Accepting Online Payments
Overview
In order to better understand the process of online transactions the following is the breakdown of a typical online
purchase:
- A consumer visits your website and uses your online store/shopping cart software to purchase goods or services.
- The transaction is conducted over a secure connection (SSL) using a Digital Certificate to your web hosting server.
- A Payment Processing Gateway handles the secure, real time encrypted credit card information and co-ordinates the transaction
- Merchant account processes the movement of funds
- Funds are removed from the shoppers credit card account
- Funds are then deposited into the bank account associated with your Payment Gateway
In order to receive and process online payments the following are required:
- Checking account
- Merchant account
- Payment Gateway account
After the above accounts have been opened, you are ready to configure the new E-commerce Web site to work
with the accounts to accept payments from online customers.
When selecting providers for your Checking account, Merchant account, and Payment Gateway account, you need
to be sure that the different companies are compatible with each other. Not all Merchant accounts and Payment
Gateways will work together. If you are unsure about the e-commerce software you are working with, most of
this information is available on the specific vendor’s web site or by contacting them.
There is usually a fee associated with the Merchant account and the Payment Gateway. Doing your homework will
serve you well when making your final decision about which Merchant Account and Payment Gateway to recommend
to your client. This is either a percentage of each transaction or a set fee of around 2% and .30 respectively.
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