What is Mobile Payment Processing and How Does it Work?

Mobile payment processing allows you to accept payments directly on mobile devices. This type of mobile payment solution is typically used by online merchants or brick-and-mortar stores that need to take credit cards, debit cards, and other forms of payment. The secure technology uses the same card network as traditional terminals so customers don’t have to sign up for new cards and checkout with the same information they’re used to providing. Transactions are usually faster than card-present transactions as there is no signature required and approvals can be given in seconds.

• Advantages of Mobile Payment Processing

• Customers don’t have to carry cash or keep track of credit cards

• Eliminates need for cash registers

• Transactions are quick and secure

• Saves money on processing fees that can be charged for card-present transactions

How does it work?

Mobile payment processors act as the “middleman” between buyers and sellers. Buyers use their credit cards to pay merchants through mobile apps or websites which pass along transaction details to the processors. The processors verify the purchase and send back a confirmation to both parties. This gives buyers guaranteed protection against fraud while allowing merchants access to sales that might otherwise be declined through traditional terminals.

Types of Mobile Payment Processing

Mobile payment processing can be broken down into three categories: online, offline, and hybrid solutions.

Online payment processing works where both the merchant and buyer are on the Internet. For example, a customer purchases an item on a website and chooses to pay through their mobile device. Offline solutions allow customers to complete transactions via a physical point-of-sale (POS) terminal using a smartphone or tablet. A hybrid solution is when merchants accept online orders while completing transactions offline.

How Mobile Payment Processing is Different from Other Forms of Online Payments?

Mobile payment processing differs from other methods of online payments in that it works directly with the credit card companies. This adds another layer of security at the point-of-transaction. For example, if someone were to use a stolen credit card number to purchase an item, the card issuer has the ability to reverse charges or hold the merchant responsible.

How Does Mobile Payment Processing Protect My Customers?

Mobile payment processing protects buyers by allowing them to enter their credit card information directly through a secure app or website. Credit cards are encrypted before they’re stored on your device and during transmission between the device and the payment processor.

What if a Customer’s Device Doesn’t Work?

Merchants can use mobile card readers as an alternative to accept credit card payments on their smartphone or tablet. Most of these devices work with eCommerce websites, apps, or both so merchants don’t have to manually enter transactions into their system.