What does a virtual terminal do?

31 Aug 2022 By PAYCEC

Virtual merchant accounts and card providers like Visa, Mastercard or American Express operate in close coordination. They support online merchants in connecting with a payment gateway so that payments can be processed. As a result, the consumer's electronic payment is used to execute all transactions with merchants.

Virtual terminals utilize non-physical software programs however function very similarly to a physical card terminal. Here is how it works:

• Step 1: Consumer browse on merchant’s website and choose items to place into cart
• Step 2: Customer visit cart and process checkout
• Step 3: The customer is redirected to a virtual payment gateway platform
• Step 4: Choose the payment method option and enter payment credentials & billing address
• Step 5: 3D secure Authentication requirement (OTP SMS or private key)
• Step 6: The virtual terminal collects payment details and transmits to a processor or the merchant bank
• Step 7: Merchant bank receives an order and proceeds data with tokenization and fraud check
• Step 8: Merchant bank transmits data to card network for further verification
• Step 9: Card network or clearing network sends data to issuing bank for processing fund to merchant bank
• Step 10: Merchant bank informs the result of the electronic transaction (approved or denied)
• Step 11: Customer receives the delivery