What does the back-end processor do after receiving captured transactions?

The back-end processor plays a crucial role in the payment processing cycle after it receives captured transactions. Its primary function is to format the transaction data received from the front-end systems and prepare it for submission to the interchange network. This includes structuring the data in a way that is compliant with the standards required by the interchange, ensuring that the information can be accurately processed by various payment networks.

Submitting transactions to the interchange is essential because this is the step that ultimately allows funds to be transferred from the customer's bank account to the merchant's account. The back-end processor ensures that all the relevant details, such as transaction amounts, merchant identification, and customer account information, are correctly presented and transmitted.

Other tasks such as initiating refunds, merging transaction data with historical records, or handling customer service operations, while important in the overall transaction process, do not fall primarily into the responsibilities of the back-end processor immediately after capturing transactions. These functions are typically managed by different departments or systems that may interact with the back-end processor but are not its direct responsibilities at the point of transaction processing.