Online payment technology is a next generation technology in this you need not to carry much cash in your wallet. There is some plastic card or it may be your Smartphone. A detailed knowledge of this technology make you more comfortable with this technology what they are, how it will work and what pros and cons of this technology.
But before know this advanced payment method let’s take a look to our oldest payment system that was traditional credit cards. This will help you more understand the process involve in this system.
The credit card payment system:
In 1966 first MasterCard issued in USA. This plastic card with magnetic stripe which hold the information about the credit card holder and give this information to the financial institution. User uses this card for payment for product and services.
How credit card work?
- Consumer swipe credit card over merchant point- of- sale terminal
- PoS terminal read magnetic strip on card and send information to merchant PoS
- PoS contact with PSP then PSP contact acquirer then acquirer contact with issuer
- Then issuer return authority to acquirer and acquirer pass info to POS then they complete the transaction.
Next- gen payment method: payment gateway for online technical support
EMV credit card: it’s a chip and PIN card. These cards store the payment information than a magnetic stripe. Because they are encrypted. Its PIN increases the authority of card. 14./ These PIN numbers you press before payment proceed.
RFID credit cards: it uses passive radio frequency identification in this just wave card in front of RF terminal and transaction completes. It is also called contactless credit cards. These cards are MasterCard; Pay Pass and Visa Pay wave uses RFID.
In this card no physical contact between card and terminal. Its radio frequency identification which allow customer wave the RFID card. RFID chip placed in card its releases the radio frequency energy which transferred to the payment terminal. And no need of any signature and PIN entry. It’s limited by bank to decide maximum transaction limit per transaction. It may be $50
Payment Gateway: security of these cards can be handled by payment gateway. A merchant and bank depend on payment for security of your cards. The payment gateway work when customer attempt to purchase from website and uses credit card and debit card. Its complete its process in three steps
1st authorization: payment gateway for online technical support should be authorised by card issuer then it will check Is credit card acceptable. It creates a secure link between customer and credit card processor. Allow a fast and secure transaction.
2nd settling: its groups all your transactions send this transaction to bank in single batch. Sometime it may be settle in same time and every day. It normally takes two business days to settle transaction deposit in your bank account.
3rd reporting: in this process record your transaction and allow using these facilities. Through this you can review your transactions and download and use them for future.