Credit Card Processing is a complex process that looks extremely easy when performed before our naked eyes. Let us explore the entire process of credit card processing in a nutshell.

1. The cardholder presents their card (tap, insert, swipe, or other secure method such as contactless or simply by entering the card number for payment online via the card) to a merchant in exchange for goods and/or services. The request may originate from a point-of-sale system or a credit card terminal in a brick-and-mortar store, through mobile or in-app payment acceptance, or an eCommerce website gateway.
2. The second step involves the merchant sending a payment authorization request to their payment processor.
3. Thereafter, the payment transaction gets submitted by the payment processor to the appropriate card association and it then reaches the issuing bank.
4. The issuing bank receives authorization requests, including parameters such as Address Verification System (AVS), Card Verification Value (CVV), expiration date, and validation. After this, the transaction gets approved or declined.
5. The last step involves the issuing bank sending the approval (or denial, as the case may be) to the card association, merchant bank, and then to the merchant.

The best thing is that the entire card authorization process by top credit card processors takes only a few seconds. What seems otherwise a lengthy and complicated process actually happens like a breeze.

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