What is Global Payments Card Processing?

From the perspective of global payment card processors, Visa, MasterCard, American Express, Discover Card, etc., and other global payment card processors authorize major financial institutions to issue bank cards with logos for institutions, and provide forwarding and clearing services. The bank card industry is a two-sided market with network externalities. Therefore, various factors such as the intensity of competition, the level of cost, and the needs of both the supply and demand sides of the market affect global payments card processing fees, which involve the issuing bank, the acquiring institution, the card holder, and merchants.

With the rise of global e-commerce, online payment methods have become more advanced. A convenient and easy-to-use payment gateway is like a hand that collects money for you, and it is closely related to the income of the merchant. As the world’s leading global payment solution provider, Oceanpayment can help deal with online credit card payment processing, which enables merchants to easily set up an account and use it, and also helps merchants to be familiar with and trust our services.

The development of global payments card processing

The development of credit cards can be traced back to the middle of the 18^th century. As early as more than a hundred years ago, in the United States, the birthplace of credit cards, Mr. Auther Morris invented the credit card advertised as “enjoy first, pay later”. However, the cards at the time were made of metal and were issued to a limited number of places, and they were restricted to certain places: for example, the petroleum credit card launched by General Petroleum Company in 1924 for company employees and specific customers was treated as a VIP card. As a means of promoting oil, it was later issued to the general public. Due to its good effect, it attracted other companies such as oil, telephone, aviation, and railway to join in, and the credit card market began to develop.

The development of global payment cards has suffered two major setbacks. The first was during the Great American Economic Panic, when many companies suffered losses due to bad debts and credit card fraud; the second was during World War II, the Federal Reserve Board banned the use of credit cards during the war. However, these could not stop the later development of credit cards. In 1951, the Diners Card came out. The embryonic form of modern credit cards gradually took shape. Cardholders showed this card when they made purchases without having to pay cash. The card company advances the cardholder’s money and asks for a merchant discount from the merchant, and then charges the cardholder monthly. Its business scope has gradually expanded from the original restaurant to hotels, airlines and other tourism-related industries and general retail shop.

In the 1950s, nearly one hundred banks joined the ranks of processing global payment cards. However, due to limited business volume, limited to local banks, no annual fees, and increased non-performing debt rates, many banks were unable to withstand losses and withdrew one after another. Only small and medium-sized financial institutions Organizations are striving to survive on the edge of profit. And these surviving banks began to seek innovation and change. During this period, banks provided revolving credit payment methods to enable cardholders to pay more with flexibility, banks also increased interest income. After that, cardholders gradually became accustomed to using revolving credit, and the booming development of credit cards began.

The progress of global payments card processing fees

Processing fees of each credit card transactions varies between different companies. The exact amount depends on the payment network (e.g., Visa, Mastercard, Discover, or American Express), the type of credit card, and the merchant category code (MCC) of the business.

Note that debit cards have a different pricing model, and they usually cost less for merchants. This is why you may only see a convenience fee for a credit card and not a debit card purchase. Those ranges include the two types of fees that payment networks charge for each transaction: interchange fees and assessment fees. They don’t include payment processing fees, because fee structures vary considerably depending on the credit card processor you choose.

Now, let’s take a closer look at the fees that get taken out of every credit card transaction:

Interchange fees

The bank that issues the credit card receives the interchange fee. For example, if you have a Chase credit card on the Visa payment network, Chase receives the interchange fees on your transactions.

Assessment fees

The payment network receives the assessment fee. In the example above, Visa would receive the assessment fee on every transaction where you used your Chase Visa card.

Setup fees

A credit card setup fee is a one-time fee charged by a credit card company when a new credit card account is opened. You may have to pay the payment processor to open a merchant account with them. This might cover a technician that comes to set up the necessary hardware, or who provides customer support for the setup over the phone.

Oceanpayment global payment solutions

Oceanpayment has long provided product and operational support payment security services for global merchants as a gateway, especially in Hong Kong and Singapore.

As fully licensed FinTech company with global digital payment technology and business qualifications, Oceanpayment has the highest level of security certification in the global financial industry PCI DSS LEVEL 1, Visa, MasterCard, American Express, Discover, UnionPay International, JCB and other certification services Merchant or acquirer qualification, Google Pay and Apple Pay PSP certification

is the only fully licensed FinTech company in China with global digital payment technology and business qualifications. For more details, please contact us here>>>