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To introduce Credit Card Payment, the credit card company must vetting business and industry. Generally, documents and applications are required according to the card brand being introduced, which takes time and effort, but by using a PSP company, it is possible to reduce these burdens.
In this column, we will explain Credit Card Payment that are essential for operating an e-commerce site, the content and period of the screening process, reasons for rejection, as well as the preparations that need to be made before the screening.
Contents
What is Credit Card Payment vetting?
vetting for Credit Card Payment involves credit card companies, acquirers, etc. investigating and assessing the creditworthiness of merchants when merchants introduces Credit Card Payment to its store or e-commerce site. An acquirer is an institution that obtains licenses from international credit card brands such as Visa and Mastercard, and develops, screens, and manages affiliated stores.
When Credit Card Payment, the credit card company temporarily pays the product cost on behalf of the user. Normally, the product cost is debited from the user's account, but there may be cases where a problem arises between merchants and the business for some reason. In that case, the transaction is canceled and the credit card company must collect the product cost that it paid on merchants. If the product cost cannot be collected, it will result in a loss for the credit card company.
To avoid such situations, credit card companies examine the business operations and repayment ability of merchants that wish to join.
*For more information on acquirers, please see the following article.
What is an acquirer? Explaining its structure and role | SB Payment Service
Items to check during credit card vetting
In the case of e-commerce sites, the following items are examined during credit card vetting:
Main contents of the EC site vetting
| E-commerce website | We will check the cart function and notation based on the Specified Commercial Transactions Act. If your e-commerce website is not yet complete, you can also submit documents that provide details and undergo review. |
|---|---|
| Products and services provided | Depending on the industry and product, you may not pass the screening. |
| Business performance | If you do not have experience operating an e-commerce site, we may conduct an evaluation based on in-store. |
The period required for credit card vetting
The review process generally takes about two weeks.
However, if there are any deficiencies in the required documents or website content, the review process may be prolonged. We recommend that merchants count back from the planned implementation date and allow plenty of time for the review.
Reasons why you may fail a credit card vetting
The standards for vetting required before introducing Credit Card Payment are set independently by each brand, and the details are not disclosed. Therefore, although it is only a guess, the following are possible reasons why vetting.
You are running a business that may be rejected
Depending on the merchants are running, you may be subject to strict screening. The following are some of the industries and occupations that may result in your application being rejected:
Industries and products that may be rejected
| Industry |
|
|---|---|
| merchandise |
|
Providing specific ongoing services
Specified continuing services are seven services designated by the Specified Commercial Transactions Act: "beauty salons," "cosmetic medical treatment," "language classes," "private tutors," "cram schools," "marriage partner introduction services," and "computer classes." What these services have in common is that they are services provided to help customers realize their goals, but they cannot guarantee that customers will achieve their goals.
These services have the characteristic that the effect varies depending on the customer and require high payments, so there is a higher possibility of trouble than other businesses. Therefore, there is a possibility that vetting will be rejected.
It may be against public order and morals
Article 90 of the Civil Code states that legal acts that have a purpose contrary to public order and morals are invalid, so businesses that violate public order and morals may also fail the credit card vetting. Businesses that violate public order and morals include acts of excessive profit (loan sharking), acts that violate ethics (concubine contracts), acts that violate justice (giving money on the condition that one does not commit evil), and acts that violate human rights (employment contracts that discriminate between men and women).
Individual business owners and small merchants with no track record
Not only small merchants, but also sole proprietors can have corporate credit cards. However, sole proprietors and small merchants with no track record may be rejected. If you have little business history, the credit information of the business owner will be given more weight.
There are problems with your credit
If your company has a credit history problem, you may not be approved for vetting. If you have been late with loan or credit card payments, or have filed for bankruptcy or voluntary debt restructuring, you should be careful.
What to prepare before vetting for a credit card
Here, we will explain what you should prepare in advance for vetting, based on the information currently known.
Prepare required documents
The required documents differ depending on the credit card brand and products handled, but the following documents are often requested by credit card companies.
• Seal certificate
• Qualification documents
• Permit (when handling products that require a permit)
• A copy of the registered copy
• Transfer account information
Preparation of cart function for EC site
You need to be able to browse the EC site, list the products for sale, and be ready to put the products in your shopping cart.
"Notation based on the Specified Commercial Transactions Law" posted
The following content must be posted on the EC site with a page called "Notation based on the Specified Commercial Transactions Law".
