You Don’t Know this Inside Story of Card Payment Processing in the UK!

Plastic is the future. Soon you’ll end up buying a strip of gum by hovering your card over the machine. Every single store is going to have a card swipe machine in no time. Before you swipe the next time out though, just know that you’re paying for whatever you’re purchasing straight. Someone else is paying up for you too.

You read that right. Welcome to the world of card payment processing in the UK. Believe it, there’s a lot going on and there’re quite a lot of things which you should know.

Who pays for my purchases?

Ever read ‘The Merchant of Venice’? Well, these are merchants too, albeit nicer ones. They pay up for you every time you swipe your card.

These merchants are the ones who provide not only these machines but a lot more as well. Machines are just the point of reference between you as a buyer and the business.

Here’s what happens!

• You make your purchase. Nope, wrong. A merchant makes your purchase for you. You’re just initiating a transaction.
• That merchant forwards the transaction details to your bank who matches it against your purchase.
• Your bank pays up that merchant as per that transaction.
• That merchant returns the amount minus their service fees as per the payment gateway fees in the UK back to the business.

Get the drift; this is what happens. So, next time out, do thank merchant services. Without them, you’d still be looking for sparsely usable notes in your rarely used pockets!

How does a merchant account payment gateway function for transactions?

A merchant account payment gateway provides you and your customers with an electronic payment option. In a modern economic domain where electronic transactions are a continuously increasing figure, you need to integrate one into your business setup. But to get the best of it, you need to know how they function first.

Inner workings of merchant payment gateways: 9 pointers.

• Shopper Buys –

A shopper can use numerous payment procedures from cards to even e-checks. Top merchants are compatible with every single popular format. Either way, a shopper pays up and buys from you.

• Merchant account kicks in –

The merchant account kicks in against a shopper’s initiation of that transaction.

• Payment Gateway –

That merchant pays up for your shopper through a payment gateway linking to that merchant’s account for the transaction. 

• Hosting on card or e-transaction network –

This whole process hosts onto the card or e-transaction network. Retailers like you cannot host the shoppers’ payment information to exact payments. Merchants do it to access their return of that transaction payment. 

• Payment Processing –

The merchant’s payment goes through authorization linking them to the bank in question, i.e. the shopper’s bank.

• Funds Acquirer –

A mediating party functioning in between merchants and financial institutions acquires the initiation order to mediate transaction funds.

• Authorization –

Final authorization takes place, starting all the way from your shopper buying goods from you against the funds in concern, which your merchant pays. 

• Issuer Bank –

This whole procedure reaches that shopper’s bank whence they release the funds as per the shopper’s payment. Point worth mentioning; this amount is void of taxes which was applied when the shopper bought the goods from you.

• Merchant Account Funds –

The merchant initiating, mediating and processing this transaction finally gets back the funds which they offered up so that shopper can buy from you.

So, this is a brief 9-pointer procedural break-up of the basic steps which happen every single time your consumer buys something from you. You pay a certain fee to them but what you get in return is their services allowing your consumers to buy from you any way they want.