Web Hosting Talk : Web Hosting Main Forums : Ecommerce Hosting & Discussion : how e-commerce works?

[feelexit]

I am a web developer, and need to build a e-commerce web site, selling some stuff online.

Shopping cart is pretty easy, there are so many out there, I can just pick one.

my questions is , after users shopped online and check out, how am i gonna charge them.

I know i need a merchant account, after u get a merchant account ,do they provide u the codes, and u can integrate into ur web site.
or u have to write your own billing system???

please explain to me how the billing system works?

appreciate your help.

[cdgcommerce]

Hi Feelexit,

The answer to your question largely depends upon which merchant account provider you decide to work with.

Typically, most merchant account providers set you up with a payment gateway along with a merchant account.

The payment gateway - whether it is Authorize.Net or another service - is the online system that actually "links into" your shopping cart.

The payment gateway is a conduit for data and the Internet equivalent of those "card swipe terminals" you see at your local retail stores.

Most payment gateways also include 24x7 reporting features and a "virtual terminal" feature which allows manual sales to be run by the merchant at any time.

If you are using an off-the-shelf shopping cart, configuring in the gateway is often as easy as just specifying your gateway username and you are set in a matter of seconds.

If you are building a custom cart or e-commerce application, then you will need to integrate via the API instructions that are provided by the payment gateway system in question.

So here is how the entire process would work:

1. Customer goes to your Web site and puts items into their shopping cart.

2. Customer checks out to buy the products in the cart and fills out a secure payment page either on the merchant's site (via SSL cert) or on the payment gateway side.

3. The payment gateway takes the secure payment details and transmits it through the merchant account's "front-end network" where an authorization is done. If approved, an auth code is sent back along with the approval message and that amount of money is temporarily removed from the cardholder's credit line.

4. Lastly, on an automated basis each night, the payment gateway does a "batch settlement" which collects all of the auth codes obtained from that day's sales and settles them through the merchant account's "back-end settlement network."

5. Once this happens, the credit line is permanently removed from the cardholder and the acquiring/merchant bank receives funds from the issuing bank for the sale.

6. These funds are then subsequently deposited into the local bank account of the merchant by the acquiring bank.

As you can see, there are a lot of steps but the good news is that it is all handled very quickly and all automatically - tens of millions of times a day.

My suggestion to you is to definitely select a merchant account processor that provides extensive, in-house tech support. This way, you can get the answers that you need on your integration questions all from one source as opposed to having to bounce from one provider to another provider.

Hope this info is helpful!

[feelexit]

thank you so much, i got it now. this info is so helpful. by the way, i take a look of your web site. do i have to become a client first to get the api instruction. or i can take a look rite now.

[cdgcommerce]

Glad that info was helpful!

I will PM you directly on your other question.

[Corey Bryant]

cdgcommerce is correct. It is very easy these days to configure a shoping cart to speak directly to a gateway. What most people do not realize though - there are two companies, the gateway & the processor.

Authorizenet.com markets their gateway. Most everyone else markets the processor. There are some gateways that are very easy to send information over to - you just create the form & the gateway handles the rest

You do not want to capture CC data on a non-secure website. If you do not have SSL, make sure that you get to the secure gateway though before requesting this information.

[feelexit]

cdgcommerce, thank you. i got your PM and ll take a look of your web site.

thank you, coreybryant, I think i finallygot an idea how to build an ecommerce web site now.

[Optimal]

These websites explain this subject as well:

http://www.ourshop.com/resources/int...-accounts.html

http://100best-merchant-accounts.com...ounts-work.php

Please note that they contain advertisements and want you to use their services, however the information presented is still valuable.