Credit Card Processing...Simplified

If you want to be worth your weight in gold as a merchant in today's economic arena, accepting credit cards as a payment option is a practical must. It allows your customers greater ease in payment for your services and can create greater spending on their part. It also permits your company to accept orders via telephone and the Internet as well as allows for increased business credibility.

How to Become a Credit Card Merchant?

Credit card processing involves a variety of steps, starting first and foremost with customers involvement, and their possession of a major credit card from an issuing bank. You, as the merchant, obtain a merchant account from a sponsoring bank or an acquiring bank (both referred to as Merchant Banks) that will sponsor you as a business qualified to accept credit cards.

Many of these merchant banks use processors, third party services, to process the credit card transactions through the banking system for your company. The processors will take a small percentage of this sale, which will be subtracted from the overall transaction amount.  After the sale is completed, and all the necessary processing has been completed you will receive a net settlement amount deposited into your account. Once your company is set up to receive credit card payments the process of purchase is simple and generally complete in a matter of seconds.

Protecting Yourself from Chargebacks

In some cases the customer may believe that a charge is not legitimate, or that they did not receive the goods or services promised. Thus, they can return to you for a refund. In other instances, they may also appeal to the issuing bank for a Chargeback. These types of complaints can be troublesome for you as the merchant, if not handled correctly.

Common causes can range anywhere from a discrepancy in the way your companys name appears on advertisements, receipts, or customers credit card.  Another common cause is charging a customer for the goods before they have been shipped. You can prevent this by not submitting the deposit transaction before you the goods have been shipped or you have performed the service.

In these two cases, the matter can be resolved through the retrieval request sent by the bank to your processor. You must provide proof that the goods or service were delivered; proof generally consists of a document (such as delivery receipt, credit card receipt and/or store receipt) signed by the cardholder. Once this documentation is provided, the matter is settled. Protect yourself from these types of complaints by enforcing and advertising your return and warranty policies.

Remember, time is of the essence in such matters. If you do not deliver the required documents in a allotted time, the customer will be deemed as right and the credit card company will deduct the amount from your bank account. Chargebacks will be noted on your account record, and if the chargebacks become prevalent your merchant bank will terminate your account. 

Reaping the Benefits of Credit Card Transactions: It's A Win-Win Situation!

Teamed with strong and ethical business practices, credit card processing can be a win-win situation for all the parties involved. One of the most important aspects of credit cards is that they offer protection to you (the merchant), your customers, and the banks involved. The consumer is provided with a fail-safe against fraud and unlawful merchant practices.  You can be sure to receive youll receive the funds once the transaction is complete. When you take the necessary steps to meet the expectations of your customers everyone wins!