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Credit Card Processing in SAP

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Presentation on theme: "Credit Card Processing in SAP"— Presentation transcript:

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

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