Definition
Card-present (CP) transactions occur when the physical card or a device wallet is read by a terminal via chip, tap, or swipe. Card-not-present (CNP) transactions include e-commerce, phone orders, invoices, and recurring billing where the card is keyed or stored.
Because the cardholder is verified in person, CP transactions carry lower interchange (often 0.5-1.0 points less), lower fraud rates, and, with EMV chip, fraud liability on the issuer. CNP transactions cost more, see 10x the fraud rate, and place liability on the merchant unless 3-D Secure is used.
Example
The same $100 sale on a rewards credit card costs about $1.85 in interchange tapped at a counter and about $2.40 keyed into an online checkout.
How HL Hunt handles it
HL Hunt unifies CP and CNP on one account and one ledger: Tap to Pay on iPhone and Android, countertop terminals, online checkout, and a virtual terminal, each priced at the correct interchange category automatically.