Collecting Your Due Payment
Methods for Receiving Payment
Due to the fact that Internet sales are not a face to face transaction, once you have made the sale it is essentual that you are fully paid before delivering the goods or services, and most importanly, stay fully paid after delivery has been made.
The most suitable method of receiving payment will vary from merchant to merchant, depending upon - whether the delivery is by digital or physical means, - if by physical means, the size and mass of the article - if the delivery is local, national, or international, if insurance is required, also there are many other factors which could dictate the method of delivery and/or payment.
Due to the circumstances above many merchants may find that they need to provide their customers with several different options for payment with the method of choice depending upon the nature of a particular transaction, also the acceptability to both the customer and the merchant must be taken into account.
Ultimately it will be the merchant who states the terms of payment which are acceptable, and there are a range of options available to merchants which tend to fall into the following four catorgaries - On Line to On Line - On Line to Off Line - Off Line To Online - and Off Line to Off Line
Charges and Costs
Many merchants may already have either an EFTPOS or a MOTO merchant account, however an EFTPOS terminal can be expensive. The most popular and least expensive is the manual MOTO/CardLink™ type merchant account setup. This is where your bank supplies you with an online terminal as part of your manual Mail Order/Telephone Order (MOTO) merchant account set up with them. You login to a secure online website (just like internet banking) and enter your customers credit card payments that come to you via fax machine, telephone, email, or through regular mail. The MOTO/CardLink™ type merchant account facility from a bank is an ideal merchant facility solution and is a supremely affordable merchant account facility from a bank. All Australian banks offer this type of merchant account and they are usually priced at around $29.00 per year, plus the usual bank transaction fees.
These manual merchant accounts from your bank must never be used to transact credit cards "live" on the internet. It would be a breech of your bank's merchant account terms and conditions if you attempted it. All credit card transactions actually processed "live" on the internet must be flagged with a special code that is transmitted automatically to a more expensive type of merchant account designed specifically to work with "real time" payment gateways. This code identifies the transaction as being an internet based live e-commerce transaction being performed by a "real time" credit card processor directly into the merchant account automatically.
You can of course also charge credit cards manually into an existing EFTPOS machine, and most banks have different varieties of manual merchant account facilities available, also with a real merchant account at a bank, your proper business name will appear on your customers credit card statements, not some third party name.
The use of Ecommerce (doing business via the Internet) has dramatically risen in Australia and around the world over the past few years. This has been mainly due to the fact that consumer confidence in paying for goods and services over the internet using their credit cards has reached an all time high. Years of research and development has led to more secure, reliable credit card transactions. In fact, even the major banks have been saying that using your credit card over the internet is generally safer than using it in a ‘bricks and mortar’ store!
This has been great news for businesses of all sizes as they have found their websites generating extra revenue and helping their organization to greater profits. Unfortunately, in recent times the threat of credit card fraud is now rising at a rapid rate and many businesses do not realise the lack of protection they have until they become victims themselves. It has now been stated that the year 2007 was the year that organised crime took over the internet and that their degree of expertise is rapidly on the increase.
Speak to any of the major banks and you will find that there is very little protection for merchants who accept credit cards over the internet, even if they are using the banks own payment gateways. All it takes is for the owner of a credit card to contact their bank and dispute a transaction to cause an often irreversible charge back to the merchant.
To avoid becoming a victim of credit card fraud, merchants need to be more ‘street smart’ in regards to payments made over the internet. There are certain high risk areas that you should be aware of when accepting these payments:
- International purchases
- Purchases coming from countries / regions that you don’t usually deal with
- Purchases made that are of much higher value than your regular transactions
- Customers who try a few different credit card numbers to get one that will go through
- International purchases that demand overnight or express packages
- The use of post office boxes as a delivery address
- The use of a free email service as the contact details (such as Hotmail or Yahoo)
Although these circumstances do not immediately suggest fraud, it has been found that fraudulent transactions are more likely to occur then. If you are suspicious of a transaction that is taking place, try using one or more of the following tips to make the transaction more secure:
There are no 100% fraud proof methods for accepting credit cards over the internet but by following some or all of these tips, you can significantly reduce the risk to yourself. Remember that even if a transaction has been authorised and cleared by your bank, it can still be subject to fraud and charged back against your account at a later date (even weeks or months later).
