How To Accept Credit Card Payments Online?

The e-commerce industry has steadily taken over traditional retail sales. The after-effects of the Covid-19 pandemic have caused a broader customer base to resort to online purchases. According to research, 78% of Indian consumers perceive online shopping to be as safe and transparent as the offline mode, with over 80% claiming that product purchases from e-commerce platforms meet their expectations. Additionally, using a credit card online has gained immense popularity amongst shoppers. Credit cards have gradually taken over as one of the widely used options for making online payments. Transacting with a credit card offers a variety of benefits for customers, such as the facility to pay later, break substantial payments into EMIs, and receive multiple offers & rewards on their purchases. 

With a rise in online shopping, more businesses are evolving to present a diverse range of products in the online marketplace, leading to rising economic growth. The most critical aspect while establishing a business is setting up a secure payment system. This article elaborates on how businesses can accept credit card payments online. 

Accepting Credit Card Payments – A Complete Guide

Here is a complete guide depicting how businesses can accept credit card payments. 

Setting up a merchant account

A merchant account is a business account in which a customer’s money gets deposited after using debit or credit cards. The money gets transferred into the business bank account upon successful verification of these payments. 

In credit card processing, as a customer makes a payment, the transaction typically involves two major parties: 

(i) the issuing bank, which has granted the credit card to the customer and is responsible for collecting payments.

(ii) acquiring bank, which requests and collects payment from the issuing bank and releases them to the merchant. 

This is how a typical credit card transaction occurs to transfer money from credit card to bank. This acquires bank asks for the funds from the issuing bank, which verifies if the customer has sufficient funds, and then transfers them. The merchant account functions as a holding space during this process. 

Third-Party Processor

Setting up an account with a third-party processor could be simpler than a merchant account. This is because the third-party processors aggregate all the merchants into one huge account instead of giving each merchant their own account, leading to higher account stability. 

Using Payment Gateways

A payment gateway is an application designed to make the online payment process simple and hassle-free. The application acts as a medium to connect the merchant’s mobile application or website with the bank. As customers make payments through a payment gateway, the merchant’s website sends their credit/debit details to the gateway for verification. As the gateway confirms the customer’s details, the amount gets transferred from the customer’s account to the merchant’s bank account. 

Also Read: The Life Cycle Of An Online Card Payment

Accepting Payments on a Website 

A website is integral to most online businesses, but not all businesses need one. If the business has a website, it can implement payment buttons for the existing sites or use features such as an extension or a plugin to support payments made through credit cards. 

Hosted Payment Page for Websites

One of the simplest ways to accept credit card payments online is through hosted payment pages. This feature redirects customers to a secure checkout as they enter the payment details. Hosted payment pages can be easily integrated with the current website and typically require a few lines of preformatted code. The business eliminates the hassle of encrypting its servers by momentarily redirecting customers from the website. As a result, sensitive data is never stored on the company’s server, dramatically reducing the chances of a data breach.  

Invoicing Software

Businesses can use cloud-based invoicing software to accept credit card bill payments. They can customise invoices and share them via email or generate a shareable link for the invoice using the software. Customers can follow the given link to make credit card payments. 

Conclusion

Businesses seeking to evolve in the online marketplace can opt to accept online credit card payments. Building a secure payment portal generates more trust for buyers in the seller and attracts a more extensive customer base. New businesses can thoroughly research the available options for accepting credit card payments to implement the most suitable one for their trade.