Online Payments Make It Easy For Your Customers To Buy
Below is a MRR and PLR article in category Internet Business -> subcategory Ecommerce.
Online Payments: Simplifying Purchases for Your Customers
In our previous article, we explored how accepting credit cards can boost revenue and speed up cash flow for brick-and-mortar businesses. This week, we'll delve into setting up an online payment system for your business website. If you think implementing a credit card system in-store is challenging, just wait until you try discussing it with a bank for your website.
Most banks can offer you the merchant account necessary for online credit card payments, but their involvement usually stops there. Even bigger banks might have just one person knowledgeable about credit card processing, and if they’re unavailable, you’re left in the dark.
I’ve assisted numerous clients in establishing online credit card systems and often ended up educating the bank on online payment operations. To illustrate, I once heard a bank manager in charge of processing Internet merchant account applications ask, "When someone pays online, how do they swipe the credit card in their computer?"
Essentials for Accepting Credit Cards Online
Here’s what you need to accept credit cards on your website:
1. Electronic Shopping Cart System
2. Payment Gateway Service
3. Credit Card Processor
4. Internet Merchant Account from a bank or financial institution
How Online Credit Card Processing Works
1. A customer enters their credit card information at checkout.
2. The shopping cart software sends the transaction to the gateway.
3. The gateway forwards this to the processor.
4. The processor contacts the bank that issued the card.
5. The bank either approves or declines the transaction.
6. The processor communicates the result back to the gateway, which informs the shopping cart system.
The entire process, done electronically, takes mere seconds.
Components of Online Payment Systems
Payment Gateway Service
Once a customer submits their credit card information, the payment gateway acts as the intermediary. It submits the card details to the processor for approval.
Credit Card Processor
The processor, an electronic data center, verifies the transaction’s validity and settles the funds into your merchant account.
Internet Merchant Account
This account is where funds from online sales are deposited. Banks associated with Visa and MasterCard typically issue these accounts. However, many banks consider online merchants "high-risk" and may not offer accounts readily. This decision often hinges on financial risk assessment by the bank.
Thankfully, the growth in online sales has spurred a range of merchant service bureaus willing to provide the necessary accounts and tools, though fees might be higher.
Shopping Cart System
An online shopping cart system allows customers to select and purchase products on your website. It usually consists of:
- Product Catalog: Displays available items.
- Shopping Cart: Lets customers add items for purchase.
- Checkout/Payment System: Finalizes the sale and communicates with the gateway.
Shopping cart software can range from free to expensive, based on complexity and features. Selecting the right system involves considering the product type, product line, customer options, inventory control, and desired level of automation.
Numerous companies can assist with setting up your shopping cart and payment systems, charging from hundreds to thousands of dollars. Choose a well-referenced company to ensure quality service. The investment will pay off through increased sales.
Security and Privacy Concerns
Online payment security is paramount. While online credit card processing has existed for years, some customers remain wary of sharing their card information online. Ironically, these are often the same individuals who freely provide their credit details over the phone or in restaurants.
Rest assured, online transactions are generally more secure and less prone to fraud than these offline scenarios.
By setting up a robust and secure online payment system, you’ll enhance customer experience and drive sales, ensuring your business stays competitive in the digital age.
You can find the original non-AI version of this article here: Online Payments Make It Easy For Your Customers To Buy.
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