MOTO Credit Card Processing

MOTO is an acronym for Mail Order/Telephone Order and refers to credit card purchasing that is done neither in person nor through a website shopping cart. It applies both to the use of credit cards and debit cards. There are a variety of reasons for merchants to accept MOTO orders. Accepting MOTO may broaden the merchant’s customer base. It allows the merchant to accept orders from people without Internet access or during a period in which either the customer’s Internet is down or the merchant’s website is down or from people who order from a catalog or regular customers who can’t make it to the store or who just prefer to do things “the old-fashioned way.”

How MOTO Credit Card Processing Works

Merchant accounts can be specialized, focusing, for example, on retail credit card processing, online credit card processing, or MOTO credit card processing, while mobile merchants may have a wireless credit card processing account. For MOTO credit card processing, merchants who only accept cards in what are called “card-not-present” situations (i.e., exclusive MOTO businesses), can get that kind of account. If the merchant sometimes is in a situation in which a card is present, depending on the percentages of sale types, it may be advantageous to have both a card-not-present or keyed account and a card-present or swiped account, or to just have a swiping account with a terminal and key in occasional MOTO orders.

The customer calls in or mails in an order. It is advisable to merchants to ensure that they gather the following information, either by requiring it on a catalog order form or requesting it on the phone for new customers:

• the name of the cardholder as it appears on the card
• the billing address including street number and ZIP code
• the card number
• the security code, whether CVV or CVV2
• the card’s expiration date

A shipping address, if different, will also be required for products that ship. Returning phone customers should have their information re-verified in case of updates. MOTO orders are keyed through one of four systems: a POS (point-of-sale) system, a computer software application, a payment gateway, or a terminal.

Whichever processing system is used connects to the merchant account, which passes the sale data to the bank that issued the customer’s credit card. This bank checks the validity of the credit card, whether the amount of the sale is available for the customer, and whether anything about the transaction raises suspicions that would cause it to be denied (for example, a customer with a street address in Brooklyn making a purchase in a country on another continent, with no prior authorization). The bank sends authorization with an approval number or declines the transaction, and the message goes back through the system to the merchant.

Each day, the merchant’s account is “settled,” usually by an automatic action of the system. The profits are electronically deposited into the merchant’s bank account.

The customer’s credit card account is billed, and they see the charge within a month or so, depending on the point in the cycle at which the charge was made.

Sources

merchantwarehouse.com