Credit Card Processing Guide

The Ultimate Guide for Small Business Owners on Payment Processing and Merchant Services


Credit card processing is a basic need for almost every business today and no matter what you read there is no way to avoid the costs associated with payment processing. The more informed you are about picking your payments partner, the better off you and your business will be.

As a business owner, how do you select a merchant service provider that won’t make accepting credit cards cost prohibitive, but will also be available to help when you need it most? We are going to cover everything you need to know about credit card processing — we’ll help you get the most bang for your buck.

Five Frequently Asked Questions About Accepting Payments

We understand that accepting payments as a small business owner can be tricky, especially credit card and debit card payments. Here are five questions we get asked regularly about credit card processing from small business owners.

1. How do I accept credit card payments?

To accept credit card payments, also known as credit card processing, you need to get set up with a merchant ID from a merchant service provider like TransNational Payments. Next you will need to determine what method of accepting payments works best for your business, such as a point-of-sale system (POS), credit card terminal(s) or mobile payments.

2. How fast are sales deposited?

Typically, the deposit schedule is fast — usually within 24-36 hours of the transaction or in one to two business days, however you want to look at it.

3. What are chargebacks?

Chargebacks happen when customers dispute a charge from your business with their card-issuing bank. When a chargeback occurs, the funds in dispute are held from the merchant while the issues is being resolved.

4. How can I accept EMV chip cards?

EMV chip cards are processed differently than the typical magstripe cards. That said, you need an EMV-enabled reader to accept EMV chip card payments. While this might seem like a hassle, EMV chip cards are much more secure than magstripe cards, often saving your business time and money in the long run.

5. How can I accept mobile payments?

To accept mobile payments like Apple Pay, Android Pay and Samsung Pay, you need a payments reader equipped with NFC (near field communication). To use a mobile payments app for your credit card processing, we recommend working with a merchant services provider, such as TransNational Payments, who can help set up your business with mobile payment processing.

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Why Small Business Owners Should Accept Credit Cards

If your business does not accept credit cards today, it is quite possible you are missing out on sales. Customers are carrying cash less and less and tend to value the quick and simple payment process of using credit cards. Below we have listed some of the more common reasons why it makes sense for business to accept credit cards:

Cash Flow Improvement

Credit card transactions are usually deposited within a few business days, while checks can take much longer to clear.

Customer Attraction

Your customers want convenience and a simple experience. If you accept credit cards, your customers will have the best experience possible, which could lead to repeat business and referrals.

Increased Sales

Yes, it is true, customers tend to spend 12-18% more when they pay with a credit card.

Streamlined Operations

Payments technology can help you operate more efficiently. Take for example our mobile payments app, payment gateway or our merchant portal — all have robust reporting and integration features.

Accepting EMV Chip Cards

What is EMV?

EMV is a new payments technology that upgrades traditional magnetic strip cards and processing, vastly improving security to eliminate risks of counterfeit and lost/stolen fraud.EMV stands for “Europay, MasterCard, & Visa” – the technology’s developers.

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How Does Credit Card Processing Work?

Before we jump into how credit card processing works, let’s take a look at who is involved in a credit card transaction.

Cardholder (aka customer)

The consumer who is using a credit card to make a purchase.


The business accepting credit card payments from the cardholder in return for their goods or services.

Credit Card Networks

A network of issuing banks and acquiring banks that process the payment cards of a specific brand. These brands include: Visa, MasterCard, Discover, American Express and others. In addition to providing the backbone for processing the transactions, the card brands serve as the governing body of financial institutions that issue credit cards.

Acquiring Bank

The bank that processes and settles a merchant’s credit and debit card transactions, also known as the merchant bank.

Payment Processor

The entity that manages the transaction process for merchants (think TransNational Payments). Some processors also provide the necessary card reader equipment, as well as customer support and other value-added services.

Issuing Bank

The cardholder’s bank, which is responsible for remitting funds from the cardholder’s account to the acquiring bank for the approved transactions.

The Process:


When a cardholder, your customer, makes a purchase, the merchant’s payment solution sends the credit card transaction data for approval to the acquiring bank/payment processor who then sends that data to the credit card network.

The credit card network requests payment approval from the issuing bank, who reviews the credit card transaction data to make sure the card has not been reported stolen or lost, and that the cardholder has sufficient credit. The issuing bank then lets the credit card network know if the transaction is approved or declined.

The credit card network then communicates that information to the acquiring bank/payment processor who in turn lets the merchant know if the transaction has been approved. This entire process happens in just seconds!


The issuing bank sends funds in the amount of the sale, less their fee, back through the acquiring bank/payment processor, who forwards the funds, less their fee, to the merchant’s bank account.

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Credit Card Processing: A Look Into the Costs

As a merchant you typically only have to directly pay one entity, your processor, who collects the fees and pays both the card networks and brands on your behalf. Payment processing fees are really a combination of three charges.


Interchange fees go directly to the card processing network. Interchange is set by the card networks and isn’t negotiated between the processor and merchant, small and medium-sized businesses don’t need to worry about getting a fair deal when it comes to interchange.


Assessment fees go directly to the card brands.

Processor Value-Add Fees

Processor fees go directly to your merchant services processor, such as TransNational Payments. Credit card processors collect and pay the interchange fees to the card network but they have their own value enhancements and operating costs to cover, so they charge additional fees on top of interchange. TransNational Payments’ value, in addition to the basic payment authorization function, includes: allowing you to accept a broad variety of payment types, providing best-in-class payment security technologies, helping you expand to additional locations and being available 24/7 for in-depth customer support. We also offer additional services in the form of reporting, gift and loyalty programs and ACH services that go well beyond basic transaction services.

Free Rate Review

If you already have a credit card processing account, great, we can use your current credit card processing statement to get a good comparison. If not, no worries, we can help you establish a credit card processing account.

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Tips to Help You Get Set up for Credit Card Processing

Need to accept credit cards? Here are some tips to help make the process go as smooth as possible, and even end in a good partnership:

1. Check out reviews on a reputable site, such as Google Reviews.

2. If you have a current credit card processing account, have your statement and other business information ready.

3. Have a general idea of what type of value-added services might be useful to you and your business.

4. Return your application quickly, fully completed and signed.


Merchant Services

Merchant services goes beyond credit card processing and debit card processing. Merchant services includes credit and debit card processing, gift and loyalty programspoint-of-sale systemsfraud prevention, mobile payments, reporting tools and security tools.

Ultimately, merchant service providers support you, the merchant, by providing you the tools and support you need to operate your business.

Make the Move to the Best Credit Card Processing Company


TransNational Payments
9550 W. Higgins Road • 8th Floor • Rosemont, IL 60018
Tel: 888.998.6224 

TransNational Payments is a registered ISO of BMO Harris Bank NA and Wells Fargo Bank N.A.,
Walnut Creek, CA