Authorize.net is a payment gateway service provider allowing merchants to accept credit card and electronic payments through their website. To be able to accept payments online, there are a series of complicated process that merchants need to go through. The process can even be more complex if they want to accept different type of payment methods as this means they need to connect the website to each method one by one. In this case, a payment gateway like Authorize.net, helps make it easier to connect your website to the payment processing networks all in one.
As described by Authorize.net, their system simplifies this complex process of into a 2 to 3 seconds
The 7 steps involved in processing a transaction with Authorize.Net.
- Step 1: The customer submits his credit card for payment.
- Step 2: Authorize.Net manages the complex routing of the data on behalf of the merchant through the following steps/entities.
- Step 3: Authorize.Net passes the secure transaction information via a secure connection to the Processor. The Merchant Bankâ€™s Processor submits the transaction to the credit card network (like Visa or MasterCard). The credit card network routes the transaction to the bank that issued the credit card to the customer.
- Step 4: The issuing bank approves or declines the transaction based on the customerâ€™s available funds and passes the transaction results back to the credit card network. The credit card network relays the transaction results to the merchant bankâ€™s processor. The processor relays the transaction results to Authorize.Net.
- Step 5: Authorize.Net stores the transaction results and sends them to the website for the customer and merchant to see.
- Step 6: The merchant delivers goods or services to the buyer.
- Step 7: The issuing bank sends the appropriate funds for the transaction to the credit card network, which passes the funds to the merchant’s bank. The bank then deposits the funds into the merchant’s bank account. This is called “settlement”, and typically the transaction funds are deposited into the merchant’s primary bank account within two to four business days.