Online transactions
An online transaction is an electronic payment processed over the internet — from the impulse to buy in the webshop to the credit on the merchant account.
Online transactions
An online transaction covers the entire electronic payment process on the internet: from the buyer entering their payment data at checkout, through authorization by the issuer, to the payout to the merchant's account.
Technically, an online transaction goes through several stages: The buyer enters their payment details → the payment gateway encrypts and transmits the data → the acquirer forwards the authorization request to the card network → the issuer approves or declines → upon approval, the amount is reserved → during settlement, the amount is paid out to the merchant.
The security of online transactions is ensured by TLS encryption, 3D Secure, tokenization and PCI DSS. For you as a merchant, it is important to use a PCI DSS-compliant PSP and to never process or store sensitive card data on your own system.
Online transactions examples
A customer pays in an online shop using Visa. The transaction is authorised in under 3 seconds, and the merchant receives a confirmation.
A TWINT payment at online checkout: The customer scans a QR code, confirms in the app, and the payment is processed immediately.
A PSP bundles all online transactions of the day and transfers the total amount minus fees to the merchant account (settlement).
Online transactions FAQ
What is an online transaction?
An online transaction is an electronic payment over the Internet — from data entry in the checkout to the credit on the merchant account.
How secure are online transactions?
Online transactions are protected by TLS encryption, 3D Secure, tokenisation and PCI DSS. Sensitive card data is never transmitted or stored in clear text.
How long does an online transaction take?
Authorization takes 1–3 seconds. The payout (settlement) to the merchant takes place daily, weekly or monthly, depending on the PSP.
What is settlement in payment processing?
Settlement refers to the actual transfer of the transaction amount to the merchant. The PSP bundles the transactions and payouts the total amount minus fees to your merchant account.
