Installments Transaction

In This Article:

• Overview

• How does the Authorization Work in Installments Transactions?

• How to Create an Installments Transaction? 

Overview

In a single-payment transaction, the customer, or cardholder, pays the entire transaction amount in one installment. In contrast, an installment transaction divides the transaction amount into several payments over a longer period, thereby reducing the immediate payment obligation for the cardholder.

Installment transactions are unique to Israel, meaning they can only be executed using Israeli cards and in Israeli shekels (ILS). Foreign cards and/or foreign currencies are not eligible for installment transactions.

With PayMe, transactions can be made in up to 12 installments.

How Does an Installment Transaction Work?

To execute an installment transaction, the credit card company Authorizes (in Hebrew: "reserves credit") for the cardholder. This amount to be authorized every month for the same purchase decreases as the actual payments are made.

For example, the reserved credit for a transaction totaling 1,000 ILS in 4 installments will initially be 1,000 ILS and will decrease with each monthly payment.

Detailed breakdown:

• In the first month, the cardholder pays 250 ILS, reducing the reserved credit to 750 ILS.
• In the second month, another 250 ILS is paid, reducing the reserved credit to 500 ILS.
• In the third month, another 250 ILS is paid, reducing the reserved credit to 250 ILS.
• In the final month, the cardholder pays the last 250 ILS, fully releasing the reserved credit.

By default, the merchant receives the money monthly.

However, it is possible to receive the full transaction amount upfront (while the cardholder continues to pay in installments) by subscribing our Discount service.  

How to create an Installments transaction?

1. Log in to your account. 
2. Navigate to Transactions -> Create New.

3. Click on the Manual Payment button.

4. Fill in all the fields:

Customer - the customer's name.

Product - what is the customer paying for.

Amount - amount to be charged.

• Please notice that you have to fill in the full amount to be paid, not the amount of the installment. 

Currency - ILS/USD/EUR

• Please note - it is not possible to charge an Israeli card in foreign currencies.

Installments - number of installments.

5. Click Insert Payment details.
6.  Fill in the credit card information and click on Pay. 

How to recognize an installment transaction in the clearing interface?

1. Navigate to Transactions and click on the desirable transaction you'll want to check

2. In the Installments field you can see the number of installments

In order to see which transactions make up each transfer you receive from PayMe, you can download the Withdrawals Correlations Plugin. This plugin breaks down all transfers into specific transactions, including the specific installment in a transaction. Basically, this plugin makes it easier to manage the cash flow of your business.

Installments Transaction Fee

The fee charged in an installments transaction is also spread over installments. In other words, the transaction fee will be charged every month from the specific payment and not all at once during the first payment. For example: a transaction of NIS 1000 in ten installments, each payment will be NIS 100 With a clearing fee of 1.5%. Each month we charge NIS 1.50 for the clearing fee and we will do so for 10 months, in practice the amount is the same amount.

The transaction will be refunded in installments as well.