It seems practically magical when a simple, plastic card is swiped and instantly approved for a sale. Your POS system may have an integrated card swipe module or an external device for customer convenience, but both devices process credit cards in the same manner. With data flowing at incredibly fast rates, your POS system and credit card module work harmoniously to keep sales flowing smoothly.
You just swiped a card for a potential sale. What exactly happens to the credit card data? It initially travels to your merchant bank where your business identity is verified. In an instant, it matches your business with the sale amount, along with the particular card issuer. The data exits the bank, or acquirer, account and travels to the card issuer.
Customer’s Card Issuer
The card issuer receives the acquirer information. Before any transaction occurs, the information is rapidly matched to user history for fraud verification. If a cardholder typically shops in Los Angeles, California, for example, a transaction request from Santiago, Chile is highly suspicious. If card fraud is suspected, the transaction is declined at this point. A seemingly normal transaction passes this stage quickly as the cardholder is identified. The information is matched with the issuer’s specific bank, and moves onto the next transaction stage.
Card Issuer Bank
Your identity, account and transaction amount enters the card issuer bank. If funds are available, they are earmarked for this sale with the merchant’s information. An approval code bounces back to the merchant from the issuer bank as the transaction finally closes.
If a transaction reaches the issuer bank, but there is not enough funds, a card shows declined on the POS system. This situation is frustrating for both the customer and merchant. The customer is often full of questions that you cannot answer. Declined cards have no explanation for the merchant. The customer must contact their credit card company to resolve the issue.
Technology In A Flash
Although this process seems drawn out, it actually takes about 5 seconds to complete. Busy shopping periods, such as the day before Christmas, may take longer because of the high data flow, but credit card purchases through a POS system are safe, secure and rapid for quality customer service.
Combining POS systems with credit card modules keeps many businesses striving for high profits. Without a quality transaction system, checkout lines are slow and frustrating for everyone. Keep your system working smoothly with consistently maintenance. A simple wipe down of the surfaces is often sufficient enough to keep the system working well until you can thoroughly clean it.