Consider the concept of acquiring – what it is, what benefits it brings, how it functions and how to organize it at home.
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What is acquiring?
This term refers to the technology of payment for services / goods using bank cards. There are two types of such non-cash transactions:
- through terminals (merchant acquiring);
- via the Internet, using a special web-interface (Internet acquiring).
Consider the entities (individuals and legal entities) involved in the acquiring process:
- Client – an individual or legal entity making payment.
- The issuing bank is the institution that issued this bank card. Responsible for all operations of replenishment and withdrawal of funds from it.
- Point of sale – a legal entity that receives money for its services / goods by bank transfer. Organizes acquiring at home. Pays for its use a certain amount.
- Acquiring Bank – a bank that provides the seller with acquiring services. The seller must have a checking account in it.
For work, this technology involves the use of:
- POS-terminals (stationary or mobile);
- special secure software (if cashless payments are made via the Internet).
Benefits of Acquiring
We consider separately for each of the actors of the above chain.
Increased payment options for goods / services. Moreover, a bank card over cash has a number of undeniable advantages. The most important thing is safety. Her loss (due to personal carelessness or theft) does not lead to a loss of money. Plus convenience – to have a card on which there can be an arbitrarily large amount, much more comfortable than an equivalent amount of cash.
Speed of service. The seller does not have to waste time to give change. No need to look for little things to make it more convenient to pay.
Increasing attractiveness in the eyes of the client. Now the global trend is the transition to cashless payments. Many people already carry little cash with them. Lack of merchant acquiring at the seller automatically deprives him of such customers.
Cost reduction. For cash it is necessary to provide security, for their collection (transportation of money to the bank) you must pay.
Increase in average purchase receipt. It has long been noticed that a person is easier to part with money that he does not see. Secondly, the presence of a bank card allows you to use credit funds.
For issuing and acquiring banks:
- Receiving a commission from a point of sale for services provided
- Working capital increase.
- Increase Recognition.
It is necessary to say about the shortcomings
There is a danger of unauthorized access to money using various hacker software. But, as world practice shows, subject to scrupulous implementation of all safety rules, such a danger is practically eliminated.
Some trading organizations do not like such electronic cashless payments because they show all their profits to the tax authorities. Accordingly, it is necessary to pay taxes in full. But the global trend is the transition to cashless payments. Therefore, it is better to participate in this process and take advantage of it.
How does acquiring work?
First, you need to organize it at home. For this, it is necessary to conclude an acquiring agreement with one of the banks that provides such a service. According to him, he leases / sells outlets the necessary equipment and software (POS-terminals, programs) and provides a package of services, including:
- Software installation and hardware setup.
- Provision of necessary supplies (if necessary, for example, paper for checks).
- 24/7 technical support and technical information support.
- Directly the process of non-cash payment occurs as follows (consider the example of merchant acquiring).
The seller enters the necessary information into the terminal – the name of the product, its quantity, price. Inserts / attaches a client card to it (the client enters a PIN code if necessary).
The terminal sends information to the acquirer bank, where it is processed and verified with a “stop list” – there are restrictions on the card, its blocking, etc. If there are no restrictions, the purchase information is transmitted to the card issuing bank.
It authorizes the card, checks the amount of money in the account, the presence of restrictions and locks. If the bank does not see any violations and the amount in the account is enough to make a purchase, it sends a positive response to the acquiring bank. He finally authorizes the purchase. The terminal displays the inscription: “Operation successful” or similar.
The whole process takes a few seconds. But the process of transferring money from the issuing bank to the acquiring bank may take several days.
How much is acquiring?
The buyer (client) pays nothing for him. For him, the product / service costs the same, he pays in cash or by card. The trading organization pays the acquirer bank 2-3% of the amount of each acquiring operation. This commission consists of:
Commissions of the acquiring bank. It is set by the bank itself and may be 0.5% -2%.
Commission of the issuing bank. It depends on:
- The security level of the transaction. The higher it is, the less payments. Safety depends on the hardware and software used.
- The mutual arrangement of banks participating in the operation. In one state or not.
- Type of seller. Grocery stores have less commission. This is due to the fact that return of goods is possible. And this means a refund and the cost of it. Products rarely return. But the return of a 180-centimeter “plasma” will require sending a significant amount to the buyer.
- Type of bank card. The more status it has (Gold, Platinum, etc.), the higher the commission.
Commission payment system (Visa, MasterCard, etc.). It does not exceed 0.5% and depends on the number of operations for a certain period. The larger and the lower the percentage.
How to connect acquiring
First you need to choose a bank that will provide this service. Criterias of choice:
- The type and cost of the necessary equipment and software. Terms of purchase or rental.
- Proposed financial terms.
- Terms of service and support.
Having decided on the bank, you must send an application to it. A bank representative will contact you, who will tell you in detail about the connection procedure, and answer questions of interest. If everything suits you, you conclude an acquiring agreement, according to which the bank installs and sets up equipment, trains your staff. After that, you can start accepting non-cash payments.