MOTO payments explained

MOTO payments aid businesses to accept card payments via telephone or mail to complete a remote transaction.

The huge opportunity to sell online opened new horizons for merchants to expand their reach globally and increase profitability through new channels. However, across some markets or demography, not all customers would prefer to use a website or mobile app to complete a remote transaction. Some of them may prefer telephone or mail. This is where MOTO payments offer a versatile solution for merchants to cater to the unique needs of such customers.

In this article, we explain what MOTO payments are, how they work, if they are suitable for your business and how to benefit from this type of payment. Let’s get into it.

What are MOTO payments?

MOTO for short stands for mail order telephone order payments. This type of payment transaction between a merchant and customer occurs remotely. They are classified under card not present payment transactions processed via email, telephone or even post.

MOTO payments enable businesses to accept card payments remotely, without the physical presence of the cardholder or their card. To accept secure MOTO transaction, businesses need to partner with an experienced and trustworthy payment service provider who can facilitate it.

Whether you are an early-stage startup or an established business, MOTO could be ideal for unlocking new revenue streams if you are selling products or services and need to accept payments over the phone remotely. Let’s look at what type of business can use MOTO payments.

What types of businesses use MOTO?

Knowing and understanding your customer preferences is a crucial component before including MOTO payments in your strategy. Hence, conducting your market research is effective way to figure out if MOTO is right for your business.

MOTO can used across several businesses that want to introduce an additional option into their payments mix and fulfil the needs of customers who do not want to Input their card details online or lack access to internet during a transaction. Some of these businesses may include:

• Hotels, travel and ticketing agencies
• Non-profit organisations
• Online retailers
• Catering companies
• Restaurants and food takeaways
• Telemarketing and other service based businesses

Furthermore, businesses without a website or web shop can accept payments using the Pay by link feature operated by the MOTO virtual terminal. This saves merchants resources by reducing infrastructure costs, automating record-keeping for transactions and allowing them to serve customers who prefer this payment option.

What is a MOTO virtual terminal?

At the heart of MOTO payment processing lies the virtual terminal, a web-based application that functions as a digital card machine. It allows merchants to process a transaction by manually entering payment card information and processing transactions on behalf of their customer.

How secure are MOTO virtual terminals?

A report by Juniper Research, found that online payment fraud is projected to grow from $48 billion in 2023 to a staggering $343 billion by 2027. The importance of security measures in payments cannot be overstated, hence MOTO payments processing and virtual terminals use multiple layers of protection to safeguard merchants and consumers.

One of these security measures is the Address Verification System (AVS). Virtual terminals utilise AVS to verify the cardholder’s identity by cross-referencing the provided billing address the information stored by the card issuer. For optimal security, it’s crucial to confirm with your payment service provider that the customer’s billing address falls within the jurisdictions covered by AVS service for optimal security. If the information is compatible, the payment will be approved and processed.

Furthermore, at emerchantpay, we ensure our virtual terminals adhere to the latest Payment Card Industry Data Security Standards (PCI DSS) requirements. These requirements are comprehensive security standards that guarantee that all transactions are processed in a secure and compliant environment. With added encryption technologies, it protects sensitive card data while tokenisation replaces card details with unique identifiers.

MOTO virtual terminals with the aid of payment gateways also incorporates sophisticated fraud detection to flag suspicious transactions in real-time. These tools work tirelessly to identify and prevent fraudulent activity before they can impact your business.

By leveraging these multi-faceted security measures, virtual terminals provide a secure environment for MOTO transactions, instilling confidence in both merchants and customers.

How do MOTO payments work?

MOTO payments are designed to be fast, secure and user-friendly, offering a seamless experience for both merchants and customers. For MOTO payment processing, you need two essential components: a MOTO merchant account and a MOTO virtual terminal. Both are typically provided by the business's chosen as your payment service provider like emerchantpay.

The MOTO transaction process is straightforward and can be completed in just a few simple steps as follows:

MOTO virtual terminal log in

The merchant logs into their virtual terminal using the email address and password associated with their account. This can be done via an app or any desktop browser.

Card details

Enter the customer’s debit or credit card details and send it off to the payment processor to verify.

Verification and authorisation process

Once the correct card details entered are submitted, they are securely submitted through the virtual terminal and it is sent to the relevant payment processor for verification and payment authorisation.

Confirmation

The customer will receive an automated receipt via email that confirms the validity of the transaction.

Settlement of funds

The merchant will then receive the funds from the sale depending on their settlement agreement with their payment service provider.

What are the benefits of MOTO payments?

We have identified earlier that being able to process payments remotely can be a game-changer for businesses either small or large. Let's look in detail the benefits of MOTO transactions for your business.

Convenience and accessibility

It offers convenience and accessibility for both merchants and customers. With a virtual terminal, businesses can process payments from anywhere, at any time, using any device with internet access. This flexibility eliminates the need for in-person transactions and allows businesses to cater to customers regardless of their location.

Fast and secure

MOTO payments provide a fast, secure and trusted way for customers to pay for goods and services. By leveraging secure payment gateways, businesses can ensure that sensitive payment information is protected during transmission. This level of security not only protects customers from fraud but also enhances their trust in this type of payment.

Expanded customer reach

One of the key benefits of MOTO payments is the ability to reach more customers. MOTO is mostly the preferred payment method for many consumers who do not want to enter their card details online and prefer phone call. By offering MOTO as a payment option, businesses can expand such customer base, driving more revenue.

Streamlined payment experience

MOTO payments, especially phone payments, require almost no clicks, making the process quick and seamless. This streamlined experience enhances customer satisfaction and saves time, for customers. By prioritising ease of use, businesses can improve customer retention.

Downsides of MOTO payments

While useful to businesses and consumers, there are certain downsides to MOTO payments merchants must be know about. Let's look at what they are and how to mitigate them.

Higher fraud risks

MOTO transactions could make it easier for bad actors with stolen cards to attempt illegitimate transactions. To combat this, merchants can use AVS and require the CVV code, which is the three or four digital numbers on the back of a credit or debit card to validate all transactions.

Additionally, the inclusion of the 3D Secure two-factor authentication by the payment provider will serve as an extra layer of security.

Increased chargeback liability

MOTO payments may expose merchants to chargebacks as it makes it easier for customers to claim didn't authorise a transaction leading to revenue loss and other chargeback fees.

Merchants must maintain clear communication with customers and keep detailed transaction records. Consider working with a payment's provider for guidance and support with your chargeback strategy.

Sensitive data security

The handling of sensitive data over the phone or by mail introduces additional security risks or concerns. Merchants must ensure strict compliance with PCI DSS regulation to protect customer information.

Merchants should always use PCI DSS compliant MOTO virtual terminals, as well as to train their staff on properly storing or discarding consumer data properly when no longer needed.

Implement MOTO payments with emerchantpay

Serving customers remotely has become commonplace and even the norm for several industries. It should be top of mind to balance offering the preferred payment method of your customers with the necessary security features to safeguard them and your business.

At emerchantpay, we work with businesses of all sizes to harness their ability to accept remote payments like MOTO, along with other in-store and online payment options. Our comprehensive solution includes:

• A MOTO virtual terminal
• Pay by link functionality
• Advanced fraud management tools
• Strategy advisory and support to optimise your payment strategy