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Payment Gateways
A payment gateway helps merchant websites (online store websites) to place a credit card/check transaction with the customer’s credit card issuing bank.
Merchants websites do not have the intelligence nor the authority to talk to the vast financial network in order to validate credit card
transactions. The payment gateway knows how and who to "talk to" to get that answer. It is a network service that seats in between the
merchant websites and the financial network.
To process online payments, you also need a Merchant account. It is a virtual bank account that is associated to your real business checking account. It does
not hold the money but only provides an interface to helps you receive electronic payments. This Merchant account is mandatory because banks do not talk
to the credit card network or payment gateways. That is the job of the Merchant account processor.
Payment gateways offer a list of merchant account provider to chose from. The same with merchant account providers who have their suggestions of
payment gateways. So there is usually no need to deal with two different companies since one will sign you in with the other.
With myEbiz, lots of choice since it is fully Integrated with 130+ payments gateways, click here for a list of supported payment gateways. See also the ones
that myEcommerce.biz recommends as reliable and cost-effective.
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Better than words: step by step transaction diagram process
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Step1: The merchant's website sends a CC transaction to "Payment Gateway" via a secure site connection.
Step2: The "Payment
Gateway" receives the credit card transaction request and submits it using a secure site connection to the "Merchant Bank’s Processor".
Step3
: The "Merchant Bank’s Processor" sends the complete transaction request to the "CC Network" (financial system network that is used to
process CC transactions).
Step4: The "CC Network" forwards the complete transaction to the "Customer’s CC Issuing Bank".
Step5: The "Customer’s CC Issuing Bank" accepts or refuses the transaction depending on the customer’s available funds and sends back the results to the
"CC Network".
Step6: Then the "CC Network" transmits the results to the "Merchant Bank’s Processor".
Step7
: The "Merchant Bank’s Processor" sends the results to the "Payment Gateway".
Step8: The "Payment Gateway" saves the
results of the transaction and then transmits those results to the merchant’s website who deliver them to the end customer.
This is the end of the approval process, which usually takes less than 3 seconds.
Step9
: If the The "Customer’s CC Issuing Bank" has approved the transaction, it will send the funds to the "CC Network".
Step10: The
"CC Network" sends the funds to the Merchant’s Bank. Within two to four business days the "Merchant’s Bank" will deposit the funds in the
Merchant's bank account. That is called the settlement process.
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