Credit card processing is the system by which businesses accept payments made using credit or debit cards. When a customer makes a purchase, the card information is securely transmitted to the payment processor, which communicates with the card-issuing bank to verify and authorize the transaction. Once approved, the funds are transferred from the customer's account to the merchant's account, minus any processing fees. This process typically involves several parties, including the merchant, payment processor, acquiring bank, issuing bank, and card networks like Visa or MasterCard.

If you have a good credit score, you'll almost always qualify for the best interest rates, and you'll pay lower finance charges on credit card balances and loans. The less money you pay in interest, the faster you'll pay off the debt and the more money you have for other expenses.