Credit card payment processing takes place in two phases: authorization (getting approval for the transaction that's stored with the order) and settlement (processing the sale, which transfers the funds from the issuing bank to the merchant's account).

Authorization

FDMS Nashville compatible merchant accounts

1. When the buyer (cardholder) clicks Checkout, he/she is sent to secure servers to complete the checkout process. The buyer places an order at the merchant's site by clicking Send Order on the Review Order page during checkout.
2. Turbify sends the authorization request to First Data Merchant Services (FDMS), the payment processor.
3. FDMS sends the authorization request to the issuing bank (or credit card association). The authorization request includes:
   • the credit card number
   • the expiration date
   • the billing address (used for AVS validation)
   • the CVV number (if entered)
   • the amount of the order
   The issuing bank:
   • validates the card number and expiration
   • checks the amount of the order against the available credit
   • checks the billing address provided against the billing address on file
   • validates the CVV number (if provided)
   If approved, the amount of the order is reserved from the total of available credit for the cardholder.
4. The issuing bank sends the authorization response to FDMS. The authorization response consists of either an approval along with Address Verification System (AVS) and Card Verification Value (CVV) response codes, or a decline.
5. FDMS adds response codes to the authorization response and passes the authorization back to your store. If the merchant has enabled Risk Tools, the rules set by the merchant will be run when the response is received from FDMS. The authorization, if approved, is stored on secure servers for later processing by the merchant.
6. Depending on the state of the authorization, the buyer receives instructions or confirmation of the order:
   • If declined, the buyer is informed and asked to try a different payment method.
   • If the authorization is approved by the issuing bank, and then the buyer is taken to the Order Confirmation page.

Settlement

PayPal (separate authorization and capture)

1. The merchant signs in to his/her account and goes to the Order Manager. The merchant reviews the order (including AVS and CVV response codes) for signs of fraud. When ready to complete the sale, the merchant clicks Capture Funds in the transaction panel of the order. Clicking Capture Funds initiates the settlement process.
2. The amount captured is transferred immediately to the merchant's PayPal account.

Note: It's also possible to set your PayPal Payments Pro service to authorize and capture funds immediately without review. Turbify doesn't recommend this process, as it doesn't allow you time to review orders for any issues before settlement.

Braintree (separate authorization and capture)

Braintree works in a similar fashion as PayPal.

1. The merchant signs in to his/her account and goes to the Order Manager. The merchant reviews the order (including AVS and CVV response codes) for signs of fraud. When ready to complete the sale, the merchant clicks Sale in the transaction panel of the order. Clicking Sale initiates the settlement process.
2. The amount captured is transferred immediately to the merchant's bank account.

Note: With Braintree, it's also possible to set your service to authorize and process the sale immediately without review. Again, Turbify doesn't recommend this process, as it doesn't allow you time to review orders for any issues before settlement.

FDMS Nashville compatible merchant accounts (separate authorization and capture)

1. The merchant signs in to his/her account and goes to the Order Manager. The merchant reviews the order (including AVS and CVV response codes) for signs of fraud. When ready to complete the sale, the merchant clicks Sale in the transaction panel of the order. Clicking Sale initiates the settlement process.
2. The amount captured is transferred immediately to the merchant's bank account.

See Also:

• Payment processing glossary
• Apply for online credit card processing
• Set up online payment processing through FDMS
• Process credit card orders online
• Process credit card orders offline