What are transaction processing solutions

What Are Transaction Processing Solutions?

Transaction processing, as the name suggests, is a

process of carrying through a transaction from making

a payment for a service or product to the actual

delivery of the same.

Most businesses are carrying out these transactions

online with the help of sophisticated software. This

transaction processing software records every step of

the transaction for future reference.

A good transaction processing solution will not only

record all transactions but will be able to tabulate

and reproduce any or all of them at any given time.

This aids in rectifying any problem or error by

recalling a particular transaction and tracing each

step right down to the point where the mistake was

made and rectifying the same.

Online transaction processing is a very crucial part

of any online business. It is an electronic ledger of

all the business transactions carried out by the

online merchant account.

There are many online merchant transaction processing

solutions available. A merchant may choose to get a

ready-to-use transaction processing software or may

choose to have a customized one made for his online

merchant account. Of course, there are vast cost

implications involved, however there is almost no

difference in the security levels of the two.

It is imperative for an online merchant account to

have a transaction processing solution in order to

transact business online. From accepting an order,

processing payments and getting the cash in the bank,

transaction software is what will get the job done.

Setting up your site to accept online payments

Setting Up Your Site To Accept Online Payments

Once you have your business plan and strategy in place

you may have to get a programmer to make customized

payment software that will enable you to process

online payments.

If you have all this in place you will need to contact

an "Acquiring bank" to complete the infrastructure.

The problem is that you will have to confirm to a

strict list of preconditions the banks lay down in

order for a business to qualify for their online

services.

It is possible that the bank you have your corporate

account with may just refuse you access to their

online payment services. The checklist of

preconditions is sometimes endless and you will do

well to ensure you satisfy all the requirements before

applying to any bank.

You will need to provide the bank with details that

include: the nature of your business, where you expect

the cash to flow in from, explain the details of all

your products and services, assure the bank that you

will deliver the products and services, explain your

terms and conditions for online transactions, give a

detailed estimate of your turnover, how many credit

card or debit card transactions you are expecting,

(See how difficult it becomes)

You will also need to give the bank details of the

secure server you intend to use, and if you do not own

it you are likely to be turned down. The list goes on

an on.

In the end, many online merchants choose to set up an

online merchant account with a third party service

provider. This is invariably free to set up and with

the least trouble.

Setting up your site to accept online payments is in

fact, easier and faster using free payment processors

than it is applying to a bank.

The benefits of an online merchant account

The Benefits Of An Online Merchant Account

The internet has emerged as the largest marketplace

and source for information. It is estimated that about

a million people are being introduced to the internet

every 100 days.

This included emails and search engine services. In

fact, surveys have shown that 80% of all online sales

begin as a search on some major search engine.

It is possible for a business establishment to

advertise, sell and collect payments online without

ever having to meet the customer personally.

Technology has advanced with such a rapid pace in the

past ten years that electronic payments have become

the norm of the day. More than 40% of payments are

transacted electronically through credit and debit

cards, apart from the usual wire transfers and online

payment portals.

One of the emerging payment methods is through mobile

phones. It is fast catching on and experts in the

field feel that this is going to be the preferred

payment method worldwide. Paying through your mobile

handset will be as easy as sending an SMS.

With these advancements and most businesses adapting

their payment procedures and policies to suit

customer’s conveniences, it is only advisable in the

interest of business that any business set up an

online merchant account with a payment processor in

order to cash in on the business that is being

transacted on the Internet.

There are many online merchant solution providers out

there and have established themselves in the field

setting up and maintaining online merchant software

and products that fraud, though exists, is very

difficult to perpetuate.

So get yourself an online merchant account and get a

piece of the action that your competitors will

otherwise get.

What is ach and how is it related to an online merchant account

What Is ‘ACH’ And How Is It Related To An Online Merchant Account

An online merchant account is a business with an

internet presence that accepts payments

electronically.

If any business has an online merchant account they

will need to have a system in place that will process

various credit or debit card payments as well as

online bank transfers.

This is a common account that accepts the payment from

the customer and passes it on to the merchant’s bank

account. This system is referred to as an "Automated

Clearing House".

An ACH is an institution that facilitates or assists

in the transfer of funds from one financial

institution to another. For instance, if you submit a

check from another bank to your bank for payment, the

check will go to the Clearing house in the area.

This intermediary body will authorize the payment that

will be transfered to your bank account. It cuts out

the hassle of you having to go to the bank whose check

you have to get your cash.

