Payment Gateway Based
Online Credit Card Processing Solutions
For the merchant who wants to get online fast with a limited start-up
budget, internet-based credit card processing is one of the best choices.
A payment gateway facilitates e-commerce payments by authenticating
the parties involved, routing payment related data between these parties
and the concerned banks/financial institution in a highly secure environment
and providing general support to them.
Payment Gateway enables you to manage the authorization and settlement
of encrypted payment messages over the internet. It handles certification
management, routing, decryption and encryption, and key management for
SSL. Merchants use their gateway to send the information for their credit
card processors to process their transactions over a secure Internet connection.
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Acquiring Bank
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Credit Card
Network
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Issuing Bank
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Payment Gateway
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Payment Gateway
A payment gateway is capable of linking the online buyer and seller,
each with their respective banks/financial institution. On the other hand,
a payment service is the electronic payments facility offered by an individual
bank/financial institution to its own, existing customers.
A payment gateway is a third party network that acquires transactions
from an e-commerce portal and processes them through the banking or credit
card system. It links the banking network with the Internet. It is a link
into the banking network and is inaccessible to Internet users. It uses
enhanced security features such as digital envelopes and content keys.
The gateway provides an interface between the merchant and the bank's
payment processing system. The payment gateway translates messages into
other message formats (for example, VisaNet) that are used for the authorization
and settlement of merchant transactions. Payment gateway takes a transaction,
then certifies it and routes it after securing it with encryption. It
also manages the translation and decryption. Almost all payment gateways
are based on Secure Electronic Transaction (SET) technology, a system
to ensure the security of financial transactions on the Net.
Secure Payment Gateway Services
You need to either have access to a secure server (SSL) or be signed
up for a Secure Payment Gateway service. Secure Electronic Transaction
(SET) is an encryption technology that helps protect the transfer of payment
information over the Internet. SET technology protects payment information
in four ways: It enables a cardholder to authenticate that a merchant
is authorized to accept payment cards in a secure manner. It enables a
merchant to authenticate the payment card being used in the transaction.
SET uses an advanced encryption system to protect personal payment information
during transfer over the Internet. SET technology makes sure the payment
information is read only by the intended recipient. SET enables both cardholders
and merchants to safely transfer payment information online.
Payment gateway offers you the following benefits:
- Credit card authorization in real time
- Secure links between customer, merchant and bank
- Fast and efficient transaction processing
- Customer refund facilities
- Real-time reports
- Multi-currency settlement if required
How does payment gateway work?
When a customer attempts to buy goods from your shop using a credit or
debit card, payment gateway does three vital things:
- Authorization - Checks that the credit is acceptable.
- Clearing - Passes the transaction to your bank, so that you receive
payment.
- Reporting - Records the transaction and allows you to view it (and
all other transactions) using the payment gateway report facilities.
1. Authorization
Any purchase made with a credit or debit card via payment gateway
must first be authorized by the card issuer. The authorization request
will have one of three answers:
- Accepted - the card is accepted and the sale can go ahead
- Rejected - the card is rejected and cannot be used for this transaction
- Invalid data - there is some problem with the card details supplied
(typically with Switch card issue numbers)
2. Clearing
At the end of each business day payment gateway groups all your
transactions together and sends them off to your bank in a single batch.
The bank then processes the transactions - this process is called clearing.
It typically takes 3 - 5 business days (depending on your bank) for money
to arrive in your bank account.
- Accepted batches
Most batches are accepted without any problem and the payments appear
on your bank statement marked with the date the bank processed them.
This is normally the day after the transaction date. Most bank statements
show only two credits to your account - one is the total of all sales
you made on a particular day using switch cards, the other the total
for credit or visa debit cards.
- Rejected batches
Occasionally a batch of transactions sent to the bank will be rejected.
