How to Avoid Chargebacks

Chargebacks can cause a great deal of trouble for a business, especially when merchant accounts initiate fees for them. Credit card processing has a wealth of benefits, but it also has complications such as consumer chargebacks. Consumers initiate chargebacks for a wide variety of reasons including fraud, attempted theft, honest mistakes and discontent. Every business […]

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Building Your Small Business

Accepting credit cards is a necessity for small businesses because it allows them to remain competitive, offer convenient payment methods to buyers and not forego a sale in the event customers come up short of cash. Understanding the world of credit card processing can seem daunting at first, but these 3 key principles help address […]

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Reading Reviews Before Selecting Your Merchant Account Provider

When looking to select a company to use as a credit card processor, it’s wise to choose one that offers all the right services at a good price. However, one should take it further, and here are three things to look at when reading reviews for a merchant services provider. Speed: Without a doubt, if […]

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All About Flagship Merchant Services

Flagship Merchant Services has been helping merchants conduct transactions online for many years. As a leader in credit card processing and merchant accounts services, Flagship Merchant Services has remained focused on giving business owners of all size the solutions they need to effectively do business completely online. How does credit card processing work? There are […]

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All About

Without a doubt, when looking to get credit cards processed, one should go with a solid, reliable and trustworthy company. When doing so, it’s easy to avoid mistakes that others suffer from. While true, one should know where to look, and is a great place to go, and here are three reasons why. Provide […]

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What is the Bankruptcy Notification Service?

Without a service, it’s hard for people to know when someone went bankrupt, and this is often a problem when dealing with merchant accounts or other financial services. For this reason, the two major worldwide credit card companies, Visa and MasterCard, have developed a service to help people track bankruptcies. With this, people can see […]

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An Automated Response Unit (or ARU) allows merchants to accept credit card payments without actually having the card. The person taking the order enters the credit card details manually, and the Automated Response Unit uses a phone line to contact the bank’s system for authorization. The bank’s system then either authorizes or denies the charge, and sends this information back to the ARU. This may sound like a long, complicated process, but it actually takes only a second or two.

Websites do not use an ARU. Instead, they use the Internet to send the customer’s credit card information to the bank. While the information is sent in a different manner, the process is much the same. The merchant receives the payment info, sends it to the bank, and waits for an answer as to whether the transaction is approved or denied. The bank sends this information, and the merchant either processes the transaction or returns a denial message to the customer.

While ARUs may sound antiquated, they are used more widely than one might think. Most orders made over the phone will be taken by a person ready to enter information into an ARU. An order of pizza for delivery or a bouquet of flowers sent to a loved one was most likely processed using an ARU. The technology may have been around for decades, but it is still a vital part of credit card processing for many merchant accounts.

The predecessor of ARU technology was carbon copying. The card used for payment had to actually be in the cashier’s hands at the time of the transaction, and it was swiped through a plastic slot lined with carbon copy paper. This was unreliable, as the paper sometimes would not make a good enough imprint of the card information for the bank to process the transaction. Also, every carbon copy had to be manually dropped off at the bank at the end of every business day, which cost businesses time and money. Compared to this ordeal, the use of ARUs seems futuristic.

There, is however, a decline in the use of ARU technology. While it remains the method of choice for orders taken over the phone, many customers are placing orders online instead. Such ARU stalwarts as pizza and flower delivery now have websites that customers can use to place their orders.