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About "card swiped" and "key entered" credit card transactions (Merchant Service)

The Merchant Service for QuickBooks offers both "card swiped" and "key entered" credit card processing.

Card-swiped processing

For a card-swiped transaction, the merchant swipes the credit card through a terminal or other device that can read the data encoded on the card's magnetic stripe. The magnetic stripe data is transmitted to the credit card processor along with the transaction amount, which proves the card was physically present at the point of sale.

Card-swiped transactions typically qualify for a lower discount rate because they are less prone to data entry errors and carry a lower risk of credit card fraud.

You can sign up for card-swipe processing when you apply for the Merchant Service for QuickBooks. If you already have a QuickBooks merchant account, you can sign up to swipe credit cards at any time.

Key-entered processing

For a key-entered transaction, the credit card does not need to be physically present to authorize the transaction. Instead, the merchant enters the credit card information manually using a keypad or computer program, and the information is processed over the Internet (as with the Merchant Service for QuickBooks), over the phone, or by similar means.

When a merchant is unable to swipe a credit card (for example, if the card has a damaged magnetic stripe), the merchant can often handle the sale as a key-entered transaction.

This processing method gives you more flexibility (for example, you can accept credit card payments over the phone); however, using this method also means that you, as the user of the merchant account, have full responsibility for safeguarding against fraudulent transactions. To help reduce the risk of fraud, QuickBooks performs an address verification check for each key-entered transaction by comparing the customer address you enter with the credit card bank records.

Key-entered transactions are typically subject to a higher discount rate because they are more prone to data entry errors and carry a higher risk of credit card fraud.

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