• EC operator name
• Location
• Contact information (phone number, email address, etc.)
• Selling price of goods
• Price other than the product price (payment method, decision fee, shipping fee, etc.)
• Payment time (prepayment, cash on delivery, deferred payment, etc.)
• Payment method
• Delivery time of products, etc.
• shipping method
• Return availability and conditions
• If the application has an expiration date, that expiration date
• If there is a hidden defect in the product, if there is a provision regarding the responsibility of the seller, the content
• If the transaction is related to software, the operating environment of the software
• If it is necessary to conclude a sales contract for a product more than once, that fact and the sales conditions
• If there are special sales conditions (service provision conditions) such as restrictions on the sales quantity of products, the details
• If the catalog etc. is sent separately by request and it is charged, the amount
• When sending commercial advertisements by e-mail, the e-mail address of the business operator
Obtain and post necessary permits and licenses
If there are any licenses or permits required for your business, obtain them and clearly display them on your e-commerce site. Some typical examples are as follows:
Examples of businesses that require licenses
| Type of business | ACTION NEEDED |
|---|---|
| Selling food products manufactured and processed in-house | Obtain a business license according to the type of food. |
| Selling alcoholic beverages on e-commerce sites | Apply to the tax office to obtain a mail order liquor retail license. |
| Selling used goods | Apply to the local police station to obtain a secondhand goods dealer license. |
| Cosmetics manufacturing | Apply to the prefectural pharmaceutical affairs department to obtain a cosmetics manufacturing and sales license. |
If you decide to introduce Credit Card Payment
There are two ways to implement Credit Card Payment: by contracting directly with a credit card company, or by contracting with PSP agency. The characteristics of each method are as follows. The steps from application to contract completion differ depending on the method.
Here, we will explain the benefits of using a PSP company for EC businesses.
<In the case of direct contract> Screening is required for each card brand
<When using a PSP agency> Bulk screening is possible
Benefits of using a PSP
PSP companies play a role in making contracts with credit card companies and managing sales payments on behalf of EC merchants. As shown in the diagram above, when making contracts directly with credit card companies, individual contracts are required. Therefore, the time required to prepare the documents required for screening and to communicate with each credit card company is required, which is very time-consuming.
However, by using a PSP agency, you can sign contracts with multiple credit card brands at once, greatly reducing the burden on merchants. There are also other benefits to using PSP agency. For more information, please refer to the article "What is PSP? A thorough explanation of the mechanism and benefits of PSP services."
How to choose a PSP
Each PSP company offers different services and features, so please compare and consider the company that is merchants before signing a contract.
Here are some points to consider when choosing a PSP company:
<Major points to check when choosing a PSP company>
• PSP agency service fees
• Types of payment methods accepted
• Security System
• System safety and flexibility
For more information, please refer to the article "How to Implement Credit Card Payment Agency Services and Comparison Points."
Why SB Payment Service is chosen
We obtained international brand licenses for Visa and MasterCard in 2011, and for UnionPay in 2015. As an "acquirer," we conduct comprehensive vetting for merchants and other PSP merchants.
We can provide a one-stop service from screening to providing payment services, so we can flexibly support the development of new businesses, including payments.
As mentioned above, our service provides many benefits to merchants.
If you are an e-commerce merchants considering the introduction of Credit Card Payment, please contact us.
FAQ
- Q.
- What is credit card vetting?
- A.
- vetting for Credit Card Payment involves credit card companies, acquirers, etc. investigating and assessing the creditworthiness of merchants when merchants introduces Credit Card Payment to its store or e-commerce site.
In order to avoid losses to credit card companies, we examine the business operations and repayment ability of merchants that wish to join.
- Q.
- What is the process for vetting?
- A.
- In the case of an EC site, the credit card vetting will examine the status of the EC site, the products and services offered, and the business performance. If the EC site is not yet complete, you can submit documents that can confirm the details and undergo the review.
- Q.
- What are the reasons for failing a credit card vetting?
- A.
- Possible reasons for failing a credit card vetting include a lack of business track record or problems with credit information. In addition, if you provide specific ongoing services, are against public order and morals, or are engaged in a business that the credit card company considers high risk, you may fail the screening. Specific ongoing services are seven services designated by the Specified Commercial Transactions Act: "beauty salons," "cosmetic medical care," "language classes," "private tutors," "cram schools," "marriage introduction services," and "computer classes."
If you have any other questions, please check the FAQ.
