The Functioning Of Credit Card Processing For Dispensaries

By Gary Reyna

A credit card is a payment that is issued to card holders to enable them to pay for goods and services based on their promise to the issuer. The cards basically pay for the goods or services bought by the holder plus additional charges as per the agreement with the issuer in most cases it is usually the bank where one hold an account in their name. Below is how Credit Card Processing For Dispensaries happens.

The bank on their part have to design some kind of a rotating account which will be used to award a line of credit to the holder. The holder is able to borrow money to pay for goods and services from a trader as cash advance through this line of credit. Payment of services through the month are combined by the card and the holder is required to pay at the end of every single month.

Credit cards are not just issued to anyone. There must be a willing client, a willing financial institution and a merchandising firm for an agreement to be reached. Legal terms refer to the client as the holder while the financial institution is known as the issuer. The business that accepts the cards is referred to as merchant. Financial institutions can be banks, companies and organizations.

A merchant is a crucial party in this process. The merchant is mostly a business that agrees to take payments by cards in trade for products and services. The procuring bank plays the role of a middleman who accepts payments for goods and services on behalf of the merchant. The credit card association has to be allied with the card.

A credit card association is basically a body that sets transaction terms for merchants, issuing bank and acquiring bank. They include discover, visa, MasterCard, American Express among others. A transaction network has to be put in place in order to implement the mechanics of electronic transactions. This may be operated by an independent company or one company operating from multiple networks

They can be used to secure both services and goods. Transport, salon, and health among others are examples of services that can be used these cards. Holders must also know how the process works right from the beginning to the end. Usually there are two crucial columns including late fees and minimum payments column. The billing process is a cycle involving calculation of all money spent which is then followed by sending it to the client.

Minimum payments are calculated and recorded on the billing statement. The holder has to reimburse this type of payment. The payment has to be done before the payment date is due, the date is mostly agreed on by the holder and the bank. Processing cards takes place in steps.

The first thing is that holders must present their cards at the point of purchase. At the merchandising point the cards are swiped in the payment system. The concerned financial institution captures details of the cards then forwards it to the used network for clearance of payments. Once payment request has been cleared then the financial institution authorizes issuance of good or services.

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