A payment processor is piece of software that helps companies process their payments for goods or services sold. It helps move money from the buyer to the seller or from the payer to the payee.
Main aspects of a Payment processor.
Normally, there are several main aspects of a payment processor:
1. To check the amount of money required for a transaction.
2. To check the transaction amount and add the transaction fee.
3. To check if the drawee bank of the payer has sufficient funds in the payer's account.
4. To check if the card is valid.
5. To check if the drawee bank authorized that transaction.
6. Completion of the transaction request on the bank end.
7. Credit card company authorization.
Payment steps to be followed in a Payment gateway.
A payment processor, therefore consists of several steps and conditions that must be met before a transaction goes through.
That, which is used to transfer the payment is what is known as a payment processor.
Step 1: User enters Payee details.
Step 2. User enters amount to send.
Step 3. User hits to send funds.
Step 4. The Payment processor checks if user has sufficient funds in his or her wallet.
Step 5. If funds are enough, user will be allowed to send from balance, else, he or she will be allowed to fund his or her account using the allowed funding methods like mobile money, Credit card, bank or other integrated online payment methods.
Step 6. Finally the software will allow funds to be send.
There are several types of Payment processors:
1. POS (Point of sale) machines which you find in shops like super-markets.
2. Online payment processors like Paypal, payza, skrill, etc.
3. Mobile payment processors like Mpesa.