The onset and continuous development of diverse digital payment transaction technologies has enabled speedy and more reliable online funds transfers. 2017 has witnessed a superfluous in-surge of payment innovations owing to the globalization of markets via the internet. This post explores 5 of the most vital online payment terms you ought to be conversant with so as to excel in online entrepreneurship.
All businesses accepting credit and debit card payments are required by law to comply with the Payment Card Industry Data Security Standard (PCI-DSS) set by the PCI council. This requirement provides for card service providers to restrict usage of their payment cards in case businesses fail to comply with the set standard. Moreover, this measure secures online transactions by ensuring sensitive payment transaction data is transmitted via safe and recognized channels.
PCI-DSS integration in Indian payment gateways outlines a set of established requirements and objectives which businesses that store, transmit or process data regarding debit or credit card payments must adhere to so as to detect and steer off payment data breaches in India.
- Chargeback/ Reversal
Chargeback is a policy through which a disputed or unsuccessful payment transaction is reimbursed to the merchant or card holder. Usually, chargebacks are stimulated by the following reasons:
- The product received upon delivery is utterly different from what was advertised and ordered.
- Failure to receive the product as ordered
- Use of debit or credit card without the holder’s authorization.
Online businesses are always wary of chargebacks as processing a bulky sum can have adverse financial consequences. For instance, merchants can have their accounts terminated or be subject to heavy fines.
- 3-D Secure
3-D Secure, the easiest and most reliable way to secure your online payment transactions from chargebacks, is a security protocol designed to prevent web-based fraud via credit and debit card payments. As the actual cardholder, you are allowed to assign your card credential user name and password to safeguard it against unauthorized use.
Online payments using credit and debit cards processed though 3-D Secure possess a liability shift which enables you to veer off heavy chargeback payments. Through 3-D Secure, rupay payment gateway providers as well as debit and credit card institutions provide safer payment transactions across the globe.
- Acquiring and Issuing Banks
Any financial institution that processes debit and credit card payment transactions for your web-based enterprise is called an acquiring bank. It verifies transactions initiated by customers and accepts debit and credit card payments from the banks that issue the cards. The acquiring bank can also decline to approve the transaction if the card details are questionable.
The financial body that provides credit and debit cards from the card issuing associations expressly to customers is termed an issuing bank.
- Merchant account
In order to excel as a merchant, you need a bank account where individual clients and companies will process credit and debit card payments transactions. This merchant account will be the link between you and your payments collection bank.
Whenever a web-based payment is initiated and successfully completed, the acquiring bank collects payment from the customer, deducts the operation fees then deposits the subsequent sum in the merchant account for later payment to the merchant’s personal bank account.
Although the terms discussed above are among the latest additions in the online payment infrastructure, the dynamism associated with online markets continues to call for more versatile, convenient and safer online payment modes to befit and support today’s mobile lifestyles. We are thus set to see more web-based payment innovations.