How Credit Card Processing Occurs
While I was a kid, the only cartoon songs I listened to on television have been in Japanese. Nowadays, a musical band in cartoon shows offers tips on money issues. I've figured out things on cost management from said band's music video clips. Although by now, I ought to know the basics of how to regulate money, I've found the budgeting tips from their songs still helpful. Because their target audiences are children, the animated band known as "Cha-ching" can also explain how PDQ machines work without any trouble. Their message is often that easy to figure out.
I won't be singing a song right now but it would be much easier if credit card processing has got its own story in music form, this way learning it won't be challenging. This kind of process commences with someone buying something at the store. To have a clearer idea, let's assume a person purchases a disco ball just for 50 dollars. A cashier takes his credit card and swipes it on a machine.
The next step is about electronic codes which the device deciphers. Absolutely no humans have a hand in this stage. Once the credit card machine recognizes that a certain 'Mr. Robot' is purchasing, it sends out electronic communications to his bank. In super speed such as the one in online card processing, the device requests his banking institution to transmit 50 dollars. The banking institution knows that men who buy disco balls for 50 bucks are smooth operators thus it transmits the still undetectable cash.
Mr. Robot's banking institution sends cash not actually to the cashier, yet to the bank of the disco store referred to as the merchant's bank. The third step is now between banking institutions. The shop's account in the merchant bank, known as the merchant account, may get around 49.80 bucks following a 2% rate. The 20 cents applied in line with the 2% rate is a part of the card processing fees that the customer's banking institution would make money from and which the shop pays for. Individuals have to spend, businesses have to offer for sale, and banks have to earn from each of them.
It is how it works and that is how it ought to be. The fourth step is still between banking institutions yet it's the credit card company and the customer's bank this time. Because the merchant bank gave the client's banking institution twenty cents, Mr. Robot's banking institution has to provide the credit card provider 10 cents. They have agreed so to begin with but we didn't know about it since we were way too rather busy shopping.
The fifth step is adjusting the rate and currency to the figures of the country you live in. In Germany, for instance, not many people and stores are familiar with processing credit cards. The handling fee may not at all be found in such scenario. Other elements likewise affect the processing cost but if I tried to explain and listed them all by using methodical terms, it won't rhyme any longer and translate well into a tune.
I won't be singing a song right now but it would be much easier if credit card processing has got its own story in music form, this way learning it won't be challenging. This kind of process commences with someone buying something at the store. To have a clearer idea, let's assume a person purchases a disco ball just for 50 dollars. A cashier takes his credit card and swipes it on a machine.
The next step is about electronic codes which the device deciphers. Absolutely no humans have a hand in this stage. Once the credit card machine recognizes that a certain 'Mr. Robot' is purchasing, it sends out electronic communications to his bank. In super speed such as the one in online card processing, the device requests his banking institution to transmit 50 dollars. The banking institution knows that men who buy disco balls for 50 bucks are smooth operators thus it transmits the still undetectable cash.
Mr. Robot's banking institution sends cash not actually to the cashier, yet to the bank of the disco store referred to as the merchant's bank. The third step is now between banking institutions. The shop's account in the merchant bank, known as the merchant account, may get around 49.80 bucks following a 2% rate. The 20 cents applied in line with the 2% rate is a part of the card processing fees that the customer's banking institution would make money from and which the shop pays for. Individuals have to spend, businesses have to offer for sale, and banks have to earn from each of them.
It is how it works and that is how it ought to be. The fourth step is still between banking institutions yet it's the credit card company and the customer's bank this time. Because the merchant bank gave the client's banking institution twenty cents, Mr. Robot's banking institution has to provide the credit card provider 10 cents. They have agreed so to begin with but we didn't know about it since we were way too rather busy shopping.
The fifth step is adjusting the rate and currency to the figures of the country you live in. In Germany, for instance, not many people and stores are familiar with processing credit cards. The handling fee may not at all be found in such scenario. Other elements likewise affect the processing cost but if I tried to explain and listed them all by using methodical terms, it won't rhyme any longer and translate well into a tune.
About the Author:
Al is an author and publisher for 'Card Compliance Services', a UK firm with more than fifty years of card processing expertise. It seeks to offer all businesses with an even amount of outstanding customer support. If ever your firm is new and you would want to accept payments online but don't have any kind of credit card processing terminal then you should take a look at Card Compliance Services.
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