PROCESSING TUTORIAL - OVERVIEW
Making purchases over the Internet involves four main
parties: the consumer or credit card holder; the merchant who
is offering products or services for sale; the merchant bank
that has contracted with the merchant to enable the merchant
to accept credit cards over the Internet; and the company that
processes credit card payments for the merchant bank, known as
the acquiring processor. (The acquiring processor processes
merchants' credit card transactions through the financial
network on behalf of merchant banks.) One other party is
involved, the issuing bank that has issued the consumer's bank
The consumer interacts with the merchant's Web site by
using a Web browser such as Netscape Navigator. To make credit
card purchases, the consumer must obtain a bank card from an
issuing bank and, when making a purchase, provide bank card
information to the merchant's commerce application.
The merchant's commerce application makes goods and services
available for sale over the Internet by payment-enabling the
merchant's Web server application. To accept credit card payments
over the Internet, the merchant must have an account with
a merchant bank that offers Internet credit card processing.
The merchant bank may also function as the acquiring processor
to move the credit card transaction through the financial
networks; or it may designate another company to function
as acquiring processor on its behalf.
Steps In An Internet Credit Card
1. When the consumer decides to buy something, the merchant's
commerce application prompts the consumer for credit card
information, usually along with other information such as
a shipping address.
2. The consumer enters payment information either into
a form secured by the Secure Sockets Layer (SSL) protocol
or into an application, such as Netscape Navigator, that
is compliant with the Secure Electronic Transactions (SET)
specification. With the secured form, the payment information
is protected by SSL as it is sent to the merchant. With
SET, credit card information is enclosed in a "slip"
- an encrypted, electronic analogy to a paper credit card
slip. The slip is then sent to the merchant.
3. Using the payment software incorporated in the Web server,
the merchant sends the encrypted transaction to the acquiring
processor for authorization. The authorization is a request
to hold funds for purchase.
4. The acquiring processor either authorizes a certain
amount of money (and issues an authorization code) or declines
the transaction. An authorization reduces the available
credit limit but does not actually put a charge on the customer's
bill or move money to the merchant.
5. If the transaction is authorized, a "capture"
is the next step. The capture takes the information from
the successful authorization and charges the authorized
amount of money to the consumer's credit card. In line with
bank card (Visa/MasterCard) association rules, the merchant
is not allowed to capture transactions until the ordered
goods can be shipped, so there may be a time lag between
the authorization and the capture.
6. If the consumer cancels the order before it is captured,
a "void" is generated; if the consumer returns
goods after the transaction has been captured, a "credit"
7. The final step is to "settle" the transaction
between the merchant and the acquiring processor. Captures
and credits usually accumulate into a "batch"
and are settled as a group. When a batch is submitted, the
merchant's payment-enabled Web server connects with the
acquiring processor to finalize the transactions and transfer
monies to the merchant bank account.
Using the NETbilling gateway to process your transactions
provides you with security, convenience and control, as well
as many additional tools designed to aid in your success,
from numerous real time reporting features to variable fraud
The NETbilling administration area is extremely comprehensive
and useful tool. Our admin includes an abundance of features
which provides you with the most flexible and advanced processing
abilities on the internet, and also doubles as an excellent
customer management database.
here to preview a few of the exceptional features within
our system administration area, or click on the admin tuturial
link in the menu to the left. When you are ready, a friendly
NETbilling sales representative will gladly give you a personal
one on one walkthrough of our actual administration area.
Please contact us anytime for assistance.