About Real-Time Credit Card Processing

When credit cards are processed in real-time on the Internet, credit card information provided by the customer during the check-out process is typically passed to a service called "payment gateway". Payment gateways connect the online store with a credit card processor, on one side, and with your bank on the other side.

Your store order form - Payment gateway - Your bank

Credit card processor

There are a number of payment gateways that offer a different array of services. One of the most important things to look for in a payment gateway is whether or not the payment gateway allows you access to a secured area where you can manually refund previously processed credit card transactions. This will help you in handling returns on your store.

To process credit cards in real time you will need:

o A business bank account

o A credit card merchant account. Your bank or the gateway that you sign up with will help you get a merchant account. Note that credit card companies often handle online and offline credit card processing accounts separately. So even if you already have a merchant account that, for instance, is being used to process credit cards at your retail location, you may have to apply for an additional merchant account.

o An account with a payment gateway. Some credit card processors also act as a payment gateway, in which case you would not be required to take this further step. CardService International, a large credit card processor, is one of them (their gateway is called LinkPoint).

To use a payment gateway, you need to separately set up an account with one. Make sure that you create an account with a payment gateway that your bank can work with. Start by contacting your bank to find out what payment gateways they support.

Note: Typically payment gateways provide merchants with an administration tool to view past transactions, process refunds, add new charges to a credit card account, etc. Enquire with your payment gateway about such a service.

Note: When a payment gateway is involved in a credit card transaction, your store does not keep credit card information for that transaction in your store’s database. The payment gateway does. This ensures added security as payment gateways have highly secure servers.

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