It doesn’t mean much… and surely does not imply that your credit card will be immediately processed. Real time credit card processing is used when a site is automatically connected to a payment gateway.
Aren’t all websites connected? No. Many websites lack the technology needed for such integration. Some lack a payment page altogether and use mail, phone or fax orders to close the transaction. Others collect the info on their “Payment Page”, yet if such is not automatically connected to a payment gateway the end result is the same – manual submission of these transactions to a payment gateway through a virtual terminal.
And those that are automatically connected – do they process credit card transactions on-line in real-time? Some do and some don’t yet the more sophisticated ones usually wouldn’t. What they do is perform an on-line real-time authorization check with the issuing bank. Should such fail they return in real-time to the buyer and suggest rechecking the billing address or the use of another card.
Why don’t they immediately process the card? For numerous reasons: to begin with, according to Visa and MasterCard regulations, when physical goods are purchased, they are not entitled to charge a credit card until items are actually shipped to the buyer. Some still do… yet the more respectable sites would follow the instructions and charge the card only upon shipping, using the shipping event as a trigger, sending a notification to the shopper that his card was charged, stating all order information including shipping tracking code.
Even if digital goods are purchased, in today’s world, due to the nasty implications of chargebacks, the real-time authorization check is usually not enough and most merchants (either in-house or outsource) use other fraud checks prior to actually charging a card.
A transaction may pass through on flying colors and should it reflect a digital purchase can be processed in real time, yet in many cases, it is not a clear cut and requires a human eye and a decision maker to clear a transaction for processing. This is why, usually when purchasing on-line you receive (on the “thank you page”) a notification stating that your transaction is “in process”. It does not mean that you’ve purchased the item nor that your card’s been charged – item may not be on stock or you might still fail their fraud checks.
Gidi Argov, Founder and CEO
www.CreditCardProcessing-r-us.com
