MOTO (CNP)
The rapid shift toward eCommerce has obscured the fact that other business models remain viable options. For instance, mail order and telephone order companies not only still exist, but are thriving in this digital age. However, like other businesses, you need a way to process credit cards, but that situation is complicated by the fact that these are “card not present” transactions.
Learn more about how National Processing can help you accept credit and debit cards within a mail order or telephone order business. Contact us today for more information.
What Are Card Not Present Transactions?
Today, credit and debit cards remain the most popular ways to pay for mid to high-value purchases. Cash has been relegated to low-value transactions, but even then, it’s impossible to accept cash payment over the phone and not advisable by mail. The rise in money order fraud and theft has also affected consumers’ ability to pay through the mail.
Processing card not present transactions allows you to accept payment for goods or services sold over the telephone or by mail. In this situation, the cardholder obviously cannot hand over their credit or debit card for processing, though, which creates complications.
Ready to start processing card not present transactions? Apply for your merchant account with National Processing today.
Types of CNP Transaction
Card not present transactions come in many different types. MOTO (mail order/telephone order) purchases are just one type. eCommerce purchases where the cardholder enters their information online and purchases remotely technically fall under this heading, as do mobile payments where the card may not be physically resent. Any purchase in which the card is stored in a digital wallet (such as a purchase with an Apple Card via the Apple Pay app).
The primary difference between these various transaction types is how the card information is provided to your business. With MOTO transactions, the information must be provided verbally over the phone, or in writing via mail.
Ready to start processing card not present transactions? We’ve got your MOTO business covered. Contact us today for more information or apply for your merchant account now.
How Are Card Not Present Transactions Processed?
In a conventional credit card transaction, a physical card is swiped through a physical terminal. With MOTO transactions, that cannot happen because the card is not physically present. However, the process is not all that different – merchants just use a virtual terminal instead of a physical terminal. The payment gateway processes the card details and the merchant services provider verifies funds and then transfers them to your merchant account.
What Are Virtual Terminals?
Virtual terminals take the place of physical POS components in the MOTO process and other card not present transactions. True to their name, virtual terminals operate in the digital world and allow vendors, service providers, and merchants to accept payments from anywhere, without the need for a physical card swipe. All that is required is for the merchant’s representative (either on the phone or the recipient of mailed card information) to enter the customer’s credit card information.
Contact National Processing today to learn more about our virtual terminal technology and payment processing services.
How Much Do Card Not Present Transactions Cost to Process?
Like all credit card transactions, CNP transactions come with a cost. You’ll be required to pay assessment fees, risk and PIC compliance fees, interchange fees, and any markup from your payment processing provider. At National Processing, we’re committed to complete transparency and affordable rates – we help ensure you have the predictability necessary to plan for business growth and never have to worry about high fees.
Learn more about our fees and how we ensure the most flexible, affordable payment processing solution on the market.
The Customer Must Have the Physical Card
While card not present transactions are quite common today, and virtual terminals have proliferated, the customer making the purchase is usually required to have the physical card in their possession. To verify this, merchants should require the three-digit security code on the back of the card.
This is a safety measure designed to help prevent unauthorized purchases made without the card and other fraudulent activities where someone may have the card number and the cardholder’s personal information, but lack the physical card (and thereby the security code on the reverse side).
Other Important Safety Precautions for Card Not Present Transactions
As a merchant, it is your responsibility to protect your customers’ financial information, including their credit card data. How do you live up to that responsibility?
PCI Compliance
Depending on your transaction volume, particularly MOTO and other card not present transactions, you will be assigned one of four levels of PCI compliance, with level 1 being the strictest and level 4 being the least strict. However, all levels have specific requirements in terms of storing, transmitting, and processing cardholder data.
The good news is that working with the right payment processor can alleviate your burden. For instance, at National Processing, we are level 1 PCI compliant and provide robust protection for all cardholder data, no matter what your transaction volume might be.
Address Verification
Another step in protecting cardholder information is verifying their physical address in conjunction with other safeguards, such as card security codes. An address verification system requires anyone using a card to verify their billing address. If the address entered is incorrect or incomplete, you’re notified and can take further action. Of course, many merchants lack the ability to integrate their own address verification system, but National Processing can work with you to provide enhanced protection for your customers and your business.
Isn’t it time you had a secure solution for card not present transactions? National Processing alleviates your PCI compliance burden and provides additional safeguards, while also delivering the powerful, flexible card processing platform you need. Contact us today to learn more or apply for your merchant account now.