If this happens payment gateway will rectify any problem and send the
transactions again on the next business day, along with any other transactions
recorded that day. You don't need to do anything yourself. When a rejected
batch is resubmitted and then accepted, the result is that your bank
statement shows a credit which reflects two days worth of sales instead
of one. Don't worry about this. Payment gateway's reporting pages will
help you to check that everything is OK.
3. Reporting
Payment gateway records all transactions and allows you to view
them, print them out or even download them to your own computer for further
processing in a spreadsheet or other application. The basic payment gateway
reports page shows the following transaction facilities:
- All Transactions - every transaction done via your site this week
- Transactions not yet settled - transactions which have not yet been
sent to the bank yet, but are waiting to be sent (typically today's
transactions)
- Settled Transactions - transactions which have been sent to the bank
- Invalid transactions - transactions where authorization was not given,
and which will not be sent to the bank
Access to payment gateway from your website
Merchants access their gateway using one of three methods: Weblink, API,
and Virtual Terminal.
Real-time processing:
Real-time online Internet credit card processing systems include
one or two methods of integrating the gateway to your website.
- "Weblink" methods use HTML to link your site to customizable
payment pages located on a gateway's servers.
- API methods use application program interfaces to transmit
data from payment pages located on your servers to the gateway.
Manual processing: Virtual Terminal Solution
Virtual Terminal solution allows merchants who have Internet
access, to manually enter transactions without the need for an Internet
storefront. This is the perfect solution for merchants who manually
enter credit card transactions for mail or phone order sales.
This method allows you to enter sales one-by-one from any Internet-connected
browser.
The Virtual Terminal is an Internet based application and will
work from any type of computer that has Internet access. This allows complete
automation of credit card processing, issuing invoices and receipts and
you can provide recurring billing and a customer database.
Advantages of virtual terminals:
- Much faster than standard dial-up authorization systems.
- Remove the complexity and expense normally associated with real-time
credit card processing.
- Enter credit card orders manually for those phone, mail and in person
orders you may get.
Payment Gateways:
Some of the more common Secure Payment Gateway services:
Authorize.Net
Authorize.Net is a server-based transaction processing system developed
by NETSolutions International, Inc. that enables businesses with approved
merchant accounts to authorize, process, and manage credit card and electronic
check transactions in a real-time, online environment from any computer
with an Internet connection and a Web browser. There are two basic components
of the Authorize.Net system: Authorize.Net Virtual Terminal and Authorize.Net
WebLink
Authorize.Net WebLink
Existing Internet storefronts can be linked by the supplied HTML code,
or by packaging with our Shopping Cart program you can instantly add
the transaction processing capabilities of Authorize.Net to your Internet
store.
When online customers are ready to purchase products or services from
a merchant's Web site, WebLink either captures the necessary information
(name, credit card number, etc.) from the site's own secure transaction
page or displays a standard WebLink transaction page, hosted on an Authorize.Net
server, for the customer to fill out.
This information is encrypted using 40 or 128 bit Secure Socket Layer
technology and sent to an Authorize.Net transaction server. The server
then sends the data through the authorization network to the appropriate
card issuer's bank over a secure, proprietary connection. When the authorization
process is complete -- this takes around five seconds -- the customer
receives an approval or decline response, and the Authorize.Net server
stores the transaction. Transactions are automatically settled each
day and funded within 2-3 days.
To link a merchant's web site to the Authorize.Net system, you only
need to insert a few lines of HTML code that they provide to establish
the link. Authorize.Net supports most available shopping cart software,
so it integrates easily with most e-commerce solutions.
Merchants can also check the status of transactions or run reports
on past activity by going to the Authorize.Net website and logging on
to their own password-protected Authorize.Net site. Online businesses
can also use the Authorize.Net Virtual Terminal to enter payment information
manually if customers prefer to call in with their credit card information.
Authorize.Net Virtual Terminal
Businesses with an Authorize.Net account simply access the Authorize.Net
Virtual Terminal through their website using any web browser. After
logging on to the system using a unique user ID and password, merchants
can access their services. This includes authorizations for purchases,
credits and returns, status and activity reports, and much more.
