Online credit card payment is something which we are increasingly getting used to in our busy life style. Whether it is the favorite movie DVD that we should buy or the greeting card and a bouquet of flowers that we should surprise someone special with, anything is achievable through the method of online credit card payments. Hence, the necessity of the hour is to be aware of how this payment processing really works for a better knowledge and also for safety concerns. Simply speaking, the mechanism or the entire process that is involved from clicking that “Buy” button online button and getting the thing “delivered” at your doorstep.
Online payment processing can be studied under two heads. They are authorization and settlement. The prospective buyer first visits the internet site of owner and checks out what all products are in offer along with their prices. Once he decides to get the item of his choice, all he needs to accomplish is go through the “Buy” button.
When the client does that, an authorization request is automatically delivered to the payment processor for payment processing, which again forwards it to the issuing bank or the lender associated to the credit card. In this request, all the important points regarding the bank card are sent. These details include – the credit card number, expiry date of the credit card, the billing address (for Address Verification Service), the CVV number (or the Card Verification Value, a three digit code printed in the signature panel at the rear of the credit card) and the total price of all the products or services that the customer has chosen to buy.
The issuing bank or the financial institution associated to the card then instantly cross-checks the info it has just received through the payment processing procedure. It validates the card number and expiration, checks the amount of the order against the available credit, check the billing address provided contrary to the billing address on file and validates the Card Verification Value number (if it is provided).
If the above mentioned set of information is validated and approved by the issuing bank, it sends the authorization a reaction to the payment processor. This authorization response in payment processing includes Buy Cvv an approval to the transaction between the customer and the vendor combined with address verification and the Card Verification Value response codes or a decline or disapproval to the whole transaction.
The payment processor, which plays the mediator role throughout the online processing in the event of debit or credit card payments, then adds some codes to the authorization response and passes it onto the seller’s website – the internet site where the client placed his order.
Therefore, based upon the state of authorization, the buyer or the card-holder receives the denial or a confirmation of the order. If declined, the client is informed along with a message which asks him to try a different mode of payment. Unlike this, when the authorization is approved the issuing bank, the client is taken up to the order confirmation page.