Why Businesses Need Secure Payment Services
Table of contents
Cash as a payment method has been slowly declining in Australia since 2007, Then the 2020 COVID-19 pandemic hit and the need for contactless payment was the final nail in the coffin for cash. Australian consumers fell in love with the speed, convenience, and reliability that online payment methods can offer. And though the pandemic has passed, they have maintained their preference for contactless payment methods such as card payments, direct debit, and digital wallets. But as the popularity of online payment methods and digital wallets grow, so does the need for businesses to have secure payment services in place to protect themselves and their customers.
But what is a secure payment service and why is it so important for businesses to have one?
What is a secure payment service
Secure payment services help businesses accept and manage secure online payments made by credit card, debit card, or direct debit. A secure payment service should handle the entire payment process from end-to-end from the moment the customer enters their payment details to the time when the business receives the payment.
Like Biz Core’s Microsoft Azure Security, a secure payment service should have strong built-in security specifically designed to protect the sensitive information of both customers and the business.
How online payment systems work
Alhough a secure online payment system makes the process look fast and easy, there are quite a number of factors involved.
Who’s involved?
Generally, the main entities involved in an online payment include:
- The customer – a customer will use their credit or debit card to purchase goods or services from your business.
- The merchant (you) – the person or business providing the product or service. As the merchant or business, you will also need a merchant account for customers to transfer funds into.
- The payment processor – communicates with the issuing bank via their card networks.
- The issuer – the financial institution or bank that issues the credit or debit card.
- The payment gateway – a virtual, cloud-based system that works similar to an in-person POS system and ensures payment information is encrypted and secure.
How does it work?
The online payment process usually follows these general steps:
Step 1: customer uses their payment card to purchase goods or services
Step 2: the payment information is sent through the payment gateway, encrypted and secure to the payment processor
Step 3: the payment processor communicates with the issuing bank to ensure the customer has sufficient funds to approve the payment
Step 4: the payment processor will communicate with the merchant as to whether the payment is approved or declined.
Step 5: The payment is settled and the funds are deposited into the merchants bank account, usually at the close of business that day.
What are secure payment methods
A secure payment means that both the businesses information and the customer’s information (such as their credit card number, credit card expiry date, and CVV) is encrypted during the payment process.
Typically, one of the safest methods of payment is credit cards. This is because most credit card issuers will routinely monitor credit cards for fraudulent transactions and suspicious activities. Credit card issuers will also often offer their customers zero fraud liability coverage, meaning customers are not responsible or liable for any fraudulent charges that may occur. When this routine monitoring and fraud cover is combined with a secure payment service, credit cards become one of the most secure payment methods available.
However, all payment methods come with their own risks and using a secure payment service can be a good way to ensure the sensitive information of both you and your customer is secure regardless of the payment method chosen.
Which online payment system is best
Each business will have its own unique needs and non-negotiables and it’s important to research every secure payment service carefully before making your decision.
However, there are some important features to look out for when doing your research.
Built-in security
When handling sensitive information, it’s vital your secure payment service has strong built-in security features that protect both you and your customers. The security should offer full encryption and protection against fraud.
Free trial or demonstration
Finding a secure payment service that offers a free trial or demonstration is important. This will help you determine if the product is right for your business before making any commitments.
Upfront fees
Hidden fees can be a nasty surprise for any business, so make sure you choose a secure payment service that is upfront with their fees and charges.
Multiple payment methods
Customers like choice so having a variety of payment methods to choose from can help keep your customers happy and loyal.
Flexible payment schedules
Offering customers a number of payment options can be a great way to ensure your business is paid on time. Find a secure payment service that offers weekly, fortnightly, or monthly payment options.
Customer management tools
The best secure payment service should offer customer management tools that keep track of customer information, customer interactions and payments. This will take some of the admin stress out of running your business.
Secure more with Biz Core
Looking for a secure payment service but not sure where to start? Biz Core is here to help!
We offer a free live demonstration with our experts so you can be sure you’ve found the right fit for your business.
Contact Biz Core today for more information or to book your free live demonstration.
FAQs
How do online payment gateways work?
You need a payment gateway and processor to securely verify, authorise, and transfer funds from a customer’s bank account to your merchant bank account.
An online payment gateway works like an in-person POS system but it uses cloud-based software to process digital payments. The sensitive card information travels along an encrypted payment processor between the merchant bank account and the customer bank account in order to:
Verify card details
Conduct fraud checks
Check sufficient funds are available
Authorise the transaction
Transfer the funds to the merchant account
How does credit card processing work?
Though this process only takes a matter of seconds to complete, credit card processing actually consists of multiple factors.
Credit card processing follows the following process:
- Customer pays for their goods or services by credit or debit card.
- Payment information is sent to the credit card processor who communicates with the issuing bank via their card networks (such as Visa, Mastercard, American Express etc.)
- The bank will assess whether the cardholder has sufficient funds or credit to complete the transaction, and may also check for any fraudulent activity. The bank will then respond with whether the credit or debit card has been approved or denied.
- Approval or denial is sent to the payment processor who will communicate this information back to the merchant.
- The payment is then settled. This occurs when a batch of approved transactions for that day is processed (usually at the close of business) and a customer’s account is charged. The money is then deposited into the merchant's account.
What is credit card processing?
Credit card processing refers to the multi-step process needed to finalise payments made with a credit card. This includes credit card payments made in person, online, by phone, or by mail.
With Biz Core’s efficient and reliable system, we look after the credit card processing for you and make it easy for your customers to make online payments, set up recurring payments, and manage their direct debits.
Contact us today to find out how we can help.
What are the steps in payment processing?
Generally, online payment processing consists of 5 steps:
- Customers complete the online check out process, entering their credit card or debit card information into the payments system.
- The credit or debit card information is transferred to the payment gateway, then to the payment processor.
- The payment processor transfers the transaction information to the card network and verifies the customer’s credit or debit card details.
- The credit card network then requests authorisation to release funds from the issuing bank. The bank will provide a response back to the credit card network.
- The credit card network sends this response back to the payment processor, who will request that the issuing bank transfer the funds. The funds are transferred to the merchant account, and then to the business’s bank account.
Biz Core’s payment processing platform does all the work for you so you can focus on more important things like growing your business and securing more memberships.
Contact the Biz Core team today for a live demo!
Which is the best online payment gateway?
When you are choosing a payment gateway for your business look for the following features:
Multiple payment options
Security features
Website integration
Customisation
Checkout pages
Easy-to-use functionality