1. Credit Card Processing in SAP
Robert Pulaski – Sr. Manager/Architect

2. Learning Points Why automate credit card processing?
A basic understanding of credit card processing
An overview of the process and related accounting for credit card processing in SAP
Highlight some important configuration in the IMG
Discuss implementation options and issues
Highlight some best practices

3. Why automate credit cards in SAP? Answer - Improved ROI
Improve cash flow by reducing outstanding receivables from 30 – 90 days to 1 to 3 days
Reduce bad debt
Possibly reduce paper invoicing costs
Increase transaction efficiency

4. Terminology Merchant ID – unique id identifying the supplier(you)
Processor (Clearing House) – provides authorization and settlement services
Merchant Bank – supplier’s bank(your bank)
3rd Party Provider – provides the interfacing solution to allow SAP to communicate with the processor

5. Process Flow for Credit Card Processing
Supplier requests authorization and at a later time batch settlement
Processor provides authorization and settlement services
Buyer gives credit card info
Banks issue and receive funds

6. Process Overview in SAP
Save valid sales order
Authorization request sent (real-time)
Authorization response - accept/decline (real-time)
Ship
Bill
Settlement (batch)

7. Save Valid Sales Order – VA01

8. Authorization Response – VA01

9. Authorization Response – VA01

10. Document Flow – VA01

11. Billing – Accounting Document – VF01

12. Accounts Receivable Customer – FBL5N

13. GL Account Open Item – FBL3N

14. Settlement – FCC1

15. Settlement – FCC1

16. Settlement – FBL3N

17. IMG Configuration

18. IMG Configuration – Setting Up Card Types

19. IMG Configuration – Setting Up Merchant ID

20. IMG Configuration – Assign Merchant ID

21. IMG Configuration – Account Determination

22. IMG Configuration – Assign Clearing Account

23. Implementation Options
Build a custom program(s) to interface with the processor(s)
Purchase a 3rd party solution from vendors such as Cybersource or Paymetric
Manual (as a backup?)

24. Pros/Cons Custom Programs
Lower initial external cost
Possibly lower transaction costs
If it already works – don’t fix it?
Cons
Custom development costs
Possible custom configuration in SAP
Maintenance of custom code

25. Pros/Cons 3rd Party Solution
No/little custom development costs
Less custom configuration in SAP
Maintenance/support of 3rd party vendor
Quicker to implement?
Can offer additional functionality beyond SAP delivered
Cons
Initial external cost
Possibly higher transaction costs

26. Implementation Issues
3rd Party Installation
Servers
Access keys
RFC calls
Etc..
Make sure you have good Basis and IT people if you attempt installation yourself. Otherwise best to have the 3rd party provider handle the installation.

27. Implementation Issues
Authorization horizon/validity
Authorization window – number of days within a shipping confirmation window before a valid authorization can be issued
Authorization validity period – number of days an authorization is valid before a new authorization is required
Typically days
Back orders can be a royal pain!

28. Implementation Issues
Additional charges
Exact total for additional charges such as freight not known
Solution – user exit

29. Implementation Issues
Split shipments
Partial or multiple shipments can require several authorizations
Solution – user-exit

30. Implementation Issues
Multiple cards on one order
Different credit limits
Different credit card owners
CRM – different capabilities (though similar process)

31. Implementation Issues
Foreign Currency
Make sure the clearing house you use can handle all currencies required

32. Best Practices
Encrypt credit card data via either 3rd party or SAP (4.6c)
Can require OSS notes
Limit access to credit card information via security
Only those who need access
Additional fraud checks
Address check
CID – Card Identification Number
Can require OSS notes or user-exits

33. Additional Transactions
FCC2 – Repeat Settlement
FCC4 – Display Logs
FCC3 – Delete Logs
FBRC – Reset Cleared Items
FCCR - Standard Reports
VKM1 – Credit Hold Report
VCC1 – Payment Card Credit Hold Report (New)

34. Different Flavors of SAP
CRM
SAP Retail and POS
Etc…

35. Summary
Automated credit card processing can be efficient and enhance ROI
In most cases buying a 3rd party solution is going to be the best option compared to building a series of in-house custom programs
There will be lots of issues that need to be thought out carefully
Take credit card fraud seriously

36. Q&A Robert Pulaski Senior Manager - Architect Hitachi Consulting
Direct:
Inspiring your next success! ®

37. 1103 / Credit Card Processing in SAP
Session Code:
1103 / Credit Card Processing in SAP