The e-commerce ecosystem is a vast, interconnected network, where businesses and people play a variety of different roles. Online transactions can involve half a dozen different parties. The fact that the vast majority of customers remain oblivious to the number of different players involved in each online transactions is a testament to how smoothly the entire operation runs.
The payment processor plays one of the most important roles in e-commerce. It may be fulfilled by a bank, online platform or other type of merchant services provider. Payment processors enable merchants to accept credit card payments. So, how do merchants go about choosing the right payment processor for their business?
In both card-present and card-absent environments, making card payments has become a swift and seamless process. The customer provides their card information, the transaction is authorised and the payment is complete. This all transpires in a matter of seconds, in spite of the fact that, behind the scenes, quite a lot of communication is actually happening to ensure that everything is carried out as it should be.
Every credit card transaction involves several entities, with the payment processor doing the vast majority of the heavy lifting. In order to generate revenue, payment processors charge a fee for transaction activity. This includes positive transactions, e.g. purchases, as well as negative ones like chargebacks.
Payment processors act as an intermediary between the customer’s bank and the merchant. When the customer makes a purchase using their card, the merchant sends the transaction details to the payment processor, which the payment processor relays to the issuing bank.
If the card issuer cannot authorise a transaction based on the data provided (for example, if the account has insufficient funds to complete the transaction) the payment processor communicates this to the merchant. Otherwise, the transaction will be completed.
A payment processor is an intermediary between the merchant and the customer’s bank. An acquirer, on the other hand, is an institution that provides the merchant with an account in order to receive payments. Through card acquiring, the merchant’s bank or payment processor aggregates and separates payments via the respective Card Scheme networks, like Mastercard and Visa. Card acquiring facilitates instant, seemingly simple transactions, but behind the scenes, it is a complex process that results in consumer card payments either being authorised or declined.
For most merchants, the prospect of managing multiple relationships with acquiring banks would be too time-consuming and complex. Card acquiring eliminates the need for this, providing a single solution for local card acquiring across international markets.
Edgars Lasmanis, Walletto founder, has extensive experience of the digital payment ecosystem. Walletto is a world-class payment processing platform that takes an individual approach to e-commerce.
For business owners, Walletto offers a variety of different services, enabling them to receive and pay money anywhere, anytime.
Walletto provides its customers with:
- Payment cards, virtual prepaid and reloadable plastic cards, providing a convenient and more secure way to make online payments that is accepted worldwide.
- A security-first approach, where clients can freeze their card to prevent unauthorised transactions in the event that they misplace their card. In addition, Walletto implements 3D Secure, adding an additional layer of security when customers make payments online.
With commissions starting at 1%, Walletto provides its customers with 24/7 support via its team of friendly, efficient professionals. Prioritising system security, Walletto has PCI DSS certification, ensuring that its customers’ debit and credit card transactions are secure. The company is constantly updating its security measures and uses the latest tech to protect customer information and reduce fraudulent transactions.