What does the card transaction process entail?
There are a number of steps involved in processing a card payment:
- When the payment details have been entered into a terminal and if it is a face-to-face transaction, in a majority of cases, it is authorised by the customer entering their PIN. Where it is an online, phone, mail order or fax transaction it is processed as a card-not-present transaction.
- The details and amount are passed to the acquiring bank that processes the card’s transaction details through to the cardholder’s bank or card issuer, via the card scheme.
- When the cardholder’s bank or card issuer receives the details, it will carry out a number of checks – such as making sure that the card hasn’t been reported lost or stolen, and that there are sufficient funds in the account – before debiting the amount of the purchase from the cardholder’s account.
The money for the purchase will be placed in a merchant’s bank account by their acquiring bank who will advise how long this will take.
