CREDIT CARD PAYMENT PROCESSING CONCEPTS

Payment Processing: Defined

On-Line Payment Processing

Coordinating the flow of secured transactions among a complex network of processors and financial institutions

eCommerce

The buying and selling of products and services by businesses and consumers over the internet

Payment Processing: Components

Cardholder / Customer Processor Cardholder Issuing Bank

Payment Gateway

Settlement

Acquiring Bank

Credit Card Associations Merchant

Merchant Bank

Payment Processing: Phases

Authorization
Verifies that the card is active Verifies Cardholder has sufficient credit Cardholders Open-To-Buy is reduced

Settlement (Batch Deposit)

Capture Cardholder account is charged $$ deposited to Merchant Bank Acct

Putting it all together: Authorization

Merchant
Cardholder / Customer
Payment Gateway

Processor

Merchant
Payment Gateway Processor

Cardholder Issuing Bank

Putting it all together: Settlement

Merchant Bank
Acquiring Bank

Merchant

Payment Gateway

Processor

Cardholder Issuing Bank

Cardholder / Customer

Payment Processing: Summary

Coordinating

the flow of secured transactions among a complex network of processors and financial institutions

Infrastructure: Components
IBM WebSphere Payment Manager

Wintel Servers IBM HTTP Server (Apache) IBM WebSphere Application Server IBM DB2 Database JAVA Programming Environment

Infrastructure:
Internet (https)
eCommerce Web App

Components

Web Server
Wintel Servers Java/ J2EE

App Server
Payment Gateway

Database

Payment Mgr