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4. Payment Gateway
The payment gateway processes the buyer's credit details to verify whether the transaction is valid and authorized. This is done by checking the buyer's credit card account and performing several operations:
- Check if there is sufficient funds to cover the transaction.
- If the credit card is still valid and verify the information is correct.
If the transaction is approved, the funds will be transferred to the business's merchant account.
5. Merchant Account
The merchant account holds all the funds from the payment gateway processing. The reason for merchant accounts is that banks and other financial institutions lack the facilities to assist businesses to accept payments online. Only in recent years, have banks begun offering features to compete with merchants to process payments online.
Final Words
Although this article covers just the core elements of an E-Commerce strategy for small businesses, businesses should remember conducting transaction online is just another approach to selling/buying services and/or goods. Therefore, the fundamentals of running a business is no different, such as, in areas of support, service level and etc. If you are a 'brick-and-mortar' business, then learn to convert your strategies to online means. You may be surprised at the results, and as they say, business is business!
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