A Guide to Back End Credit Card Processors

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    What are back-end credit card processors? Merchants need two types of credit card processing service providers: the front-end and back-end payment processor. The front-end processor sends transactions to the issuing bank for approval. Meanwhile, the back-end payment processor accepts the approved settlements from front-end processors, then transfers the funds to the acquiring bank.

    Back-end payment processors validate orders before administering the transfer. As such, merchants would benefit from partnering with a reliable processor that has total mastery over identity theft, chargeback, and fraud guidelines. Not sure where to start looking? Don't worry. We have multiple guides to finding the right online payment processor.


    Best Back End Credit Credit Processors in 2021

    1. Chase Merchant Services (CMS)

    • Next-day funding
    • Interchange-plus pricing plan available
    • Optional monthly fees
    • Owns WePay and Paymentech

    Chase Merchant Services, formerly known as Chase Paymentech, boasts a complete set of front-end and back-end credit card processing solutions through JP Morgan. As a direct processor, they can process any transaction in-house, from card to mobile payments. You might also know CMS as the credit card processor behind Square, another widely used credit card processing company.

    What sets CMS apart from other payment processors on the market are their flexible processing solutions. Clients have the freedom to elect their chosen pricing plan with their month-to-month billing. For example, you can start with interchange-plus pricing. Then once your business starts taking on more orders, you can upgrade to tiered pricing plans.

    2. Worldpay

    • Caters to international clients
    • Reliable 24/7 customer support
    • Competitive interchange-plus pricing structure
    • Extensive POS device lineup

    Worldpay stands as one of the most significant pioneers in the credit card processing industry. The company has been around since the early 90s. You might know them as the back-end payment processing service provider of Fattmerchant, a well-known high-volume credit card processor among small businesses.

    Since Worldpay's primarily a traditional credit card processing company, they generally outsource tech-related developments and tasks, such as their payment gateways and mobile transaction processing. However, they remain a reliable, reputable, go-to brand for top-notch direct front-end and back-end merchant services.

    Clients can also feel at ease knowing that the company focuses on customer support. In fact, thanks to their friendly, personable 24-hour customer service team, the company was able to keep the complaints down to a minimum, which is rare among processors serving millions of clients.

    3. Elavon

    • No early termination charges
    • Interchange-plus pricing option available
    • Wide range of POS devices

    If you want a trustworthy direct processor, try Elavon. They take pride in being one of the largest direct credit card processors in the country.

    In fact, Elavon caters to more than 1.3 million merchants globally, accepts payments in 100 different currencies, and processes more than $450 billion worth of transactions annually. Plus, they serve as the partner merchant bank and payment processor of HELCIM, another widely used processor.

    Another reason why clients trust Elavon is they are transparent and honest with their services—they deliver accordingly. Their commitment to customer satisfaction sets them apart from the disreputable processors that trick unsuspecting small business owners into signing up for seemingly good deals.

    Note: While the company has a three-year contract, business owners do not need to worry since the company does not charge early termination fees.

    4. FISERV

    • Customizable pricing plans
    • Extensive POS lineup
    • Multi-feature platforms and database

    FISERV is a massive credit card processing service provider that provides front-end and back-end payment processing solutions to more than six million business owners globally. Merchant One also trusts FISERV for the company's back-end transaction needs.

    Clients turn straight to FISERV for their direct processing needs because they offer an extensive POS system lineup. They have everything you need, from virtual terminals to mobile card readers. What's more, FISERV does not force clients to purchase the POS equipment but rather provides a lease option instead.

    Note, however, that may have to submit your application directly if you want to maximize the front-end and back-end features that FISERV offers. Resellers and third-party agents often muddle the company's terms and conditions.

    5. Global Payments, Inc.

    • Multi-feature POS devices
    • Supports international payments
    • Has good reputation

    Global Payments, Inc. has been providing front-end and back-end processing solutions since the 60s. They currently stand as one of the longest-running payment processors on the market.

    What makes Globaly Payments, Inc. stand out is its tenacity. Unlike other traditional financial institutions, the company goes above and beyond to develop new technologies and keep up with the latest trends. They don't simply outsource their services. This dedication to customer satisfaction is what helped them keep complaints to a minimum despite the large volume of clients they cater to.

    Processing Card has multiple resources to help startups and SMBs understand the concept behind payment processors. Check out our comprehensive guide to payment gateways and payment processors.

    Frequently Asked Questions

    How do I add credit card processing fees to an invoice?

    One way to charge customers credit card fees is by adding a line on the invoice with an item called "credit card surcharge" and calculating it at standard rates. If you have your system set up correctly, this can be done automatically without any manual effort.

    You can also ensure that credit card surcharges are processed smoothly by setting them as automated charges against each customer's account when they place their order.

    Can the IRS track credit card payments?

    As of 2011, businesses are required to report any income that comes from credit card or debit card transactions. The IRS has also partnered with banks and other financial institutions in order for them to provide information about your purchases back to the government agency.

    Can customers be charged extra for paying by credit card?

    New credit card legislation has been implemented to prevent retailers from charging their customers a fee for using their debit or credit cards.

    Can I process my own credit cards?

    Avoid processing your own credit card through a merchant account that you are affiliated with. You should also avoid paying someone else when it's not necessary because this can be considered fraudulent and money laundering—both of which are considered strictly prohibited by card companies.

    How do you get approved for a merchant account?

    To increase your merchant account eligibility, it is important to maintain a positive credit rating. Be honest about previous merchant accounts, bankruptcies, liens, or judgments. From there, take the time to compare and contrast different processors in order to find one that best suits your needs.

    What's the best payment processor for your business? Merchants have varying needs, and we strongly advise against blindly signing up for cookie-cutter processing plans. You need a payment processor that matches your business' specific processing needs.

    Although, we recommend narrowing down your options to direct processors that offer their own front-end and back-end solutions so you can efficiently and swiftly process transactions. Using third-party processors will only lead to higher fees and slower turnarounds. If possible, apply for commercial institutions that function as an acquiring bank account as well.

    Processing Card shares how accepting card payments can help businesses boost sales and expand their market. Check out our complete guide on partnering with online processors.

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