eCommerce Solution

E-commerce Payment Process

Online Transaction

Pay securely for those purchases or services online and off-line electronically. There is no better alternative to “e-commerce payment”. Ask yourself!
Why must you have to carry huge money around, when you’ve your credit/debit card or your mobile phone on you that can serve as wallet?
Your ATM card, Visa card, MasterCard or your mobile phone is all you need as your cash wallet any day, anywhere, at anytime of the day, to settle your purchases or pay for service bills.

But as easy as it sound, e-commerce payment process have systemic procedure outlined for merchants or their representatives to follow in arriving at whether to approve a transaction or not. It’s one of the most challenging aspect of e-commerce solutions. Unscrupulous elements across the world, have continue to devise means to impersonate people to commit fraud online. “Phishing”, “Skimming” and “Shoulder surfing” are some of the antics of these criminals in getting at their victims. It was also established by security operatives that, fraudsters collaborate with inside source in e-payment system to compromise customers information to commit internet fraud. Personal identity and card data of victims are the targeted information by fraudsters.

Some countries protect their citizen and residents of their countries by law to guaranty safety of their bank accounts. For instance, country like US, provide consumers right law, for residents to context questionable bill deductions from their accounts. For instance, if in a card dispute, a card holder contested strange charges on his or her account within stipulated time frame by law and win, the merchant concern will bear the brunt.

The rules regulating electronic payment, put onus of prove of transactions that warrant charges on cardholders accounts. Where he fails to prove the transaction, his business suffer what’s call Charge-back penalty.
To protect merchants against electronic payment crime activities, Payment Card Issuers (PCI), adopted standard procedure for e-commerce payment process. The procedure for payment, using credit or debit card follows a routing circle. I’ll use Visa card payment process as illustration:

Card Verification
Swiping or inserting payment cards through, Point of Sales (PoS) machine and entry of item’s cost by merchant at store outlet and send the detail electronically to the merchant bank for sales authorization. Where payment is done online,  card holder is required to fill payment form, that include; personal information, card data and payment option on the merchant’s web site check-out page. The required field includes; card holder’s name, home address, billing/shipping address, e-mail address, card number, expiration date, and CVV2. Contact phone number may also be required. The data form is send after filling by clicking the appropriate submission command button. The merchant, on receiving the form at his end, proceed to send the receive data, electronically, to the merchant’s bank for processing.

The Merchant’s bank in turn, send the authorization request electronically through an intermediary (VisaNet), to the card issuer for confirmation. VisaNet, a subsidiary of Visa Inc., function as clearing-h

ouse, perform: authorization, clearing and settlement services in e-payment transactions between e-commerce merchants and cardholders.
The card issuer reply back its response to the authorization request to VisaNet. VisaNet returns the response back to the merchant bank. And finally, the merchant bank send the authorization response back to the merchant for appropriate action.

These are some of the stages that every e-commerce payment process pass through to validate a transaction. Personal information and card data transmitted are reconciled with existing card holder’s data in database of card issuer server. If all the information supply by card-holder tally with that in the database, the card issuer returns a valid confirmation for the merchant to accept the transaction. If on the other hand, the data submit or part of it, is inconsistent with that in the data bank, the issuer bank returns an invalid confirmation. Which means the transaction should be decline for possible case of fraud and to avoid charge back penalty.

Geographical Location
Geographical location of online customers is important to e-commerce merchants. To protect business fraud, merchants monitor the destination of customers in Card not Present transactions. GeoLocator is software brands, install on e-commerce merchant web site interface, to highlight countries and states where online customers are transacting from. Geolocator software track the Internet Protocol (IP) address of Internet Service Provider use by online customer to connect merchant website. IP address are coordinat

ed numbers traceable to Internet Service Providers , who in turn, assign the IPs to internet subscribers as they connect to internet for browsing. When server IP is identify, the operation base of ISP shows on merchant’s web screen which translate to the location of online customer. As one arrive at a web site equipped with GeoLocator software, the site will indicate the country and state of the visitor.

Phone Number
E-commerce merchant request for phone number of their customers purposely to verify if it tally with the address submitted as residence by online customers. Usually, fixed phone lines are preferred over mobile line. Reason? Fixed  land line are commonly used at home or office with unique code definition for each state as against GSM line with borderless limit. GSM line can be use any part of a country without restriction. This makes it prone to being abuse for fraudulent use.

Swiping card through Point of Sales machine

Correlation of all the information highlighted above i.e, card verification, geographical location and phone line destination of online customers help merchants determine the genuine status or otherwise of online customers. An inconsistent phone number with the IP address of customer’s ISP is an indication of potential fraud at play. For instance, an online customer using Nigeria base ISP but submit an US phone line and US address as his residence/billing address, will certainly raise suspicion to any merchant. The result? Declined transaction.


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