|
A merchant
account is a
contract under which
an acquiring bank
extends a line of
credit to a
merchant, who wishes
to accept payment
card transactions of
a particular card
association brand.
Without such a
contract, one cannot
directly accept
payments by any of
the major credit
card brands. When
using an
intermediary payment
service provider
(such as PayPal),
the merchant account
is in fact held by
the service provider
itself. Methods
of processing credit
cards
Today a majority of
credit card
transactions are
sent electronically
to merchant
processing banks for
authorization,
capture and deposit.
Various methods
exist for presenting
a credit card sale
to "the system." In
all circumstances
either the entire
magnetic strip is
read by a swipe
through a credit
card terminal/reader
or the credit card
information is
manually entered
into a credit card
terminal, a computer
or website. The
earliest methods,
submitting credit
card slips to a
merchant processing
bank by US mail, or
by accessing an
Automated Response
Unit (ARU) by
telephone, are still
in use today but
have long been
overshadowed by
electronic devices.
These early methods
used two-part forms
and a manual device
for mechanically
imprinting the
embossed card number
information onto the
forms. Whenever
practical it is best
to swipe a credit
card because the
rates will be much
lower and the
incidence of stolen
credit card number
fraud is greatly
reduced.
Article Resource:
http://en.wikipedia.org/wiki/Merchant_account |
