It is essential to choose the correct payment processor if you operate a business that accepts credit and debit cards online. Online payment processors take care of all the heavy lifting, from recording sales to sending you a statement of your bill and collaborating with banks to ensure that you are paid.
When a buyer purchases something on your website or in person at a brick-and-mortar store, their credit or debit card data passes through a payment gateway or PoS terminal. The gateway encrypts the information to protect it and then sends it on to the payment processor which transmits it to the customer’s card network. The card network then examines the bank account of the customer to see if they have enough money to purchase the item. If the bank accepts the purchase and the card issuer accepts it, they will transfer funds from their account to the bank that is owned by the merchant. The payment processor will then transmit this information to the merchant’s website or PoS terminal that will notify the customer that their payment was successful.
When choosing a processor think about factors such as security, ease-of-use, and compatibility with existing systems. Find a processor that includes APIs or plugins which can seamlessly integrate with your ecommerce system or POS. You should also consider the checkout experience of your customers, as well as the reporting and management options for your team. Finally, make sure you know the terms of your contract and how easy it is to switch providers in the future.
