ABA NumberAlso known as the routing or transit number. A nine digit number used by financial institutions for identificaiton.
Access FeesFees are associated with using a secure server (such as Authorize.Net) to approve and process transactions. Depending on their contrat with the payment gateway processor, a merchant account may also be charged gateway processing feesr as part of the monthly processing fee.
ACHAn acronym for Automated Clearning House electroic network.
ACH AuthorizatiuonAn acknowledgment by an account holder that allows an ACH transaction, either credit or debit, to be applied to a particular account.
ACH Credit/ Credit TransferWhen the money is pushed into an account, it is known as an ACH credit transfer. In other words, the customer (the payer) triggers the money to be sent to the business merchant (the payee).
For example, as a customer, when a customer sets up a payment through your credit card or bank to pay a bill, it will be categorized as an ACH credit.
ACH Debit /Debit TransferWhen the money is pulled from a bank account, it is called an ACH debit transfer. It means that the customer (the payer) is allowing the business merchant (the payee) to take funds from their account.
For example, when a customer sets up a recurring payment (monthly, annually, etc.), ACH debit is the method used to debit the payment from the customer's account automatically.
ACH NetworkThe ACH network is a system used for the electronic transfer of money between bank accounts in the U.S. The ACH system was created in 1974 by the National Automated Clearing House Association (NACHA), as a way for Air Force employees to get paid on time. Widespread adoption of the Internet and digital services, the ACH system was modified to handle direct deposit, tax payments, tax refunds, and many other financial transactions.
ACH OperatorAn ACH operatory processes ACH transactions between companies or individuals. Currently, the Federal Reserve Bank and the Electronic Payments Network (EPN) are the two operators that help facilitate transactions between ACH originators and ACH receiver.s
Account Funding TransactionA term used by Visa indicates an e-commerce transaction has occurred to add funds to a Visa prepaid account. The transaction is posted to a Visa card and includes the transmission of the Account Funding Transaction Indicator.
Account HistoryThe payment and transaction history of an account.
Account Takeover / ATOA type of online fraud where an individual often, through theft, gains access to an online account and takes control and access of the account from the account owner.
ACH/Automated Clearing HouseElectronic payment networks are most commonly associated with direct payroll deposits and recurring payments and are the networks most commonly used to settle merchant cards.
Acquirer/Acquiring BankA financial institution that maintains the merchant credit card processing relationship and receives all transactions from the merchant for distribution to the Cardmember Banks.
Acquirers AssociationA regional, independent, and nonprofit organization that provides training, education, and networking opportunities for professionals working in the acquiring side of the bankcard industry, including financial institutions, ISOs, MLSs, equipment vendors, and value-added services providers.
Acquirer Reference Number /ARNA unique number is attached to a card transaction when passed from the merchant's bank to the cardholder's bank. ARNs are used to track transactions. Also known as trace IDs since they are often used to trace where the funds for a transaction are in the process.
Addenda RecordA type of recordhat contains additional data that is needed to verify the identity of an account holder or to provide additional information regarding an ACH transaction.
Address Verification/AVSA service where the merchant verifies the cardmembers' address, primarily used by Mail, Telephone, and Internet merchants. AVS does not guarantee that a transaction is valid.
Address Verification Service /AVSA service that helps protect against fraud by verifying the identity of the person claiming to own the credit card. The system will check the billing address of the credit card provided by the user with the address on file at the credit card company. AVS does not guarantee a transaction is valid.
AffiliateA licensee of Visa International, Visa U.S.A., or an organization associated with a Mastercard member that contributes under the merchant's rule or card plan on either the cardholder or merchant side.
Affinity CardA Visa, Mastercard, Discover, or American Express card bearing the trade name or mark of an affinity partner, issued through marketing alliances, an organization, or a collective group (such as a professional association or particular interest group). The affinity partner's name and logo are on the card, and the partner then solicits its membership or group for exclusive rewards or promotions. Affinity cards are popular with sporting teams and university alumni groups. Affinity cards work like regular credit/debit/prepaid cards and are accepted anywhere that the card brand is accepted. The card issuer often pays the affinity organization a royalty on charge transactions.
Affinity PartnerAn affinity partner is an individual with a relationship with a credit card issuer for the issuance of affinity cards. The individual is not eligible for membership with a card brand.
AgentsIndividuals or organizations who sell bankcard services to merchants on behalf of ISOs, acquirers, and processors. Also known as merchant-level salespeople (MLSs) and independent sales agents (ISAs), most agents are independent contractors. However, sometimes agents are paid employees of ISOs, acquirers, and processors.
American Bankers AssociationA nonprofit organization serving the banking industry, founded in 1875. Members include community, regional, and money center banks, holding companies, savings associations, trust companies, and savings banks.
American Express/AmexDiversified worldwide travel, financial, and network Services Company founded in 1850. American Express issues credit, prepaid, and charge cards that support a broad base of clients and the needs of both consumers and businesses. All American Express cards begin with "3."
Any procees or system formally used to fight money laundering. It can also refer to the policies and regulations by regulatory bodies.
