Card Payment Basics

In today’s marketplace, merchants are faced with a complex set of terminology and conflicting information when they look to set-up their payment processing options.  From the most complex integrated solution to a stand alone POS terminal, all card payments follow the same simple steps.

How a Payment Card Transaction Works:

1. A cardholder purchases goods or services from a merchant.
2. The merchant sends the transaction information to an Acquirer (Merchant Bank) and is reimbursed for the sale less a “discount fee”.
3. The Acquirer submits the transaction to the Issuing Bank for payment via either the MasterCard or Visa settlement system.
4. The Issuer pays the Acquirer for the purchase less the interchange fee, through the settlement system
5. The cardholder repays the Issuer for the goods or services originally purchased from the merchant.

Click on the diagram below to learn more about the payment process.

Merchants, large and small, established and brand new, benefit from accepting payment cards and telling their customers about it:

• Increased Sales – Customers spend more when they’re not restricted by cash on hand.  Accepting payment drives a higher average ticket for your business and supports additional purchases that might not otherwise have been made.
• Customer Satisfaction – Today’s customers demand the flexibility to pay how, where and when they want.  Whether it’s by debit or credit card or a specialty product, happy customers will be loyal customers.
• Operating Efficiencies – Electronic transactions save you time and money by automating many store procedures, speeding the checkout lines and getting you paid faster.
• Safety and Slippage – Electronic payments keep cash on hand at a minimum and reduce the opportunity for clerical mistakes and pilfering.

Integrated Payments Solutions for Your Business

Merchants are faced with an ever-shifting series of options for their electronic payment processing.  PPI specializes in matching the optimal solution to a new merchant’s processing needs and then continually supports those evolving payment needs into the future.

Payment Processing Terminology - reference our comprehensive library of payment terms

FAQs - get answers to your most commonly asked questions

Card Settlement Process - Click here for details

Credit Cards 101 Presentation - Click here to download