What is eCommerce?
E-commerce is the buying and selling of
goods and services across the Internet. An e-commerce site can be as simple as a
catalog page with a phone number, or it can range all the way to a real-time
credit card processing site where customers can purchase downloadable goods and
receive them on the spot. Electronic commerce merchants can range from the small
business with a few items for sale all the way to a large on-line retailer such
as Amazon.com.
About Online Payment Processing
When a customer purchases an item with a credit card, a two-step process begins.
- The merchant or the website requests an authorization
from the customer's credit card account to ensure that the card is valid and
the customer has enough available balance for the purchase. The customer's
bank sends an authorization number back to the merchant or the website and
the order is "captured".
- The merchandise is sent, and the merchant informs the
bank where they have a merchant account. The bank deposits funds to the
merchant's account while the customer's account is debited for the amount of
the purchase. At that time, the customers' bank takes out the required fees
and the transaction is complete.
Credit cards are an important part of enabling Internet
commerce. The easiest process to integrate into an existing business is an
off-line authorization and settlement process. For more advanced web merchants
who are processing more than 100 transactions per month, real time credit card
authorization becomes economical. With a link to a Processing Service Provider
such as Cybercash or AuthorizeNet, the website generates an authorization
request when the customer places the order.
If the merchant is selling hard goods that have to be
shipped to the customer, then the order is saved securely for later settlement. Once
the goods are shipped, the merchant can settle the order, and the transaction is
completed. If the merchant is selling downloadable media, software, or site
memberships for example, then the order can be authorized and settled in real
time, without any intervention by the merchant.
For more information about e-commerce and how it works with eStores NorthWest,
please download our
Online Payment Processing Guide.
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