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Payment Processors and the Data Journey

Have you ever wondered what journey consumer banking and payment information takes on its way to ‘approved’ or ‘order confirmed’?

The total number of payments made by consumers last year fell by 13% in comparison to previous years. However, payments made by smart phones and other digital devices increased*.

Contactless technology payments make up for a growing proportion of transactions, says the banking trade body UK Finance. During the pandemic 9/10 people shopped online and the contactless limit was increased quickly from £30 to £45 to reflect this growth. There was a further jump to £100 on the 15th October 2021.

This highlights the importance of reviewing the fundamentals of your network architecture, to stay ahead.

Where does an Internet Exchange Point (IXP) like LINX become a point of interest on this journey to help make things more controlled whilst continuing to maintain network security?

Embarking on the Payment Process Data Journey

Goods have been added to an online basket or shoppers have arrived at the cashier and now need to pay…

The Data Journey Begins

Consumer information could pass through as many as four or five different platforms before the ‘Order Confirmed’ or the ‘Approved’ status on the card terminal is shown. This journey, or hops, often look like this;

Cardholder – Merchant – Credit Card Network or Bank – Payment Processor

This all may seem straight forward, but the route the data actually takes to pass through these providers can be very different. Traditionally, the data packets are sent from stop to stop with no control of the route or where it passes through on its journey to authorisation.

When data takes a complex route, it could make digital services slower and less reliable.

Where LINX Fits In

The London Internet Exchange (LINX) has been running an interconnection platform in London for over 25 years. The platform connects networks to each other providing a safe, trusted, and secure ecosystem to pass online data.

Connecting to an Internet Exchange Point (IXP) is common practice for telecoms networks such as Internet Service Providers (ISPs) and Content Delivery Networks (CDNs), as they make up a large portion of the Internet as we know it.

Over the past few years, networks from other industries like the enterprise and finance sector are now finding this solution very relevant for them as they embark on their ‘digital transformation’ journey.­

Networks passing traffic through an IXP like LINX is called ‘peering’. When you peer, you are able to choose, view and control the route your traffic takes to its destination. Networks have the opportunity to ‘peer’ directly with other networks via a single connection, one to many.

There are many benefits to peering, from lower network latency, meaning faster transactions to having more control over the route your data takes. This is where it becomes very important for financial services, and particularly payment processors.

LINX have an ecosystem of payment processors who are pioneering this method of data transfer for their sector, doing business in a secure and resilient environment.

Networks simply purchase a single port to connect to LINX from any of their 16 data centre locations across London. From there, they can peer with other key networks, whether they be banks, ISPs or other payment processors.

Infrastructure behind payment processors can also access the new LINX Closed User Group for financial services. This is a smaller ecosystem where networks can pass regular data and traffic with their regular peers or like-minded businesses.

Check out who is connected to LINX in London currently and reach out to the interconnection team to see how you can meet these networks.

If you want to be put in touch with one of our interconnection experts then Contact Us

 

Article Sources

UK Finance https://www.ukfinance.org.uk/

*https://www.bbc.co.uk/news/business-57495751

https://www.fisglobal.com/en/insights/merchant-solutions-worldpay/article/how-a-payment-transaction-is-processed

https://www.fisglobal.com/en/insights/merchant-solutions-worldpay/article/how-a-payment-transaction-is-processed

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