HOW INTERNET CREDIT CARD PROCESSING WORKS:

1. The online customer finds the merchant's website and adds products to their shopping cart. When they are ready to check out they either enter their billing information.
   
2. If the merchant does not have a secure page, the customer can be transferred to the merchant's secure payment gateway where they can enter the billing information into a secure form. If the merchant does have a secure site, then the information will be "passed" to the payment gateway without the customer ever leaving the merchant's site.
   
3. Once the billing information has made it to the payment gateway it is then transmitted to the processor.
   
4. The processor will then pass that information onto the bank that issued the credit card. The issuing bank will check to see if the card is valid and see if the amount requested is available on the card and set aside the amount of the purchase for the merchant.
   
5. The issuing bank will send back an approval number or a decline message back to the processor.
   
6. That information will then be passed back to the payment gateway. It will take approximately 3-15 seconds to complete steps 2-5.
   
7. The payment gateway will then pass the approval code back to the merchant's site. At this point the merchant can also choose to have the payment gateway email the customer a payment receipt.
   
8. At the end of the day the payment gateway will "settle" all of the day's transactions. Once the settlement process is initiated the funds will be transferred from the card issuing bank and will electronically deposit them into the merchant's checking account. It typically takes 2 business days from the time of the original transaction for the funds to reach the merchant's checking account.