What is a credit card payment? / Credit card payment
In cashless payment transactions, credit card payment is widespread and popular with customers in online and offline retail, in addition to payment by EC or giro card. If a customer / buyer wants to pay by credit card, he must request it from a card-issuing bank (card issuer). On the other hand, the online store / seller must have a contract with a so-called acquirer (or acquirer bank) to accept credit card payments.
The most widely accepted credit cards worldwide are Visa and Mastercard. Also widely accepted are American Express, Diners Club and JCB. Credit card payments are usually made in retail stores using a card reader and the cardholder’s signature or PIN. Since this payment process cannot be mapped in Internet commerce, a different payment process is used here. The customer usually enters the cardholder’s name, card number, expiration date, and a three-digit card verification number, known as the CVC2 or CVV2 code.
Some online merchants rely on the 3D Secure procedure, which minimizes the risk of credit card misuse by means of additional security queries. Depending on the credit card, a distinction is made between the Mastercard SecureCode or Verified by Visa procedures. On the one hand, the 3D Secure procedure offers more security for merchants and buyers, but on the other hand it requires a registration effort and an additional step in the payment process for the store customer.
In the online store or e-commerce, the store operator can use a payment service provider for the acceptance of credit card payments. This offers the advantage of simplified PCI DSS certification and technical connection to the acquirer. A classic credit card payment is usually processed as shown below:
- The end customer enters the credit card data into the payment form in the online store.
- The payment data is forwarded to the PSP directly (via an iFrame solution) or indirectly via the merchant.
- The PSP transmits the data via a secure connection to the acquirer or the merchant’s credit card processing bank.
- The acquirer settles the transaction with the end customer’s issuer and credits the transaction to the merchant’s bank.
All processing of credit card data is subject to strict security requirements, which have been defined by the credit card industry and are known by the abbreviation PCI DSS (Payment Card Industry Data Security Standard).
