Payment Processing: Batch vs. Real Time

* Can you use both? You may find that, in many cases, hybrid authorization systems that employ the best of batch and real time can create the optimal cost and operational environment. Using a system of rules that takes into account your unique business and approach to customer service can save you both time and money.

For example, some catalogers opt to use real time for first contact with new customers. But once a customer is established, the need and expense spent on real-time authorization diminishes.

* Will your volume of transactions create economies of scale? Some merchants produce enough transaction volume to justify conducting all of their business in real time. The more transactions processed, the more their costs decrease. For these large-sized companies, mega volume translates into lower per-transaction costs without the cost in upkeep or administration of two authorization systems.

* What should you ask your payment processor? Your payment processor should act as your consultant and guide in steering you through the myriad questions associated with choosing an authorization system. If you’re not getting answers to your questions, it may be a red flag that your processor isn’t equipped to provide the full spectrum of authorization solutions.

Theodore Osuniga is a senior manager in national sales at First National Merchant Solutions, an Omaha, Neb.-based credit card processing provider. Prior to his last two years in the credit card industry, he spent 15 years in national sales for IBM. He wrote this article at the request of the Catalog Success editors. He can be reached at (402) 636-6834 or via e-mail at tosuniga@fnni.com.