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Settlement Process & Processing Summary

In the world of payments, settlement is the final and most crucial step. It’s the process where the merchant receives the actual funds from the card transactions processed via Payment Options. This page outlines how settlements work on our platform and explains the key metrics used in your merchant settlement reports.

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Payment Options Settlement Process

Payment Options manages payment processing across multiple acquirers and payment methods, ensuring that merchants get paid efficiently and securely.

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Step-by-Step Breakdown

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1. Transaction Initiation

• A customer initiates a payment on the merchant’s website or app.

• Payment Options securely routes this transaction to the appropriate acquirer based on configuration.

• The acquirer authorizes the transaction after validating the card and available funds.

• If the authorization is successful, the transaction is tagged as “Authorized”.

• Depending on the merchant’s settings:

  • Purchase (Auto Capture): Payment Options automatically captures the amount.

  • Manual Capture: The merchant captures the amount after fulfilling the service or product.

• Only captured transactions are considered eligible for settlement.

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2. Settlement

• Payment Options initiates the settlement process:

  • Reconciles incoming settlement data from the acquirer with internal transaction records.

  • Deducts the Merchant Discount Rate (MDR) and any applicable fees.

  • Transfers the net amount to the merchant’s designated bank account as per the scheduled Payout Date.

• Merchants receive a Settlement Report on their defined cycle:

  • Daily

  • Weekly

  • Monthly

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3. Merchant Payout

• After reconciliation and fund transfer initiation, the final amount is credited to the merchant’s bank account.

• Settlement timelines may vary, depending on acquirer and settlement agreement.

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Processing Summary Definitions

These definitions help merchants interpret the figures shown in their settlement reports.

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1. Purchase / Capture Sales Amount

Definition:

Total transaction amount where the payment was successfully captured.

Includes:

• Transactions where:

  • transaction_type = PURCHASE and transaction_status = Captured

  • OR

  • transaction_type = CAPTURE and transaction_status = Captured

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2. Refund Amount

Definition:

The total amount refunded to customers.

Includes:

• Transactions where:

  • transaction_type = REFUND and transaction_status = Refunded

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3. Successful Transaction Count

Definition:

Total number of successfully processed transactions.

Includes:

• Transactions where:

  • transaction_type = PURCHASE and transaction_status IN (Captured, Authorised)
  • PLUS
  • transaction_type = AUTHORISATION and transaction_status = Authorised

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4. Declined Transaction Count

Definition:

Count of all transactions that were not successful (i.e., declined or failed during processing).

Includes:

• Transactions where:

• transaction_type = PURCHASE and transaction_status = NOT SUCCESSFUL

• PLUS

• transaction_type = AUTHORISATION and transaction_status = NOT SUCCESSFUL

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5. Refund Fee Count

Definition:

Number of successful refund transactions.

Includes:

• Transactions where:

  • transaction_type = REFUND and transaction_status = Refunded

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Why This Matters

Understanding how settlement works ensures better cash flow visibility and allows your finance team to reconcile reports accurately. Our reports are designed to reflect the real-time financial health of your transactions — showing not only what was processed but also what was paid out.