To authorize credit card transactions, the merchant completes an electronic
form that provides the Authorize.Net system with the information it
needs to complete the transaction. This information is encrypted using
the latest 40 or 128 bit Secure Socket Layer (SSL) 3.0 technology and
sent to an Authorize.Net host server. The server then sends the data
through the authorization network to the appropriate card issuer's bank
over a secure, proprietary connection. When the process is complete
-- this takes around five seconds -- the merchant receives an authorization
number, and the Authorize.Net server stores the transaction. Transactions
are automatically settled each day and funded within 2-3 days.
Merchants can also check the status of transactions, automatically
bill customers for recurring charges, or run a variety of reports right
from the Authorize.Net Virtual Terminal.
Verisign Payflow Link
Payflow Link enables merchants to connect their consumers to a secure
VeriSign-hosted order form and use it to automate order acceptance, authorization,
processing, and the management of transactions.
Payflow Link provides an easy to use HTTP based solution that is ideal
for businesses processing less than 1,000 transactions per month. Payflow
Link is the solution of choice for merchants looking for a fast and easy
way to conduct secure automated transactions over the Internet.
Payflow Link enables merchants to connect their consumers to a secure
VeriSign-hosted order form and use it to automate order acceptance, authorization,
processing, and the management of transactions. It's as simple as entering
an HTML Hyperlink into your existing Web site.
LinkPoint
LinkPoint enables your business to accept payments for goods and services
through the Internet. They offer several options for you.
LinkPoint Secure Payment Gateway
Startup merchants who want to get online fast, as well as for merchants
who already have a Web site and want a secure, fast and reliable e-commerce
software package. The LinkPoint Secure Payment Gateway translates information
from a merchant¡¯s Web site into a format that can be read
by an electronic processing system.
By operating in real time, a merchant can immediately capture funds
upon delivery of goods to customers. The LinkPoint Secure Payment Gateway
supports all sales, returns, real-time authorizations, captures, batch-settlement
processing and refunds. State-of-the-art technology provides merchants
with benefits which include fraud screening every transaction submitted
and real-time reporting via their Web browsers.
LinkPoint International has created three unique and user-friendly
payment solutions to serve the e-commerce needs of any merchant:
LinkPoint Select API
LinkPoint Select API is preferred by developers, software programmers,
Internet service providers (ISPs) and commerce service providers (CSPs)
with an advanced knowledge of the C or Java programming languages to
integrate secure credit card processing into both simple and complex
e-commerce Web sites. Customers pay for products and services online
with a credit card without ever leaving the merchant¡¯s Web
site. Secure Sockets Layer (SSL) technology is used to encrypt and pass
confidential transactions and order information directly from the e-commerce
site to the LinkPoint Secure Payment Gateway.
The LinkPoint Select API (application programming interface) includes
modules to calculate tax, shipping and to enable the sale of digital
content through electronic softgood downloads (ESDs). In addition, LinkPoint
Select API provides sales, returns, real-time authorizations, purchasing
cards and real-time reports.
LinkPoint Central
LinkPoint Central is a way for merchants to process monetary transactions.
It provides one central, secure location where you can manage everything
related to transaction processing, from running secure transactions
yourself to setting up your web site to run transactions for you, from
preventing fraud to reviewing transaction reports to getting technical
support and help. Everything is readily available right here.
LinkPoint Central incorporates LinkPoint Basic and Virtual LinkPoint,
two of the main processing products available for merchants on the LinkPoint
Secure Payment Gateway, making them easily accessible in one central
location:
LinkPoint Basic
LinkPoint Basic is a payment-posting tool that uses HTML. Ideal for
merchants with Web sites, LinkPoint Basic HTML script can be easily
integrated to enable secure payment processing to the LinkPoint Secure
Payment Gateway. Virtual LinkPoint is provided as part of the LinkPoint
Basic package. In addition, LinkPoint Basic provides sales, returns,
real-time authorizations, purchasing cards and real-time reports.
