Card Not Present
In the present world situation today, a business in order to facilitate more sales has to accommodate more touchless and online transactions. And your business is no different. It needs Card Not Present Transactions.
What are card-not-present transactions (CNP)?
They are card payment transactions wherein the cardholder cannot physically present the actual card that can be examined visually by the merchant. The card details and the cardholder identity need to be authenticated through a specific process at the same time that the buy order is announced and the payment consummated.
What are examples of CNP transactions?
Common card-not-present transactions include online purchases, telephone orders and recurring billing. Examples include:
- Buying online, through eCommerce when customers purchase merchandise on the internet.
- Recurring subscriptions and payments that are customized and set up to bill automatically every month or other scheduled frequencies.
- Invoices that are set up to be paid online.
- Purchases over the phone, when a client provides credit card or debit card information to facilitate the payment.
- Mobile wallet payments through an app.
- Online shopping through Buy buttons.
How do you set up an account to accept them?
Confirm that a provider supports your specific shopping cart, gateway and payment methods. Compatibility and merchant eligibility must be verified for the proposed setup; a list of platform logos is not a guarantee of integration or approval.
It should also have a simple process for eCommerce refunds and for letting customers have the luxury of choosing their CNP options.
Ask about support hours, escalation paths and who handles payment or refund questions. Confirm the service included in your agreement.
Compare integration requirements, reporting and the full pricing schedule. Setup, monthly and transaction fees vary by provider and agreement.
What are the Costs?
Review processing pricing alongside gateway, account, refund and chargeback charges. A quote should explain which costs apply to your business.
A virtual terminal may let authorized staff enter payments in a browser. Confirm required software, access controls and supported devices with the provider.
For illustration, a processing fee of 3.5% plus $0.15 on a $100 transaction would cost the merchant $3.65. It does not automatically make the customer’s bill $103.65. Any surcharge or other customer-facing fee requires a separate review of applicable law, card-network rules, eligibility and disclosure requirements.
Use the provider’s approved checkout and fraud controls rather than inventing identity questions or collecting unnecessary personal information.
A checkout may request card details and billing information appropriate to the transaction. PCI SSC states that card verification codes must not be stored after authorization, including for recurring payments. Follow the provider’s supported authentication flow.
When everything is in order, a button that says Buy waits for a press from the customer to consummate the transaction.
Why do these cost more than card-present transactions?
Card-not-present processing can carry different costs from card-present processing. A merchant processing fee is not automatically a surcharge paid by the customer; any separate surcharge must meet applicable law, card-network rules and provider requirements.
Fraud and chargeback responsibility depends on the transaction, authentication, network rules and agreement. Do not assume every fraud loss follows the same liability rule; ask your provider how its controls and dispute process apply.
Merchants and businesses have no choice but to arm themselves with fraud detection and prevention instruments to be able to validate and authenticate the cards that pass through their system. They wouldn’t want to miss out on sales for their products too, and online eCommerce is the most popular tool these days to make a sale.
CNP payments can help reach customers beyond a physical location. Supported countries, currencies, products and business models depend on the provider and merchant approval. Confirm those limits before offering a payment method.
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