Credit Card Processing Hardware and Software: What Does Your Business
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Posted On :
Feb-24-2010
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Article Word Count :
840
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If you have a wireless account, you’ll have three basic options. In the first option, credit card information can be entered directly through the keypad of the cell phone or other mobile device; in essence, the phone becomes the terminal.
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So you’ve decided to open a merchant account and begin accepting credit cards for your business. Smart move. With consumers moving increasingly toward credit cards as their primary means of purchase for most all items – even mundane items, like groceries and toiletries – accepting credit cards is a smart and relatively simple way to guarantee yourself and your business a bigger piece of the pie and a greater share of the profits.
The first step, once you’ve decided to accept cards, is to locate a merchant account provider and open a merchant account. Once your account is open, there are just a few more simple steps to take before you can successfully begin accepting and processing credit card transactions.
While the merchant account is the interface that facilitates the transmission of information from your store to the credit card provider, and then transfers the proceeds from those sales to your business bank account, you need to have equipment or software that is specifically designed to accept the credit card information and then “tell” the account what to do. The type of equipment and/or software that you’ll need depends upon the type of business you have.
Retail
If you have a retail establishment, most likely you’ll opt for a physical terminal that accepts the card and reads the information on it. The most familiar terminal is the point-of-sale (POS) terminal, which is also commonly referred to as a “swipe” terminal. This type of POS terminal needs an electrical outlet and a phone line to operate. This countertop unit has a slot that allows the card to be “swiped” through, and contains a card reader that picks up the information encrypted in the card’s magnetic strip and transmits it to the credit card issuer. Once the information is “read,” it is transmitted via the telephone line to the card issuer, via the merchant account provider. The card issuer’s computers review the information from the card, as well as the transaction amount. If the card is valid, has not expired, is not “marked” as being stolen or suspended, and if the account has enough remaining credit to cover the cost of the transaction, the transaction is authorized and approved, and the approval and a unique authorization code are transmitted back to the merchant. The receipt is printed and, from the customer’s viewpoint, the transaction is completed. All of this occurs usually in less than a minute.
From the merchant’s point of view, although the actual transaction is complete, the entire sequence of events is not over. At some point in the day – most often at midnight, but sometimes at another time during the business day – the merchant account tallies up the day’s credit card transactions, deducts the applicable fees, and then transfers the remaining proceeds to the business bank account. Now, the transaction is truly complete.
Internet
Internet businesses have two options: the gateway provider, which allows for credit card processing to be performed automatically and in “real-time,” and a virtual terminal, which allows customers to enter their credit card information on your website, but which requires you or your representative to submit the information to the card issuer yourself, later in the day. Accounts using gateway providers are ideal for businesses with a large number of sales each day, and are usually more expensive than those which use a virtual terminal.
Mail Order / Telephone Order (MOTO)
The virtual terminal is the equipment most often used by these businesses. When an order comes in via phone or mail the business owner or a clerk enters the credit card information directly into the computer or, in some cases, through a standalone terminal with a keypad.
Mobile or Wireless
If you have a wireless account, you’ll have three basic options. In the first option, credit card information can be entered directly through the keypad of the cell phone or other mobile device; in essence, the phone becomes the terminal. Some merchants prefer to use a separate terminal that attaches to the mobile device, while still others forego the terminal entirely and use their laptop computer with a wireless connection to enter and process credit card information. Costs vary based on the system you select.
All of these solutions require software to facilitate the transfer of information from the business’ storefront to the card issuer. Some, like the retail POS terminal or wireless terminal, also require hardware, which may be leased or purchased.
As we move more and more toward a cashless society, the ability to accept credit cards – and even debit cards – is becoming increasingly necessary. The time to setup a merchant account and install the hardware and software necessary to maintain the account is minimal. The type of equipment you need will vary depending upon your operation, but a qualified merchant account provider can review your needs and make the right recommendations that will keep you competitive in today’s marketplace.
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Article Source :
http://www.articleseen.com/Article_Credit Card Processing Hardware and Software: What Does Your Business _11796.aspx
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Author Resource :
Karen Zabel is a freelance writer who writes about Credit Card Processing Service.
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Keywords :
Credit Card Processing Service, Merchant Accounts, Credit Card Processing,
Category :
Business
:
Business
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