LinkPoint Basic allows merchants to choose from three different options
for capturing and processing credit card and electronic check information:
- PayOnly - process credit card transactions only
- FullPay - LinkPoint Basic does all the work for you. Merchants
send their basic merchant information and the gateway does the rest.
- PayPlus - collects basic data, as well as transaction, ordering
and shipping information.
| Features |
Advantages |
| Simple
integration |
Makes
any Web site e-commerce- enabled by adding simple HTML code |
| Fraud
protection |
Provides
crucial preventive measures that allow merchants to block specific
credit card numbers and Internet protocol (IP) addresses |
| Address
Verification Service (AVS) |
Allows
the merchant to validate the billing address |
| Reports
and recordkeeping tools |
Provides
real-time management reports via the merchant's Web browser |
| Shopping
cart software vendors |
Many
software companies have integrated LinkPoint Basic into their shopping
cart software to facilitate ease of use and configuration with merchant
Web sites |
| E-mail
notification |
Merchant
and customer are both notified of pending order and transaction
approvals via e-mail |
Virtual LinkPoint
Virtual LinkPoint empowers merchants with the Internet equivalent
of a point-of-sale (POS) terminal and software without the hassle or expense
of hardware/software maintenance. Virtual LinkPoint allows merchants to
manually enter credit card transactions on a PC through a secure connection
to the Internet. Sales, returns, authorizations and real-time reports
are all provided by Virtual LinkPoint. Ideal for the merchant who requires
a PC-based solution, Virtual LinkPoint enables merchants to process credit
card transactions via any Internet-connected computer. Virtual LinkPoint
processes customer orders received from a Web site, telephone, fax, mail
or e-mail, then generates sales, return authorizations and reports through
the LinkPoint Secure Payment Gateway.
| Features |
Advantages |
| Simple
to use |
Merchants
can process credit card transactions without investing in hardware
or software |
| Internet-based--eliminates
the hassles of modem configuration |
Updates
are instantaneous--no hassle with downloading software |
| Real-time
reports and record-keeping tools |
Processes
transactions and accesses reports anytime, anywhere |
| Fraud
Protection |
Provides
crucial preventive measures that allow merchants to block specific
credit cards numbers and Internet protocol (IP) addresses |
| Address
Verification Service (AVS) |
Helps
merchants validate the customer's billing address |
| E-mail
notification (optional)--merchants can send e-mail receipts to customers
when transactions are completed |
Allows
merchants to track credit issuance and shipment confirmation of
hard goods |
Provider:
Cardservice International
Plug'n Pay
PNP's transaction programs have been developed specifically to meet the
needs of today's Internet merchants. They offer an extensive lineup of
programs designed to maximize sales, enhance security, protect merchants
from chargebacks and streamline the management of your site. They were
one of the first to offer this type of service as their only business.
SecurePay
SecurePay provides merchants with an easy to use, secure credit card
processing interface for multiple types of online stores.
SecurePay Highlights
- Secure Credit Card Processing
Since all transactions are processed via a secure server, your customers
will feel more comfortable ordering online.
- Flexible Payment Processing Options
Your Website can automatically process your customers' credit cards,
or you can use the Web terminal for phone, FAX or mail orders.
- Recurring Billing Feature
If you bill your customers the same amount each month, SecurePay can
automatically bill the credit cards for you.
- Shopping Cart Solutions To Fit Your Business Needs
Whether you sell one product or thousands, we have a shopping cart solution
for you. We have carts that can handle multiple options for products,
such as sizes and/or colors, as well as simple one product carts.
- Easily View Transaction History
SecurePay makes it easy for merchants and distributors to view transaction
history reports. Simply enter report criteria like today, this month,
last month, or any one of multiple report criteria and a report will
be generated within a few moments for you to view online.
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