When you present your credit card as payment the merchant’s terminal will typically contact their transaction processor, which then contacts your card issuer to confirm that there is sufficient funds or credit to cover the purchase.
When the card issuer’s computer system approves the transaction, it creates an authorization on your account. This means that, while the money has not actually been paid to the merchant yet, your available credit is reduced by the amount of the authorization, so that the credit is set aside and cannot be spent at another merchant. Often the customer may not be aware of the amount of an estimated authorization, and may be surprised to find the available credit on the card is lower than expected.
When a purchase is made all details of that purchase are collected in a cetralized location and put into a settlement. PrismPay processes settlement records per industry guidelines and regulations to qualify your transactions for the lowest rate. Settlements can all be done automatically or manually. The entire process is entirely automated, including the printing of balance reports and bank deposit records.