How the Credit Card Processing Flow Works

Credits for this image go to Credit Card Processing Blog Credit card companies are
well known for being the provider of electronic charge cards to millions. However,
these companies are not the only business entity involved in the actual processing
credit card transaction. The process involves multiple players,
including merchants, credit card processers, credit companies that provide the
related lending, and eventually the cardholder’s bank.
The credit card transaction starts well before any purchase occurs. The first player
in the process is the issuing bank that provides the credit card to an individual
buyer in the first place. The card is issued and synced with the credit card company
once an account number is designated to the individual. The issuing bank will also
be the collector of debt when the account balance comes due.
The Purchase Itself
With the card the buyer goes to a merchant and makes a purchase. The merchant
already has a merchant account established with another issuing bank synced with
another credit card company, allowing the merchant to accept credit cards. As the
buyer’s card is swiped, the data is transmitted via specialized equipment to an
authorization network. This allows an exchange and validation with the issuing
bank to make sure that there’s enough balance to charge against and that the
purchase in question is allowed. This step allows an issuing bank to give an
electronic green light or block the purchase before it occurs. When it gets blocked,
the merchant receives a message that the card has been denied. If green-lighted, the
transaction reads as “approved.”
The Payment
Once the transaction is approved or denied, the data is sent back to the
merchant’s processing machine to be read. At the same time the transaction and
related data are also recorded by the authorization system to create an archive for
the cardholder, the merchant, and the issuing bank. When “approved” the merchant
knows he can hand over the product bought by the customer. A receipt is produced
as a paper record as well.
 In the meantime, the issuing bank sends the necessary funds through an
interchange system to the merchant’s account or acquiring bank to pay for the
goods. The interchange system shaves off a small percentage from the merchant’s
payment to pay for the service. Merchants who don’t want to eat this cost then
mark up their prices slightly to make the customer pay for the processing fee.
Conclusion
Because the above processing occurs electronically, the system can usually handle
thousands of transactions hourly and millions daily. This integrated approach
allows millions of buyers to purchase services and product every day, moving
money from their line of credit to merchants all over the nation and the world.
As a matter of fact, Credit Card Processing is an extremely complex process. It
involves multiple steps to complete. In general, Credit Card Processing will follow
four steps. The merchant bank, the credit card processor, the card networks.
Consumer bank plays crucial role in processing credit card. Now a days, Credit
cards are in use all over the world. It also plays a key role in our lives. We cannot
deny that it made our work very easy.
Moreover, Dealing with technology and managing complex systems is part of
modern life. Not all credit card processors offer 24/7 live customer support. But,
International Payment Gateway provides you 24/7 customer support. Besides,
Credit card transactions will happen in 15 seconds.
First of all, information passes from the cardholder and flows through the
merchant’s bank. Then, credit card networks to the cardholder’s bank. Once that
bank approves or denies the transaction. It flows in reverse back through the same
chain to the merchant. To clarify, them know if the payment went through.
 Benefits Of Credit Card Processing

 First Of All, IPG is fast and secure. IPG provides multiple ways to the
customers.
 First and foremost IPG is a third party merchant account. Third parties
involve in credit card processing.
 Uniquely, it’s charges are low. It facilitates their customers in an convenient
way.
 Importantly, there is no cancellation fees. We provide 24/7 customer
support. IPG do Settle Monthly/Weekly/Daily depends on Volume.
 We accept all Global Debit, Credit and Prepaid Cards on our Safe & Secure
Payment Platform.
 IPG have most Shopping cart Modules available. Our API is easy to use. It
enables merchants to process consumer payments.
 Last but not least, PCI, DSS details security requirements for business
owners. It stores, process or transmits cardholder data.