There’s a lot that goes on behind the scenes when a customer swipes their card. Rather than foisting all that complexity on you owner who is worrying about credit card processing for small business, Moolah feels that it’s our task to clarify and simplify. Still, it’s a complicated process. Let’s focus on one term: Batching, and why you don’t have to worry about it.
Step one to understanding batching is to realize that there are two distinct processes that take place when a credit card is used for a transaction. The first step is the one that you see: a credit card transaction is “authorized” by the issuing bank. One of two things can happen here, and they happen instantly: either the card is “approved,” or “declined”. This, however, is not the end of the story. More needs to be done to make sure that the funds successfully get from the cardholder’s account to your business’s account.
Step two of the process, after authorization, is the “capture” process. It’s called that because you the vendor must “capture” all the transaction data for the period of time, usually for the business day, and send them to your credit card processor.
Some businesses don’t use a payment gateway, but rather rely on their standalone terminal and their payment processor. One notable company that does things this way is Dharma Merchant Services. Businesses that use a standalone terminal must do the batching themselves. There are a few options, either setting up a manual batch out, or automatic. The important thing for these vendors is to batch within 24 hours. If they don’t the business stands the risk of being charged a different (higher) interchange rate when the transactions are sent to be processed. These interchange rates are complex, and live on big, tough-to-parse tables. At the end of the day, most people handle their batching in a timely manner, and therefore probably don’t worry too much about their interchange rate. Still, it might be a little bit of a concern for some to potentially be charged a different rate in the event that something prevented them from batching within 24 hours.
Moolah relies on Authorize.Net as its payment gateway. That means you don’t have to worry about batching—it happens automatically. This gives you the comfort of knowing what you’re paying at the end of the day, end of the month, and always. Some things are just way too complicated to have to sort through, and we at Moolah felt that batching and interchange rates are one of those things. Credit card processing for small business doesn’t have to have a learning curve. With transparency and simple service, Moolah saves you from the annoyance of batching.