If you have a winning product, using offline processing with forms will often fall part as the processing time for each transaction becomes too great a proportion of the overall cost.
The main decision to be made when choosing how to automate credit transactions is whether to hand the processing over to third-party companies or service bureaus that specialize in selling software.
The advantage of outsourcing is that it doesnít require a merchant account. A third party takes care of the authorization and settlement phases, as shown in Figures 1 and 2.
There are several types of services available (see Table 2). Kagi Software has grown out of a system for collecting money from shareware registrations. Itís perfect for small shareware-type applications and doesnít even require an SSL connection. However, itís not the prettiest of forms, and the whole scheme is rather inflexible. There are approximately a thousand vendors using the service to sell software, consultancy, and even lecture notes. Kagiís system is also particularly useful for international vendors who donít want to deal with multiple currencies. RegNet is another company offering a similar service aimed at shareware registration.
VanServ is a joint collaboration between Vantage Technologies and WebAgency. Like Kagi and RegNet it offers an alternative for international vendors or those with no credit history who canít get U.S. merchant accounts. This system is aimed at full-blown catalog shops and comes complete with its own shopping-cart software. Vantage also offers merchant accounts.
Each of these companies lets you use its Web server to host all your transactions. What youíre really paying for is a secure form and the credit-card processing behind it. Neither RegNet nor Kagi is flexible enough to let you seamlessly integrate the host site into your design for that all-important professional look. Other things to watch out for are long delays in getting paid, which can range anywhere from 30 to 90 days, so that any credit-card problems or fraud can be dealt with before your payment is sent. Vantage also holds 10 percent every month as a security deposit. When asked about the withheld funds, Phil Doyle of WebAgency says, "Banks require a deposit in advance and it can be substantial. Vantage lets you build a deposit as you go, per transaction. The money is yours and is returned if you cancel the account." --GN