Manual and real-time payment

Your choice of manual or real-time processing totally depends on the number of transactions that occur on your site. Manual payment processing is viable when the volume of transactions expected is low. Manual processing means the order is received with the credit card number through a phone call, fax, or online form and processed manually, either by contacting the payment processing company to verify the validity of the credit card or by swiping the card at point of sale terminal.

It is not only less expensive than real-time processing but also prevents fraud occurrence, as you have more control over the processing procedure. The major disadvantage is the amount of time taken to manually process orders. Any significant increase in the transactions number will make manual processing too extensive and inconvenient. Though it is time consuming, it is relatively risk free.

If you choose batch payment processing, you essentially have two options that enable you to manually process orders. One, you can purchase software that allows you to transact your orders manually. The software is housed on your computer’s hard drive and is connected to your bank through a modem and telephone connection. Second, you can buy a point of sale terminal to key in credit card numbers as they come in.

Leasing a terminal is an option, but it is not always the cheapest route. For example, perhaps you want to purchase a POS terminal that would cost you $400 to buy. To lease the same terminal using a 10 percent interest rate for three years you would pay $520. So, in fact you are paying $120 more than if you had purchased the terminal. And, in most cases, the original price is marked-up to start. Therefore, it is better to shop around and look for the best purchase deal.

On the other hand, real-time payment processing is the process where the credit card is automatically processed when the customer submits an order. Once the credit card is verified and approved, the customer receives immediate notification that the order is accepted and the funds are transferred from the customer’s bank account to the merchant’s account.

Real-time processing is very quick and better for large volume sales and for products that are sent electronically. Time is saved in processing the order, but it is more expensive to have and requires continuous monitoring to ensure there is no downtime.

Keep above facts in mind while choosing between batch (manual) payment processing or real-time payment processing.