Credit Processing

When a vendor wishes to sell their goods or services online via the internet, they will typically use what is called a payment gateway. A payment gateway provider is generally a fourth party to the transaction (after the vendor, the customer and the merchant bank) and it is probably easiest to view their role as that of replacing the electronic point-of-sale (POS) termination commonly used for transactions that occur in stores.

The gateway allows the vendor to receive, and also have processed, credit card payments over the internet. The vendor is able to either:

• take their customers credit card details via some sort of online order form, over the phone, or by email and then enter the details in to the payment gateway themselves (commonly known as a virtual terminal); or
• the gateway may be integrated in to the order process and shopping cart on the vendor’s website itself, in which case no manual entry should be required (which is generally done by an API and will enable real-time processing of the transaction).