Similarly, an ACH assists online merchant accounts to

receive payments from any payment processing service

such as VISA or MasterCard, even various online banks.

An ACH acts as the link between his bank and the

online merchant bank account, to facilitate the

transfer of funds. Whenever a customer authorizes

payment through an online process, such as a credit

card or any electronic means, the ACH ensures that the

payment is validated and that the merchant will

receive his payment in due course.

Many online merchants have chosen to use free online

payment processors to cut on costs of setting up their

own payment gateways. Though the process is free, the

payment transactions still have to go through the ACH

in order for the merchant to receive his payment.

This is a very secure way of transacting online and is

catching on very fast. In fact, accepting payments

online is as easy as accepting cash over the counter,

only this way the merchant does not have to go to the

bank to deposit the money, the ACH does it for him.

How to open an online merchant account

How To Open An Online Merchant Account

An online merchant account is an account that is known

as a "Payment Gateway". It is not a very difficult

task to open an online merchant account.

A payment gateway is a software that your web

developer or engineer will have to incorporate into

your web site.

This is software that may or may not include a

shopping cart, a system that allows visitors to your

online merchant site to browse through your products

and add them to a virtual cart, much like a shopping

cart at a super mall.

The visitor will ultimately keep or remove items from

the cart and pay for the remaining items through the

payment gateway.

A payment gateway may or may not be linked to your

merchant bank account. This depends on the type of

online merchant solution you have chosen. You may have

had the software created especially for your site; in

this case the software will naturally accept all

credit cards and will be linked to the major credit

card processing companies such as VISA or MasterCard.

The software will also be linked to your merchant bank

account. Customers can use this software to pay for

services and products using credit cards, debit cards

and bank transfers.

When someone uses a card or online banking to make a

payment the user is connected to the bank that issues

the card and the money is transferred to the bank

within a matter of days. Nevertheless, you may go

ahead and complete the transaction by delivering the

product to the customer as the payment will definitely

come through.

Online merchant solutions are a way of taking your

business to your customers instead of waiting for them

to come to you. The online payment systems are an

added advantage as anyone will like to have

convenience at their fingertips.

What are the security risks of online merchant accounts

What Are The Security Risks Of Online Merchant Accounts?

Online security has advanced a great deal in the past

ten years or so. Online merchant solutions have taken

the best advantage of this advancement in technology

by allowing many online businesses to take advantage

of the convenience of accepting payments online and

delivering goods to their customers without actually

meeting them.

However, as with every positive point to any

development there are a few negatives as well. Though

merchant transactions on the internet has improved to

prevent online theft, popularly referred to as ‘cyber

theft’, there are ‘gurus’ in the field of software

development who would rather lend their expertise and

knowledge to hacking or breaking into online

businesses and online payment processors to steal and

plunder.

Many online merchant establishments have experienced

their digital products, such as PDF files, music,

video and what not being downloaded by cyber criminals

who have somehow managed to circumnavigate their

secure payment gateways, thus causing a loss to the

online merchant establishment.

Many online payment processors have also experienced

theft by people breaking into their client’s accounts

and transferring cash online. Online credit card fraud

is also nothing new to online merchant transactions.

The answer to preventing online merchant fraud is to

use a reliable service that has proven their expertise

in the field of online merchant solutions. They will

have to have honed their skills in developing SSL

technology.

This is an Acronym for ‘Secure Socket Layer’

technology. SSL encrypts the data being transmitted

over the net and is almost impossible to decipher.

This actually reduces online fraud considerably.

If you have a reliable developer to create your

software for you, you can proceed with your plans of

setting up an online merchant account and cash in on

many deals your competitors are profiting by at the

moment.

Online merchants beware of phishing

Online Merchants Beware Of ‘Phishing’

Businesses with online merchant accounts must beware

of a process called ‘Phishing’. This is a fraudulent

activity many cyber thieves resort to in order to

cheat you of your online funds and products.

The process is simple and is designed to take you

unawares. Though ‘Phishing’ is an illegal activity and

any one engaging in it is liable to be punished by

law, catching the crook is the crux of the matter.

‘Phishers’ send out hundreds of emails to unsuspecting

people asking for personal details such as mother’s

maiden names, surnames, date of birth credit card

numbers etc. The intention is to use this information

to try and crack online passwords. ' Many online

merchants have had their online payment processing

accounts hacked only because they fell for one of the

many ‘Phishing’ tactics online.

