Deep dives into payment processing, PCI, fees, gateways, POS, and chargebacks. Examples may mention providers like Elavon, Stripe, PayPal, and Adyen for context.
1) Authorization — A card is tapped, dipped, or entered online. The acquirer routes the auth to the issuer via the network. 2) Clearing — Approved transactions are grouped and submitted. 3) Settlement — Funds move to the merchant account (typically T+1 to T+3). Payout reports help reconcile deposits.
Tip: Tokenization replaces card data with a surrogate, reducing PCI scope and enabling subscriptions and one‑click pay.
Interchange goes to issuing banks; scheme fees go to card networks; markup is the processor’s revenue. Pricing may be flat (blended) or Interchange++ (pass‑through plus fixed markup). Effective rate = total fees / total volume.
Most small merchants complete an SAQ: SAQ A (fully hosted), SAQ A‑EP (hosted fields), SAQ B/B‑IP (simple terminals), SAQ C/C‑VT (apps/virtual terminals), SAQ D (everything else). E2EE/P2PE protects data in transit, and 3‑D Secure adds an authentication step for CNP transactions.
Gateways provide hosted pages, client‑side SDKs, webhooks, and reporting. Look for vaulting, recurring billing, APMs, and developer experience. Some processors offer proprietary gateways; others work with third‑party options.
From countertop terminals to tablet systems and mPOS readers — evaluate inventory, tipping, offline mode, and integrations with accounting/ecommerce. For unattended cases, ensure EMV/contactless support.
Prevent fraud with AVS/CVV, clear descriptors, prompt shipping with tracking, and responsive support. For representment, gather strong evidence and respond within network timelines; track outcomes to improve policies.