Online Card Transaction

An online card transaction is a secure authorization process relying on Point-of-Sale approval devices and real-time EFT technologies. The technology involves interchange fees.

Payments via POS terminals are common for department stores, cafes, drug stores, etc. POS terminals use the Internet connection to process customers’ payments. POS device reads the customers’ payment card data, and after getting approval from the bank, transfers the funds from the customer’s account to the seller’s one. All of these actions happens online.

During the Electronic Funds Transfer (EFT), an electronic money transfer takes place. The funds from one bank account go to another one. And the accounts may be within one financial institution or several ones. This option refers to the online card transaction because the fund transfer happens via computer-empowered technologies. Clients do not interact with the bank staff.

There are a couple of stages the online card transaction has:

  1. The customer enters the payment card data.
  2. The seller receives the data but the payment service provider will be the one to process the payment.
  3. After going through the payment gateway, the card data gets to the acquiring bank.
  4. The acquiring bank will approve or decline the transaction.
  5. If everything is fine, the acquiring bank passes the request to the issuing bank.
  6. Should the customer has enough funds, the issuing bank approves the request and sends it back to the acquiring bank.
  7. The acquiring bank returns the confirmation to the seller.