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Payment Processing Terms you Need to Know: MOTO

When you’re selling high-risk products online, like supplements or mastermind coaching, there are a few core terms you should know about. If you’re new to the high-risk e-commerce environment you might not be sure what type of processing you need, or what you should be looking for. This is why we’re covering Mail-Order/Telephone-Order, commonly referred to as MOTO. Covering the basics is important in order to get a wider grasp of what things are, how they work together, and what solutions or services are best for your business. It’s one of the reasons why we often discuss various high-risk credit card processing terms, codes, or industry and business terms.

At E-Commerce 4 IM, we work to help high-risk business owners successfully run their companies. Part of how we achieve this is by offering various high-risk merchant services. For example, we offer merchant account set-up assistance, chargeback mitigation, and credit card processing to many different high-risk businesses. Another important part of what we do is providing expert insights, how-to’s, and covering basic high-risk business terms on our blog. One of the more important terms to know for high-risk e-commerce is arguably “MOTO” – which we’ll discuss here.

MOTO transactions defined

MOTO is an acronym for Mail-Order/Telephone-Order, and it’s what’s known as a Card Not Present (CPN) transaction. MOTO is a transaction type that occurs when a business accepts credit card payments over the phone or through the mail. The merchant is provided with the credit card details, and they enter the customers’ information into the payment gateway or payment system the business use to process the transaction. While mail-order is becoming a little outdated, processing credit card payments over the phone is still very commonplace.

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Difference between MOTO and e-commerce transactions

When starting your high-risk e-commerce business, it’s important to establish how you want to accept credit card payments. For most new business owners these days, e-commerce and processing credit cards through their website is the obvious choice. However, being able to offer an alternative for your customers can be very useful. This is where Mail-Order/Telephone-Order transactions can come in handy.

You might ask yourself what the difference is – both transaction types happen when the customer isn’t physically at a store. In other words, aren’t both methods a transaction type in which the processing happens where the Card’s Not Present (CNP)?

Card Not Present transactions

When you think about Card Not Present transactions and MOTO, it’s a similar situation to jacuzzis and hot tubs. Not all hot tubs are jacuzzis, but all jacuzzis are hot tubs. The same goes for CNPs. All MOTO credit card processing is a CNP, but not all CNPs are MOTO.

The biggest difference between MOTO and e-commerce transactions can be explained by how the card details are entered during a CNP transaction.

When you, the business owner and merchant, enter the customer’s credit card details then the processing is a MOTO transaction. On the other hand, when the customer enters their credit card information on your website, it’s not a MOTO transaction. However, both transaction types are a Card Not Present transaction.

Should you offer MOTO as a payment alternative?

Whether to offer MOTO payments to your customers or not is a great question. These days, convenience is essential for landing leads and completing sales. Most customers expect to be able to pay for products and services whenever and however they want. However, whether it’s a good idea for you is difficult for us to determine without you getting in touch with us to discuss your needs. If you’d like to give us a call about your processing needs, we’ll be able to help you start accepting credit cards successfully. You can reach us here.

For now though, the best way to try to address this question is to go through some pros and cons.

Pros for high-risk businesses

Customers don’t want a difficult or time-consuming experience when trying to pay for a product or service. MOTO is an excellent payment method in this regard. It’s very straightforward, as payments clear quickly and effectively once the customer provides you with their credit card details.

It’s a very convenient payment method, as customers won’t need to show up at a physical location to complete a purchase.

Cons for high-risk businesses

Similar to other e-commerce and CNP transactions, MOTO payments come with some inherent risk. Unlike credit card purchases made in-store, it’s your merchant account issuer (the acquiring bank) that guarantees CNP transactions – not the credit card issuer (the issuing bank). This makes the transaction more risky for high-risk merchants themselves, as potential issues like fraud can be problematic and result in chargebacks.

However, with the right chargeback mitigation systems in place, you’ll be able to effectively manage that risk. Having the right high-risk credit card processing in place can alleviate some of the stress points you might experience when taking CNP credit card payments.

Need to accept MOTO and other high-risk CNP payments?

Processing high-risk payments online and over the phone doesn’t need to be difficult. Simply contact us today and we’ll help you accept credit card payments successfully and securely. You can reach us here or give us a call at 1 800 570 1347. After all, we specialize in providing high-risk credit card processing and merchant services for many different high-risk businesses. We’re ready to recommend high-risk merchant accounts and offer excellent chargeback mitigation programs when you need it. Contact us today and you’ll be processing MOTO and CNP payments in no time.

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