Settlement Services May Differ Company to Company Initial Steps -
Before we take any further step in Visa and MasterCard settlement services, we should understand that the initial step towards a productive integration is to understand the entire payment procedure. When a client gives a credit card as doing payment for items or services, it is just the starting point for multi-layered sequences of under the carpet transactions and data transfers. Ultimately, the result of such a process is that the merchant fetches a condensed payment for service or products sold to the client.
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It is important to know that every transaction starts only when a Cardholder hand overs the card to a Merchant for making the payment of product or a service. The client can give the card in a practical manner in the state of a trade establishment, or he can also give indirectly through web by telling the number of card, expiration date and name given on the card. Then a Merchant either swipes that card via electronic reader or just writes the particularsof the card by hand in a computer or system. The sum of the transaction can also be written or transferred from a (POS) i. e. Point of sale system or just via shopping cart.
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Every Electronic Payment System is attached to a system which belongs to a Processor, and transmits the data of card and transaction. If the task of transaction gets done via web, the Merchant will either be linked to a Processor directly orlink via a Gateway provider which makes arrangement of the data and guides it to the Processor of Merchant. All the single processors possess an exact protocol for such kind of
transmission. The computer system of processor makes sure that the card is valid and there are acceptable fundsavailable for credit in the account of the card owner. Thereafter, the Processor connects an approval or denial code back to system of Merchant, again by using a process limited to that particular Processor. -
Remember, for transactions of some specific industries like in restaurants, there remaintwo segments, first is pre- authorization wherein a measured amount gets approved, and post-authorization where the genuine sum of the transaction gets recorded. It is essential as the amount of tip is nameless at the moment of early authorization. At the completion of every business day, the account of merchant has to be shut or get settled. This thing heavily depends on Processor. It can either get done mechanically or may need retransmission of costs of day. As closing or settlement is done, the Processor tells the acquirer and he begins the process of moving the funds.
Thus, for different businesses and industries, Visa and MasterCard settlement services may differ to some extent but more or less, the basic stages remain the same.
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