What Happens at a Payment Processing Center?
A payment processing center accepts payments and transactions from customers, processes them and submits the funds to the business’s bank account, as noted by Kabbage.com. Some processors are set up to solely accept digital payments, as in credit and debit card payments, through a merchant’s online store.
Businesses all around the country use payment processing centers to save time and effort in sorting, validating and accepting customer payments. Mail-in processors may accept personal checks and money orders sent by customers and deposit the funds from those payments into the merchant’s bank account, as noted by USBank.com. This includes picking up mail from the post office, opening checks, inputting the customer’s payment information and keeping track of incoming versus outgoing funds for the merchant. Some banks, like U.S. Bank, also provide this service to businesses that have banking accounts with them.
Digital payments are processed at these payment centers through a payment gateway, the software that completes a sale on the business website. The customer’s payment information is sent to the financial institute for confirmation. Money from the payment is deposited to a temporary account managed by the payment processor. The processor deducts a small fee for its services and the remainder of the money is transferred to the merchant’s bank account.
