Anatomy of an EFT transaction

Anatomy of an EFT transaction

One of Kill Bill most popular features is its plugin framework. At a high level, to integrate with a new payment processor, all you need is to write a plugin implementing the PaymentPluginApi, which defines the basic payment operations the gateway may support. The five most important payment operations are: authorizePayment capturePayment purchasePayment voidPayment creditPayment refundPayment If the names sound familiar, it’s because they map to the basic credit card operations: authorizePayment: perform an authorization (i.e. reserve the funds on the account but no money is moved) capturePayment: acquire the funds from an authorization (funds are settled the day of the capture) purchasePayment: acquire the funds immediately (a.k.a sale) voidPayment: cancel an authorization and free the reserved funds on the card creditPayment: credit the customer (without associated sale or capture) refundPayment: refund the customer (reverse of a sale or capture) But these actions are not limited to credit card payment methods. The BitPay plugin for example implements the purchase call for paying in bitcoins. And it turns out that the same concepts also apply for Electronic Funds Transfer (EFT) transactions (direct debit, wire, etc.). A payment processor which offers EFT APIs will typically work with a bank (similar to acquiring banks in the case of credit cards) to which it will forward the debit requests. Settlement (when your merchant account receives the funds) usually occurs after the customer funds have arrived into the processor’s bank account, although some processors will fund in advance to speed up the process (bearing the risk funds may never come). While in its simplest form, a debit transaction can be seen as a simple...
Kill Bill partners with Forte to offer ACH transactions

Kill Bill partners with Forte to offer ACH transactions

ACH is incredibly popular in the US. In 2013, the network processed about 22 billion transactions, with a total value of $38.7 trillion. So, if you want to accept it on your website, how do you get started? Usually, the first step is to partner with a bank, which will become your Originating Depository Financial Institution (or ODFI). It will act as the intermediary between you (the merchant, or originator) and the Federal Reserve. To initiate a transaction, you will upload a file to the bank FTP server. Once the OFDI processes it, it will forward the request to the Federal Reserve and either credit or debit your bank account. In turn, the Federal Reserve will transmit the transaction(s) to the recipient bank account (Receiving Depository Financial Institution or RDFI), which will update its account balance as well. If the request doesn’t go through (because of insufficient funds, invalid account number, etc.), the RDFI will send a return file to the ODFI (again via the Federal Reserve), which will update your balance accordingly. This process can take up to 5 days and isn’t easy to implement at a technical level, assuming you managed to find a bank to work with it in the first place. Luckily, some actors are actively trying to disrupt the space to not only speed up the transfer of money but also to lower the barrier of entry into the network. Today, we’re pleased to announce that we have partnered with the team at Forte and have integrated their Advanced Gateway Interface (AGI) into Kill Bill. You can now very easily add an ACH option...