An Introduction To Batch Credit Card Processing
Whilst an online merchant’s top priority is to make the payment process more efficient and cost-effective, real-time, streamlined transaction processes are essential for customer satisfaction. Generally, the main components of a credit card transaction consist of: initially, the transaction is authorized, and then the funds are transferred to the merchant account at the acquiring bank.
However, although paying with a credit card is fast and convenient, processing real-time payments is tedious and costly. Therefore, batch credit card processing provides a good alternative.
What is Batch Credit Card Processing?
The batch credit card information is temporarily saved in the credit card machine when the individual presents the batch credit card to your business. If the transaction is “pending” on the customer’s end, the money will not yet be transferred into the account. Further, batch processing involves processing multiple batch credit card transactions simultaneously.
To that end, batch credit card processing involves the following steps:
- An authorization step is where the merchant confirms that a customer has made a purchase with a credit card.
- Authorization occurs when the customer’s credit card information and transaction amount are sent to the issuer to validate that the card was legitimate, that enough credit was available to complete the transaction, and the card had not been flagged as stolen.
- Following the close of business, merchants transmit to their banking institution the day’s credit card transactions.
Here’s why you should consider batch credit card processing:
With batch processing, there is only one settlement per day, unless the merchant has other requirements. It provides the following benefits:
- Automated process: By doing this, your employees can focus on executing your business plan instead of taking payments.
- Instantly review transactions: All transactions from a specific batch can be viewed with ease.
- Streamlined processing recurring transactions: As frequently as you bill clients, recurring payments are a great time-saver.
- Decreased security risk: Rather than processing multiple times a day, processing once a day minimizes your contact with your processor and keeps your customers’ payment data more secure.
- Reduces transaction fees incurred when processing: When you do business in bulk, you save on fees as banks charge each time a merchant makes a transaction. For merchants who have a high volume of payment transactions throughout the day, this is a powerful tool. As well, it’s important to acknowledge that, from the customer’s perspective, bulk card processing doesn’t differ from a regular transaction.
With batch credit card processing, it appears to be a sophisticated process, but the flexibility it allows your business to accept credit cards is straightforward and practical. In addition to increased sales, batch credit card merchants stand to reap the benefits from efficient payments, sophisticated security technologies, and plenty of other valuable features.