Do you know what happens when you process a credit card transaction from a customer? Your merchant processor will handle the behind-the-scenes details. But, it is helpful for business owners to know what is going on when the credit card is swiped.

How Credit Card Transactions are Verified

A credit card transaction can be processed in any number of ways:

  • Face-to-face environment
  • Over the phone
  • (on your website)

Once the card information is collected on the terminal, the details are sent to the payment processor. Then, the processor contacts the bank that issued the credit card. At this point, the card issuer gives a thumbs up for approval, or a thumbs down if the card is declined.

Next, the process is reversed: the information goes back to the credit card processor, who then sends the information back to the business owner. This process only takes a matter of seconds, and then you will receive a receipt print-out or a thank you pop-up on a digital terminal.

The Benefits of Accepting Credit Cards

If you aren’t already accepting credit cards, then you should consider adding this service to your business. Here are a few benefits that you need to consider:

  • Bigger Transactions: Most customers spend significantly more when purchasing with a credit card. Even though you will pay a fee for accepting the card, most of the time the purchase will be quite a bit bigger compared to a cash transaction.
  • Customers Feel Safe: Often, customers pay with a credit card for consumer protection. This assurance increases the likelihood that businesses will stand behind their products. If something goes wrong and the company isn’t willing to help, then the customer can work with the credit card company for a charge-back.

There is no doubt that credit card transactions should be part of your business offerings. If you need help implementing a new merchant processing system, then I am always here to help! Feel free to email or call anytime for more information.