- January 6, 2020
- Posted by: admin
- Category: Uncategorized
This article will answer some of the most frequently asked questions in very simple and easy language which will help the merchant to choose the best payment solution.
· What are CNP transactions and how it works?
· How are CNP transactions so popular and beneficial?
· What is a virtual terminal?
· What is the importance of virtual terminal in CNP transactions?
If you are a merchant who is looking forward to making the experience of his customers better by offering online payment through debit/credit card then stick around because by the end of this article you will have plenty of information to make a decision best for your business growth.
What are CNP transactions and how it works?
CNP is an acronym for the “Card-Not-Present” transaction and it is very much clear from the full form itself that in this type of transaction credit/debit card is not used directly. Basically, when the transaction is completed without cardholder and card-present physically to the seller it is known as CNP transaction. The information of the card is generally exchanged over email or phone. Many people get confused and think any transaction which is done via debit/credit card is CNP which is not true. Any transaction can be called CNP only when cardholder and seller are not in the same place.
The same credit card information is required for all CNP transactions. To make payment of purchase online, a form has to fill out by customers over the internet that will send data to the payment gateway to process further. Later the information is reviewed and a request is approved or declined by the payment processor, issuing bank and card network.
How are CNP transactions so popular and beneficial?
In this era where everyday competition is growing, evolution is the key to survival. As a business, you have to evolve and improve the experience of your customer to stay in the market. CNP transaction helps your business to grow overseas; many more customers from different parts of the world can easily reach you. Another major advantage of the CNP transactions is that it saves a good amount of time. Other than this, in the last 5years, quite a large number of people have switched online and in the coming years numbers will continue increasing.
What is virtual terminal?
CNP transaction has earlier considered risky because of lack of security, obviously, how can a customer provide sensitive information about his debit/credit card to the seller. Here, the virtual terminal plays its role, it provides security, fraud detection tools and also handles additional tasks like the processing, verification, and reporting of credit/ debit cards very efficiently. It is installed on the web-page of the merchant’s business website. A web-based application that allows you to enter debit/credit card detail manually using the internet is known as Virtual terminals. It is a very short and easy process; in a fraction of time payment is processed to complete the transaction.
The general steps followed in a typical transaction are:
Ø Transaction is obviously initiated by the customer. Credit card details or ACH details are provided by the customer over the phone or via mail.
Ø You then log into your virtual terminal to insert the customer’s payment information. Make sure you are connected to the internet.
Ø After rechecking the information, the transaction is approved and then processed.
Ø Parties involved get quick notification of the successful transactions.
It is also a big doubt among merchants that virtual terminal works for only some specific nature of businesses. Whereas, virtual terminal benefits almost all fields of business, whether you are in the gaming industry, traveling, CBD oil, food delivery, the local pharmacy, local professionals or any other business type.
What is the importance of virtual terminal in CNP transactions?
So far now you must have understood how virtual terminal and CNP transactions contribute to the growth of a business. Now let’s discuss the advantages of the virtual terminal and the importance of virtual terminal in CNP transactions.
- Secure: most importantly, virtual terminals make CNP transactions safer with PCI compliant way to accept credit/debit cards from your customers. Data encryption and tokenization make payment gateway safekeeping your sensitive information secure during transmission. Fraud detection is also easier. Information like cardholders’ name, expiry date, billing and shipping address and the CVV/CSC code should be obtained and entered into a virtual terminal.
- Easy to process: It is not rocket science so why not use it and make the shopping experience of customers smoother, better and safer. A few easy steps to follow and you are done. Without even the presence of your customer, you can complete the sale.
- Quick: Virtual terminal makes CNP faster. In this fast-moving world nobody wants to wait, “the faster the better”. And this is one of the key reasons why online shopping is on the boom. In very little time, from any part of the world, anyone can buy anything.
- Less investment: Though CNP transactions charge extra fees but depends on other factors as well. Overall virtual terminal saves you from investing in expensive point-of-sale software or credit card machines also you need not invest in a cash drawer if you don’t sell anything in person.
- More control over transaction: CNP transactions are quite risky for merchants as the chances of chargeback are high. With virtual terminal the entire transaction process in merchant’s control. The only merchant has access to the virtual terminal interface.
- Doesn’t take space on the counter: Other than any other advantage, most merchants enjoy the fact that a virtual terminal doesn’t take occupy any physical space.
- Help business to grow beyond: Expansion of business without setting up a proper office in a new place is now has become possible because of a virtual terminal. Your business is no more bound geographically. You can easily make new customers.
- More freedom and flexibility: Virtual terminal makes CNP transactions possible anywhere from any device at any time you only need to have an internet connection.
- Easily handle recurring payments: Additional advantage of the virtual terminal is that it easily handles recurring payments, unlike physical POS counterparts. For instance, if someone buys monthly medicines and has enabled the recurring payment service then he doesn’t have to give his card details again.