Manual or Offline Credit Card Processing Transactions

For many brick and mortar businesses, it’s customary to use a swipe terminal where customers can physically swipe their credit cards and perform a transaction.  Merchants don’t always have the capability to process cards immediately, and this is especially true when they are presenting their business at trade shows or in locations outside of their store front businesses.  These types of transactions are called manual transactions, because the credit card information from the customer is not immediately processed through the merchant’s acquiring bank for approval.  Instead, the merchant manually enters in the card number for offline processing, and then batches all transactions out later on, usually at the end of the day.  This can be a little bit tedious, since most processing methods require the cardholder’s number, expiration date, name and phone number, address, and in some cases, their CVV2 number as well.

Another downside to manual or offline processing is that the merchant is not always sure the cardholder’s credit will go through.  If they are denied later on, the merchant may have already provided goods and services that they now might be unable to collect on.  The plus side of manual processing is that you are still able to take credit card payments even though the terminal is not readily available for real time processing.  This allows a larger window of business to flow in, and more customers will buy your items or pay for your services.  Since credit cards are becoming the number one method of payment in the United States, it’s important to be able to have this type of offline processing for credit cards readily available.  This type of offline processing can also save merchants payment gateway fees every month, particularly if they do not process exclusively online, or handle large quantities of transactions to cover the cost.