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HOW CREDIT CARD PROCESSING WORKS

1. Customer Pays with Credit Card.
2. Merchant collects credit card information.
3. Upon approval by the card issuing bank the merchant account will be credited the transaction is submitted for settlement. 
5. Acquirer funds the merchant's account.
6. Issuer posts the transaction to customer's account.

BANK

4. Back end processor pays the acquirer and debits the card-issuer account; transaction is sent to the issuer.
7. Customer receives statement and pays the issuing bank.