Q: What is a Merchant Account?

A: A financial institution or bank account that is used by a merchant specifically for the purpose of collecting proceeds from a consumer bank account or credit card payment transactions. A Card Present (CP) merchant account is used by merchants that receive payments in a physical location where payment is physically presented to the merchant by the customer at the time of the transaction. A Card Not Present (CNP) merchant account is used by merchants that receive payments electronically or in situations where payment is not physically presented to the merchant by the consumer at the time of the transaction.

Q: What is a Merchant Account Provider?

A: A financial institution, or bank, that provides a financial account to a merchant for the purpose of collecting proceeds from a consumer bank account or credit card payment transactions.

Q: What is a Payment Gateway?

A: A system of technologies and processes that allow merchants to electronically submit payment transactions to the payment processing networks (i.e., the Credit Card Interchange and the ACH Network). Payment gateways also provide merchants with transaction management, reporting, and billing services.

How It Works

Customer purchases product via Merchant's store or web site; Electronic payment is captured and processed through merchant's Payment Gateway Service Provider (i.e. Authorize.Net, BluePay, iDepost, TrustCommerce); Merchant Bank's Processor receives transaction data from Payment Gateway Service Provider and sends to Credit Card Interchange; Credit Card Issuer receives data from Credit Card Interchange for account validation; Credit Card Issuer returns account validation or denial back through Credit Card Interchange; Merchant Bank's Processor receives transaction validation or denial from Credit Card Issuer via Credit Card Interchange; Merchant Bank's Processor sends transaction validation or denial onto Payment Gateway Service Provider; Payment Gateway Service Providerreturns transaction processing confirmation or denial to Merchant; Successful transactions proceed to Merchant's Bank and Merchant's Bank Account for payment.

Magnum Data is a certified reseller of Authorize.Net Merchant Account and Payment Gateway Solutions. For pricing info and an online application Click here.

Content above provided by courtesy of Authorize.Net.

Contact sales@magnumdata.net with your Payment Gateway or Merchant Account questions.