There are many different players involved in the ecosystem of payment processing. From a cardholder’s point of view it seems very simple and quick but it actually is quite complex.

  1. Cardholder: Makes a purchase from the merchant, entering their information and authorizes the initiation of the transaction
  2. Payment Gateway: Forwards transaction information directly from cardholder to payment processor
  3. Processor: Facilitates the transaction information from the payment gateway to the card network
  4. Card Network:  The network routes the transaction information to the issuing bank to receive the bank’s authorization
  5. Issuer: Receives and verifies the transaction information; if the credit or debit funds are available, the issuer then sends an authorization code for the transaction back to the card network
  6. Card Network: Receives the authorization approval and forwards the authorization to the processor
  7. Processor: Receives the issuer’s authorization approval from the card network, then forwards that information to the payment gateway
  8. Payment Gateway: Receives the authorization approval from the processor and sends it to the merchant to complete the transaction
  9. Merchant: Receives the authorization, fulfills the order, and batches the transaction information for submission to the Acquirer
  10. Acquirer: Receives the batched transactions at the end of the day, then deposits an amount into the merchant’s account minus applicable fees or reserve requirements

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