When you want to enable card payments in your web shop, you need to understand the process and collaborate with relevant partners. The Internet Payment Gateway (IPG) is an essential participant that enables the processing of card transactions in an online store.
When we say that the IPG processes transactions, it means it transfers them from the web shop to the acquiring bank to initiate the payment transaction and vice versa, providing the merchant with a response from the bank regarding whether the transaction is approved or not. The IPG is connected to one or more acquiring banks. See the banks to which CorvusPay is connected.
One-time payments
All banks accept one-time transactions with Mastercard, Maestro, and Visa cards, while transactions with Diners and Discover, as well as American Express cards, are only accepted by some banks. Cards from all issuers worldwide are accepted. Therefore, a customer from, for example, Canada with a Visa card issued by a Canadian bank can make a one-time payment in the web shop just like a local customer with a card issued by a local bank. In Serbia, there is also the Dina card, accepted by all local banks.
Installment payments
Installment payments in web shops are only possible for cards issued by local banks, meaning that foreigners cannot make installment purchases. To support installment payments for clients of a particular bank on your web shop, you must have an acquiring agreement with that bank because for installment payments, the same bank must be both the issuer and acquirer. It is worthwhile to negotiate installment payments with all banks that have a significant market share, as this means that many customers have cards issued by those banks.
Negotiating acquiring in local currency
You have the autonomy to decide through which bank or banks you want to negotiate card acquiring. The terms for acceptance are subject to an agreement between you or your web shop and the bank. The transfer of funds from the customers’ accounts to your web shop’s account and vice versa is handled by the banks with which you have contracted acceptance. The timelines and conditions for fund disbursement are defined in the agreement between your web shop and the acquiring bank. Besides the fees paid to the banks, you pay the IPG for processing at the prices agreed upon in a separate contract. Find more information about fees for online card transactions.
Contracting acquiring for foreign currencies
When acquiring is facilitated through local banks, the prices on the payment form may be displayed exclusively in the local currency. To provide transaction processing services in foreign currencies, the IPG can be connected to one or more foreign banks. Foreign banks also offer support for various card brands, and transactions can be single payments only. For example, if you want to offer products or services in the Czech Republic, the United Kingdom, Sweden, or any other country with a local currency, it makes sense to display prices to customers from those countries in their respective currencies—not just informatively on the website but also on the payment form when the customer enters their card details.
On-us and off-us transactions
Each payment card contains the Bank Identification Number (BIN) of the bank that issued it. Based on the BINs, the IPG redirects transactions to the acquirer bank to which it should go according to your instructions, depending on which banks you’ve contracted for acquiring and at what rates. For their own cards, also known as “on-us” transactions, each bank will generally provide you with a lower fee. For transactions with cards from all other banks, known as “off-us” transactions, you will be charged a higher fee. These fees for cards from other banks can vary from acquirer bank to acquirer bank, so you’ll route all transactions with cards from banks with which you haven’t contracted for acquiring to the bank that offered you the most favourable fee for other banks’ cards.
Activation of card payments in web shops requires careful planning and collaboration with a reliable IPG and acquiring banks. Therefore, think carefully when choosing your partners for the flight. CorvusPay and I are always at your disposal.
Edgar