, you will need the following:
1. An electronic shopping cart system.
2. A payment gateway service.
3. A credit card processor.
4. An Internet merchant account issued by a bank or other financial institution or service bureau.
Here's how online credit card processing works:
Your customer submits his credit card information at checkout on your Web site.
The shopping cart software sends the transaction to the gateway.
The gateway routes the information to the processor.
The processor contacts the bank that issued the customer's credit card.
The issuing bank approves or declines the transaction.
The processor routes the result back to the gateway, which then passes the result back to the Web site shopping cart system.
The entire process is done electronically and takes just seconds to complete. Now here's a closer look at some of the terms you'll need to understand:
Payment gateway service: The payment gateway service comes into play when a customer submits his or her credit card information to the Web page form. Think of the gateway service as the middleman in the process. The Web site's shopping cart checkout system electronically submits the credit card to the gateway service, which then routes the information to the processor for approval.
Credit card processor: The credit card processor is an electronic data center that processes the credit card transactions coming from the gateway company, ensures the charge is valid and then settles the funds in your merchant account.
Internet merchant account: An Internet merchant account is a bank or account in which funds from online sales are deposited by the processor. Merchant accounts are usually issued by banks that are associated with the major credit card services like Visa and MasterCard. Be aware that many banks will not grant merchant accounts to Internet merchants, as they are often categorized as high-risk ventures. This policy varies widely and, in the end, the granting of the merchant account will come down to economics from the bank's point of view. If the bank sees even the smallest iota of risk, you will not be granted the account.
Fortunately, the growth of online sales has given rise to an entire industry of merchant service bureaus that will grant you a merchant account and everything else you need to accept online payments. The fees are usually higher, but it's better than not having an online payment system at all.
Shopping cart system: To accept online payments, you must have a shopping cart system that allows the customer to select and purchase products from your Web site. A shopping cart system typically consists of three components: the product catalog, the shopping cart and the checkout/payment system. The product catalog displays the items you have for sale on the Web site. The shopping cart system allows your customers to select products by clicking an "add items to cart" button, and the checkout/payment system allows the customer to complete the checkout process and pay for his or her purchase with a credit card. It is the checkout/payment component that communicates with the gateway system to complete the transaction.
Adding a shopping cart system to your Web site can be a simple or highly complex task, depending on the system you select. The cost of shopping cart software ranges from free (for simplistic form-based systems) to very expensive. To select the shopping cart system that's best for your business, you should consider a number of factors, including the product you're selling, the depth of your product line, the purchase options you wish to offer customers, the inventory control functionality and the extent of automation you desire.
Numerous companies can assist in the setup of your shopping cart and online credit card payment system. These companies typically charge several hundred to several thousand dollars for their services—but, like anything, you get what you pay for, so always use a company with good references in this area. The money you spend now will be returned many times in increased sales volume from credit card customers.
1. An electronic shopping cart system.
2. A payment gateway service.
3. A credit card processor.
4. An Internet merchant account issued by a bank or other financial institution or service bureau.
Here's how online credit card processing works:
Your customer submits his credit card information at checkout on your Web site.
The shopping cart software sends the transaction to the gateway.
The gateway routes the information to the processor.
The processor contacts the bank that issued the customer's credit card.
The issuing bank approves or declines the transaction.
The processor routes the result back to the gateway, which then passes the result back to the Web site shopping cart system.
The entire process is done electronically and takes just seconds to complete. Now here's a closer look at some of the terms you'll need to understand:
Payment gateway service: The payment gateway service comes into play when a customer submits his or her credit card information to the Web page form. Think of the gateway service as the middleman in the process. The Web site's shopping cart checkout system electronically submits the credit card to the gateway service, which then routes the information to the processor for approval.
Credit card processor: The credit card processor is an electronic data center that processes the credit card transactions coming from the gateway company, ensures the charge is valid and then settles the funds in your merchant account.
Internet merchant account: An Internet merchant account is a bank or account in which funds from online sales are deposited by the processor. Merchant accounts are usually issued by banks that are associated with the major credit card services like Visa and MasterCard. Be aware that many banks will not grant merchant accounts to Internet merchants, as they are often categorized as high-risk ventures. This policy varies widely and, in the end, the granting of the merchant account will come down to economics from the bank's point of view. If the bank sees even the smallest iota of risk, you will not be granted the account.
Fortunately, the growth of online sales has given rise to an entire industry of merchant service bureaus that will grant you a merchant account and everything else you need to accept online payments. The fees are usually higher, but it's better than not having an online payment system at all.
Shopping cart system: To accept online payments, you must have a shopping cart system that allows the customer to select and purchase products from your Web site. A shopping cart system typically consists of three components: the product catalog, the shopping cart and the checkout/payment system. The product catalog displays the items you have for sale on the Web site. The shopping cart system allows your customers to select products by clicking an "add items to cart" button, and the checkout/payment system allows the customer to complete the checkout process and pay for his or her purchase with a credit card. It is the checkout/payment component that communicates with the gateway system to complete the transaction.
Adding a shopping cart system to your Web site can be a simple or highly complex task, depending on the system you select. The cost of shopping cart software ranges from free (for simplistic form-based systems) to very expensive. To select the shopping cart system that's best for your business, you should consider a number of factors, including the product you're selling, the depth of your product line, the purchase options you wish to offer customers, the inventory control functionality and the extent of automation you desire.
Numerous companies can assist in the setup of your shopping cart and online credit card payment system. These companies typically charge several hundred to several thousand dollars for their services—but, like anything, you get what you pay for, so always use a company with good references in this area. The money you spend now will be returned many times in increased sales volume from credit card customers.