ONLINE PAYMENT PROCESSING
The most common question among merchants is, why choose a "virtual" credit card machine instead of the typical stand-alone credit card machines? The greatest benefit of using a virtual merchant console is that it provides the merchant with the ability to process payments for sales from any computer in the world with an internet connection and securely store card data for future reporting anytime, anywhere. Processing online gives a company mobility and scalability that a stand-alone credit card machine simply cannot provide.
Below are the typical steps that take place in a merchant and customer payment sales transaction:
Step 1 Consumer Gives Payment Card to Merchant
The first step involved in a sales transaction is the acceptance of credit card or other payment card information by a merchant as a means of payment for products or services. The merchant can receive this payment through such methods as an online store, e-payment form, wireless retail via mobile telephone, retail via software, retail via IP terminal or mail/telephone order via virtual terminal.
Step 2 Merchant Requests Authorization of Payment Card
Once the merchant receives the credit or payment card, an authorization must be given for the funds to be properly held for the merchant. This authorization request is performed by the gateway, which takes the card information securely and requests an authorization from the issuing bank of the credit card.
Step 3 Issuing Bank Provides Authorization of Payment Card
If the credit or payment card is approved, the card's issuing bank generates an authorization code and sends it back to the gateway. This authorization, along with other security verification, such as address verification (AVS) and card identification verification (CVV), are then given back to the merchant.
Step 4 Merchant Provides Consumer Goods or Services Purchased
Once the credit or payment card has been authorized and the merchant has received the approval with an authorization code, it is up to the merchant to provide the consumer with the goods and services the customer has purchased.
Step 5 Settlement of the Sales Transaction
Upon completion of the sales transaction and transfer of goods or services, the merchant must settle the transaction in order to complete the sale and initiate the transfer of funds from the consumer's credit card account to the merchant's bank account.
Step 6 Transfer of Funds from Issuing Bank to Merchant Bank
Typically 1-2 work days after a transaction is settled, the issuing bank will transfer the authorized funds to the merchant's merchant service bank.
Step 7 Deposit of Funds from Merchant Bank to Merchant
When the merchant service bank receives the transaction from credit or payment card’s issuing bank, it will then transfer those funds into the bank account on file for the merchant. This is the final step of processing of a credit or payment card transaction.
Virtual Terminals
In the simplest terms, the virtual terminal can be thought of as a credit card machine that runs online. It has all the functions of a credit card machine with added tools, versatility and customization.
The virtual terminal starts with the basics that every merchant needs. These basic functions include the ability to process a sale, void, credit, authorization-only, positive-authorization and settlement; which are all of the functions of a credit card processing machine but in the case of a virtual terminal, it's all done online.
Reports
The virtual terminal also allows merchants to view a wide array of different reports. Transactions for reports are stored for the life of the account and merchants can decide to either view a report for their entire processing history or view a report for just the past day. Visual reports with graphs and charts make it easy for any merchant to see their transaction history. Expert users can create custom reports with specific criteria to fit any merchant's reporting needs and any report can be printed, e-mailed or downloaded at any time.
Customer Billing Database
Without having to install any additional software, virtual terminals allow merchants to create a customer database as well as to create and maintain auto-billing cycles for those customers. Customers can be auto-billed on a daily, weekly, monthly, bi-monthly, quarterly, bi-annual or annual basis. This feature works especially well for membership companies and time-payment merchants who allow their customers to pay in installments.
Batch Uploading
Whether you need to upload a file of ten transactions or ten thousand transactions, the batch uploader allows you to do so. Built into the virtual terminal, the batch uploader allows merchants to upload files of transactions in supported formats, such as comma and tab limited, and then process them without having to key them in one at a time. This is good for merchants who do not authorize in real-time or who prefer to upload batches of transactions at one time, such as fulfillment center.
Multiple Payment Methods
Customers these days usually employ multiple payment methods that they use to spend for products and bills; this is why the customer billing database allows the merchant to retain multiple payment methods on file for every customer. The database will allow multiple payment cards, as well as checking accounts, to be stored for a single customer and lets the merchant setup a "default" payment method, as well as "automatic backup," in case the default is declined or results in an error. By storing multiple payment methods, the customer billing database allows merchants to feel safe and secure in the knowledge that they will always be able to get their payments on time without having to hassle their customers or repeatedly enter billing information.
Security
Along with being PCI Complaint, the virtual terminal runs on the highest level of security, uses the best in 1024-bit SSL Digital ID encryption for all transaction processing and goes far beyond the minimum industry standards. Since every single payment form is hosted on secure servers, each one is automatically secured by the SSL certificates on the servers. The form also supports another layer of security with an MD5 encrypted hash that prevents vandals from misusing your merchant's form on a different website.
In addition to basic site encryption, the virtual terminal forms collect all of the customer credit card data. Since the virtual terminal forms collect the data, and are hosted on secure servers, they automatically fall under PCI DSS compliance. The servers are also reliable in up-time, so merchants don't have to worry about their payment form ever being down and unavailable.
NDMS and its partners are proud to provide Level-1 PCI compliant gateways. With that certification, we can securely store sensitive information, such as credit card numbers. The customer billing database also falls under our PCI compliance, since it is built into the gateway interface. Many merchants may still be using older software to store customers’ credit card data locally on their virtual machine or in non-secure databases. The customer billing database system provided allows merchants to easily upload their existing customers into our secure system without having to worry about paying high PCI dues for staying with older, out-of-date software or systems. Since the data is stored on the gateway, the merchant can also rest assured that our redundant systems will never lose their data and that it can be accessed through any computer with an internet connection.
Easy to Use and Advanced Interface
The customer billing database has one of the most friendly and easy-to-use user interfaces, but also provides advanced features available to merchants. Preventing fraud is one of the main priorities for gateways.
Address Verification System
The Address Verification System or AVS is an automatic system that verifies that the billing address entered by a payment card holder matches the address on file for the card being processed. The merchant will receive results for the street address and the zip code. The merchant can go one step further and choose to reject transactions that do not meet required AVS responses within the Fraud Center's AVS Module.
Payment Card ID [CVV2/ CVC2/ CID]
The card ID is the 3 digit number located on the back of Visa, MasterCard and Discover credit cards or the 4 digit number located on the front of an American Express card. The card ID verification is also an automatic verification system that is concurrently processed with every transaction. As with AVS, the merchant can block transactions based on the card ID results within the Fraud Center's Card ID Module. Some credit card issuing banks will automatically decline their cards' transactions if the card ID result is a "No Match."
Buyer Authentication
NDMS is proud to support the Verified by Visa and MasterCard SecureCode programs. These programs drastically reduce liability from the unauthorized use of credit cards. By adding this extra layer of protection, merchants safeguard themselves from the costs associated with fraud. You can find out more about this additional form of fraud prevention at our Verified by Visa and MasterCard SecureCode information page.
Ready to lose the liability? Join the thousands of merchants who have already protected themselves from fraudulent transactions. Just click the sign-up link to the left to get started with the Verified by Visa and MasterCard SecureCode programs.