- Ask for the 3 or 4 digit security number on the card. All Visa cards have a 3 digit number on the back of the card and all Amex cards have a 4 digit number on the front. Many people who have access to stolen credit card lists do not have access to these numbers.
- Request a contact phone number for the delivery address and try speaking to the person by phone to verify their identity.
- Always try and deliver to a residential address, especially when delivering overseas.
- Check the delivery address against the phone number supplied using an online phone directory.
- Ask for a photo copy of the front and back of the card to be made and either scanned and emailed or faxed.
- If you still feel uncertain or nervous about the transaction, ask for another method of payment such as a bank to bank transfer or bank cheque. Note: Don’t send the goods until payment has been received and cleared.
- Never accept credit card details via email. Always demand they are entered via a SECURE payment gateway.
- Use a manual credit card gateway to accept payments so as you can check the information you have obtained.
All merchants should accept the responsibility of securing their own information, if you do not allready have, or are not sure about your site security check out the site below from Westpac.
Automatic Online to Online Payments:-
Credit Card Payment Gateways
There are many organisations that will provide you with the abilty to accept payment from your customers using their Credit Cards, such as MasterCard/Visa /Amex/Discover® Network, etc. and also many types of Debit Cards, and these are generally known as Credit Cart Gateways
Credit Card Gateways are an ideal solution to complete the transaction when using an ecommerce website that includes a shopping cart facility. Generally, regardless of which ever facilitator you choose to use, they will supply you with a package of customised code, which you include into your webpage to open their secure gateway and process your customer payments. These automatic gateways provide an easy and powerful solution for medium to high volume merchant sales.
Common to virtually all gateway providers is the requirement that you need to have an Authorised Merchant Account with your bank, as it is the Merchant Account that settles the funds into your account, not the facilitating Gateway.
Many merchants may already have either an EFTPOS or a MOTO merchant account, however before attempting to accept payments online "live" in real time via a Credit Card Processing Gateway, the account must be authorised by the merchants bank to automatically accept and settle such payments into the nominated account.
Manual Online to Online Payments:-
Accepting Credit Card PaymentsThere are some other secure methods of accepting credit card payments online which can be instigated from a "Buy it Now" button or similar link placed on a page of an ecommerce website. Once the secure Credit card Information has been received by the merchant it can then be manually processsed using an existing merchant account as described below.
Manually Processing Credit Card Payments
Almost all Australian banks have various types of merchant accounts available to merchants and almost all of them will allow you to manually enter your customers credit card details for processing just as you would if you received an order and credit card payment over the phone, by a fax machine or by regular mail.
It can cost as little as around $29.00 per year, plus the usual bank transaction fees to own a merchant account at an Australian bank, and these accounts are ideal for the smaller to medium sized established merchant to start selling online. Every bank in Australia offers these types of manual merchant accounts. They are a MOTO/CardLink™ type merchant account but may be branded differently from one bank to the next.
These types of manual merchant accounts give you a secure website page (just like internet banking) which enables you to easily charge the credit card payments directly into your merchant account that have come to you via fax machine, telephone, normal physical mail and Payecom. An exceptionally easy, powerful and inexpensive merchant account suitable for many low to medium volume solutions.
Online to Offline Payment Choices:-
This is the most secure payment method for merchants as there is no risk of chargebacks. To learn more about this method follow the link below.
Link To Online to Offline Payments Sites
Offline to Online Payments:-
Credit Cards - Debit Cards:-This method of payment relies upon Credit Card details being sent By Telephone - Fax - Email or Regular Mail directly to the merchant, which are then processed manually through an existing EFPOS Merchant Account
Offline to Offline Payment Choices:-
Often known as Bank Wire Transfers or Bank Cash Transfers. Usually arranged by the buyer personally visiting their regular bank and presenting either cash or a cheque made payable to the bank, with delivery instructions for the recipitents bank details.
CODCash On Delivery - Collected by the delivery agent at the handover of the goods.
Regular Mail/Air Mail:-Money Order - Personal Cheque - Cashier's Checks - Certified Checks,