Description: An authorization code is a unique identifier generated by a payment processor to confirm a financial transaction. This code acts as a security mechanism that validates that the transaction has been approved by the buyer’s financial institution. When making an online purchase, the merchant sends the customer’s credit or debit card information to the payment processor, which in turn communicates with the issuing bank to verify the availability of funds and the authenticity of the card. If the transaction is approved, an authorization code is generated and returned to the merchant. This code is essential to complete the transaction, as it ensures that the money will be transferred securely. Additionally, the authorization code can be used to resolve disputes or to process refunds, providing a clear record of the transaction. In the context of online commerce, the use of authorization codes is crucial to maintaining consumer trust and ensuring that transactions are conducted securely and efficiently.