A ‘Phisher’ will send out hundreds of mails disguised

as a message or even a page that looks like a payment

processor page or an online bank login page. The

content mail will probably try to fool the user (by

asking them to login and change their password) into

logging into their online account by entering their

username and password.

When the ‘submit’ button is clicked, instead of the

account page being opened, nothing happens, or so many

people think. What has in fact happened is that the

password and username has been emailed to some distant

account and may be used in a matter of minutes to log

in and change the password of the account by the

‘Phisher’.

There is only one way to avoid this and that is to

close all internet applications and log into your

online merchant account site by manually typing in the

URL of the site. Never click on an email link to go to

your merchant account site.

Internet payment gateways should you make your own in house

Internet Payment Gateways - Should You Make Your Own In-house

An internet payment gateway is crucial for any online

merchant account to facilitate selling goods and

accepting payment for the same. This is known as

e-commerce.

This process is like any sale made in a physical

store, where someone buys a product and passes his or

her card to the check out clerk for payment. Only with

an Internet payment gateway, the customer does not

have to pass his card over but just enter the card

data into a secure online form.

This data will include the card number, name of the

holder and the CVV number on the rear of the card. The

payment will be debited from the card and in a matter

of days, will be credited to the merchant’s bank

account.

From a security aspect, online payment gateways are

quite secure, though the customer should be certain

that he or she is using a reputed site. Look for the

‘s’ after the ‘http’ in the URL of the site.

This is a start but not a guarantee to prevent the

site from using your card information for illicit

purposes. So does it make a difference if you make

your own Internet payment gateway in-house? Perhaps

yes.

This will give the net savvy customer a feel that you

have taken the trouble of developing your own secure

software instead of just getting one off the net. It

will also merge with your site design instead of

displaying other third party ads and logos on your

site.

It may cost you a little more, but you will be

offering your online customers a sense of security and

will have full control of the software. So you will

not have to wait for the third party to wake up to

rectify any fault in the online processing solution

they have set up for you.

How to create and add a shopping cart to a site

How To Create And Add A Shopping Cart To A Site

There are many solutions to adding a shopping cart to

an online merchant site. You may want a very

personalized shopping cart for your portal and so will

have to hire the expert services of a software

programmer.

There are many online merchant solution service

providers out there and can have your shopping cart

software and payment gateway set up and running in a

matter of days, but it is bound to cost you.

Then there are free online merchant solutions

available such as the many online payment services.

PayPal is one such solution and a very trusted one.

With the free online merchant solutions available you

do not have to make a payment up front. These services

charge you a percentage of the payments you receive

online.

They have ready made software that is easy to install

on your site. You just have to fill in an online form

that requires some details of your business and

payment procedures.

They will then provide you with software code that is

generated instantly. You have to just copy and paste

this code in the html code of you site.

The online payment processor will guide you how to do

this as well. When you are done, you will be able to

accept payments from customers through credit cards

and debit cards. The difference with the free payment

processors and customized online merchant software is

that the money will not be deposited into your bank

directly.

The payment will go to the online free payment

processors account and you will have to withdraw it

from there to your bank account for which there will

invariably be a charge.

These are good solutions for small online businesses

as it beats paying huge software development costs.

What is a shopping cart

What Is A "Shopping Cart"

A "Shopping Cart" is software that offers the online

customer the convenience of collecting the items they

want to purchase in one location.

After they have browsed through the online merchant"s

store, they may or may not want to delete some items

before checking out and making payment.

This is very much like the physical "shopping cart"

you will find at the super markets around the world.

You walk around "browsing" through the isles and

adding things you want to purchase to the cart. Then

when you check out and make payments at the counter

you may decide you do not want some of the items, you

just leave them at the counter and pay for the rest.

An online merchant account will have a similar

"shopping cart" you can use while browsing for goods

online. You add the items to the shopping cart by

clicking on an "Add to Cart" button. Then you can

delete items from the cart if you want to.

As you proceed with your online shopping at the portal

the "shopping cart" software will automatically add up

the amount you have to pay, this way you can keep a

track of your budget.

When you are done, you must choose to pay for the

goods in the shopping cart. This is a payment link on

the portal that when clicked will take you to the

payment gateway.

This gateway will offer you many payment choices such

as, paying by credit card, online bank transfer, debit

card or some other online payment processor such as

PayPal etc.

When you choose one of these the online merchant

payment software will guide you through the entire

process and then returns you to the portal from where

you can download the goods you have bought or the

portal will issue you a receipt and mail the physical

goods to your address.