Scribd
Upload
28 views

Card Woking

Uploaded by

ravindra2467
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as RTF, PDF, TXT or read online on Scribd
28 views

Card Woking

Uploaded by

ravindra2467
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as RTF, PDF, TXT or read online on Scribd
You are on page 1/ 2

In real-time, credit card transactions involve several steps to ensure smooth and secure processing.

Here's a breakdown of how credit card transactions work in real-time:

1. **Card Presentation**: When a cardholder makes a purchase at a merchant's point of sale (POS)
terminal or online, they present their credit card for payment.

2. **Authorization Request**: The merchant's POS terminal or online payment gateway sends an
authorization request to the acquiring bank or payment processor. This request includes details such as
the card number, transaction amount, merchant information, and possibly additional security
information like CVV (Card Verification Value) or address verification.

3. **Routing to Card Network**: The acquiring bank or payment processor forwards the authorization
request to the appropriate card network (e.g., Visa, Mastercard, American Express) based on the card's
brand.

4. **Issuer Verification**: The card network routes the authorization request to the card issuer (the
bank that issued the credit card to the cardholder). The issuer performs several checks, including
verifying the card's validity, checking the available credit limit, and assessing the transaction for potential
fraud.

5. **Authorization Response**: Upon evaluating the transaction, the issuer sends an authorization
response back through the same channels. This response indicates whether the transaction is approved,
declined, or requires further action (such as contacting the issuer for manual authorization).

6. **Transaction Approval**: If the transaction is approved, the authorization response includes an


authorization code. This code authorizes the merchant to proceed with the transaction and complete the
sale.

7. **Completion of Sale**: The merchant's POS terminal or online payment gateway receives the
authorization code and completes the transaction. In a physical store, this often involves printing a
receipt for the cardholder to sign. For online transactions, the process may include displaying a
confirmation message to the cardholder.
8. **Transaction Settlement**: At the end of the day or another specified settlement period, the
merchant submits a batch of authorized transactions to the acquiring bank or payment processor for
settlement. The acquiring bank initiates the transfer of funds from the issuer to the merchant's account,
completing the transaction.

9. **Cardholder Statement**: The credit card issuer compiles all authorized transactions into a monthly
statement for the cardholder. The statement includes details of purchases, payments, fees, interest
charges (if applicable), and other relevant information. Cardholders receive the statement either
electronically or by mail.

10. **Payment by Cardholder**: The cardholder reviews the statement and makes payments to the
issuer, typically by the due date to avoid interest charges. Payments can be made through various
channels, including online banking, mail, phone, or in-person at bank branches.

Throughout this process, various security measures, such as encryption, tokenization, EMV chip
technology, and fraud detection algorithms, are employed to protect cardholder data and prevent
unauthorized transactions.

You might also like