Checking Whether a Credit Card is Valid

As a merchant, you generally want to check to see whether a credit card is good before you turn over services or merchandise.  This is especially important for online businesses.  Merchant card processing services can offer web-based software that integrates with your website back-end and is linked to your shopping cart and checkout options. This software differs from transaction approval software in that it first verifies that the card has not been listed as a ‘hot-card’ and is being used by fraudsters. Results are available within seconds, and if the card is authenticated the process will proceed to confirming whether the cardholder has available funds in the account to cover the transaction.

With most online purchases the business owner rarely sees the cardholder or the card. If you receive an order over the phone or by email, you would process the payment through the virtual terminal option made available by your merchant card service provider. Immediately entering the card details, even before packing the order will immediately inform you if the card payment is approved or declined. If it is declined you can advise the customer and take no further action on the order.

Avoiding charge-backs

As a merchant it is important that you maintain the integrity of you business with the merchant account service provider by keeping chargebacks to a minimum.

If you process a payment through the virtual terminal option and the card payment is declined but the customer insists that they do have adequate funds available, call your merchant card service provider. Explain the situation and give them all the card details as well as the value of the pending purchase. They will investigate the situation and report back to you.

By taking this step you can reduce the risk that your merchant card service provider will not validate a payment that will result in a chargeback.

Other options

If you process a payment through the virtual terminal and it is approved, but you still have suspicions, then it’s time to call the issuing bank directly.

Identify yourself as a merchant, and advise them of your suspicions. Provide them with the card number CVV number, name, address, email address and contact numbers provided by your customer. Confirm that every detail matches up with the rightful cardholder. If it does not, issuing banks have a fraud-line exactly for this reason. They will immediately call the valid cardholder and ask if they are trying to make a purchase from your business for the amount you have provided.

They will let you know whether all is well or not. And if not, you have just identified and prevented a fraudulent transaction!

If all is well, explain your actions and the delay in processing the order to your customer as a necessity to protect cardholders from falling victim to fraudsters. Your customer will most likely appreciate your vigilance.

For more information about verifying credit card payments or to sign up for a merchant account, please call (888) 924-2743 or go to

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