Card Not Present Transactions: What You Need to Know

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Card-not-present transactions are a form of payment where the cardholder is not physically present when completing the transaction. This payment type is popular with online retailers, including for high ticket business types.

Most card-not-present transactions are made on an online platform, which means that the buyer sends their credit card information to the retailer through a secure connection. This includes invoicing, keying in transactions, or taking payments from a website.                                    

What Is Card Not Present?

Card-not-present transactions are those that occur when the cardholder is not physically present when completing the transaction. This type of payment is a form of e-commerce where the transaction takes place on a platform online.

One example of a card-not-present transaction is purchasing something from an online retailer and using your credit card to pay for it. The retailer will likely ask for your credit card information through a secure connection. The information will then be stored in the seller’s databases and sent to the bank to process as a normal credit card transaction.

So what does this mean? It means that you don’t have to worry about someone looking over your shoulder while you’re typing in your credit card number or other sensitive data. Your data is safe with a secure connection!

Benefits of Card Not Present Transactions

Card-not-present transactions are popular because they can be done without the physical presence of the cardholder. This is great for buyers who want to make higher ticket purchases but are wary of giving their credit card information to a company, especially when they haven’t personally seen the product before.

Additionally, many retailers offer purchase protection for digital products. If you’re worried about losing your money if something goes wrong with your purchase, you might feel more confident in making your purchase through this type of payment.

The two main benefits of card-not-present transactions are security and peace of mind. It’s important that when making a larger transaction online, you don’t feel like your personal information is at risk. With these types of transactions, you can rest assured knowing that there isn’t any sensitive information being exchanged in person.

When Should You Use Card Not Present Transactions?

The card-not-present transaction method is popular among online retailers, especially for high ticket items. These transactions are made online, which means that the buyer sends their credit card information to the retailer through a secure connection.

It’s worth noting that this type of transaction is not without risks. There are typically higher fees associated with processing card-not-present transactions, and they are more likely to be fraudulent.

If you’re shopping for an item that will cost more than $5,000 or if you have reason to believe your customers are likely to use credit cards fraudulently, then card not present transactions might be a good option for you. However, it’s important to weigh the pros and cons before deciding whether this form of e-commerce is right for your business.

How to Make a Card Not Present Transaction

There are a few steps to take to complete a card, not present transaction.

First, the buyer will need to provide their credit card number, expiration date, and CVV number. The CVV number is the three or four-digit code on the back of most cards that prevent unauthorized purchases.

Secondly, the seller will need to verify that all of this information is correct before completing the transaction. This may be done by asking for the billing address or ZIP code, which will help verify that the card isn’t being used fraudulently.

Lastly, the seller will print out an order confirmation receipt after verification has been completed. This does not show what was purchased (only the buyer knows that), but it does contain information like transaction time and date and any errors made during purchase.

How to Accept Card Not Present Transactions

There are many reasons why a retailer might need to accept card-not-present transactions.

Many online retailers choose to offer cards not present transactions as an alternative payment option because they can’t take other forms of payment, like cash or checks. This is because it’s often difficult for online retailers to meet the necessary security standards and acquire the hardware needed for traditional credit card transactions.

Card-not-present transactions also allow you to sell items at a much higher price point than what is currently possible with traditional credit card sales, which has led to their popularity among online retailers.

However, there are some challenges associated with accepting these types of payments that an e-commerce merchant should be aware of before making this decision:

  • Risk: You may be subject to fraud by accepting these payments, so you will need to know how to protect your business from such risks.
  • Customer experience: It can be more difficult to process a card not present transaction than it would be with a traditional one because customers have less control over the process; it may also be more time consuming.
  • Chargebacks: When a customer realizes they’ve been charged for something they didn’t purchase, they can file a chargeback and receive their money back within 60 days.

Why Do Providers Offer This Option?

These are not the only form of payment that a business can offer. In fact, there are many reasons why a provider may offer card-not-present transactions to its customers.

Card providers offer this type of transaction for several reasons. The most common reason is that they want to give their customers more options for paying for their goods and services. It may also be because they want to make it easier for their customer base to purchase online, especially for high ticket items.

Some providers also offer cards not present transactions as a way of making it easier for their customers to make payments on the go, while others may include this option to provide peace of mind when shopping online.

Risks and Benefits

As with any form of e-commerce, card not present transactions are not without their risks. But these transactions also offer benefits that make them worth considering for many businesses.

The most obvious risk is the possibility of fraudulent purchases. When you use a credit card to purchase items on an online retailer, you provide your credit card information. If someone else gains access to that information, they can purchase your behalf.

This concern is addressed by some merchants who offer extra security measures for high ticket items like jewelry or electronics. For example, they might require a signature upon delivery or make it difficult for thieves to buy from them in general (e.g., asking buyers to call the merchant before completing the sale). However, as long as you take all necessary precautions and monitor your account regularly, this isn’t too much of a problem.


Card-not-present transactions are another way to make purchases. No longer limited to in-person transactions, a card not present is an option for consumers who want to buy online or over the phone. Businesses need to beware of the risks of cards, not present transactions. There are benefits, too. It is best to use a card, not current transactions, when appropriate for your business and customers.

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