Anti-Money Laundering /AML
Any procees or system formally used to fight money laundering. It can also refer to the policies and regulations by regulatory bodie
Application Programming Interface /APISoftware, tools, documentation, and definitions that provides a way for two or more computer programs to communicate with each other. It is a software interface that offers a service to other pieces of software.
Approved Scanning VendorA business certified by the PCI Security Standards Council that scans networks and systems to identify weaknesses in system configuration.
ArbitrationThe procedure an Acquirer may use to resolve a complaint with a card issuer on behalf of an establishment.
AssessmentsFees paid to Mastercard and Visa for marketing and administrative costs. Assessments are a percentage of the sales passed through the interchange fee.
AssociationsLicensing regulatory agencies for bankcard activities which include Mastercard International, VISA U.S.A. OR VISA
ATM Interchange FeeA fee is paid to the Acquirer by the cardholder bank for an ATM transaction. The ATM network sets ATM Interchange fees.
AuthorizationApproval by, or on behalf of, the card issuer validating a transaction for a merchant or another affiliate bank. An authorization indicates only the availability of the card member's credit limit at the time the authorization is requested.
Authorization Approval CodeA number issued to a participating merchant by the Authorization Center confirms the approval for a transaction.
Authorization FeeA fee charged each time a transaction is sent to the card-issuing bank to be authorized. In addition, the bank charges an authorization fee for all requests, whether approved or not. Note this is not the same as a Transaction Fee or Per Item Fee.
Authorization Only TransactionTransactions are created to reserve an amount against a credit card's available limit for intended purchases. An authorization-only transaction ensures that a credit card has a limit high enough to allow a transaction. An authorization-only transaction is intended for a merchant's protection to ensure that the credit card has a limit high enough to enable a transaction.
Auto-Representment ChargebacksCredit not issued, unauthorized transactions or other chargebacks are automatically resolved on the merchant’s behalf without their knowledge or intervention.
Automated DepositAn ACH deposit made to a bank account or another depository financial institution (DFI).
Automated Response Unit /ARUAn ARU allows the manual keypad entry and subsequent authorization of a credit card over a cellular or land-line telephone. For example, a business typically imprints its customer's card with an imprinter and then processes the transaction instantaneously over the phone.
Average Monthly Volume /AMVThe average amount of transactions processed by an organization (merchant, processor, etc.) during a month expressed in dollars.
Average Ticket
Back-end Conversion /BOCPaper check conversion (paper to digital) occurs in the merchant's "back office ."Paper checks are typically scanned. The merchant must notify consumers that BOC will occur at the point of sale.
Back-end ProcessorA data processing company that contracts with acquirers to provide communication and processing systems that connect with the interchange systems for clearing and the ACH systems for settlement services. The back-end processor receives the data, captures items from the front-end processor, and formats and submits the items to the card company for clearing and settlement. The back-end processor also handles all chargeback and retrieval processing, the production of merchant statements, and the formatting of the merchant deposit for submission to the depository bank or into the ACH.
Back billingA pricing structure where the qualified discount rate for the current period is detailed on that month's statement. Downgrades, transactions, and monthly fees are billed on the following month's statement.
Bank Identification Number /BIN)A numerical code is assigned to each federally insured financial institution for routing transactions and other purposes. ISOs and MLSs board merchants using the BINs of their respective acquiring or merchant banks.
BankcardA bank card is any card issued against a depository account, such as an ATM or debit card. Since banks issue them, Visa and MasterCards can be referred to as bank cards. The difference is that credit cards are not directly linked to a depository account.
Bankcard Association /Bankcard NetworkA group of institutions uses a common processing and administrative center to sponsor a bankcard program.
Bankcard Service ProviderA third-party association, including independent sales organizations and member service providers, provides merchant and cardholder services for issuers and acquirers.
Basis PointOne one-hundredth of a percent; one basis point is 0.01% or0.0001; 10 basis points would be 0.10% or 0.001 0; 25 basis points would be 0.25% or 0.0025; 100 basis points would be 1.0% or 0.0100.
BatchUsually, a day's worth of transactions, including sales and credits, are processed by the card processor.
Batch AuthorizationA process in which the authorization requests are accumulated and sent at one time for authorization. Responses return in a grouping or batch. Batch authorization is particularly effective when real-time authorization is not practical or when the order to ship an item is not requested in a real-time situation.
Batch Authorization Transaction SystemA system that is designed to allow specific merchants to batch authorizations on their time schedules.
Batch CloseThe process of sending transactions to the processor for clearing and settlement. Also known as end-of-day closing or terminal balancing.
Batch Header TicketThe electronic submission merchant uses the identifying form to indicate a batch of sales or credit slips (usually one day's transactions).
Batch ID NumberA sequential number is assigned to each submitted batch. Each transaction within the batch shares the same reference number, which is used mainly for reconciliation and retrieval.
Batch ProcessingA data processing procedure in which similar input items are batched together for processing, as opposed to real-time processing that takes place as the transaction occurs. Accumulating the data in advance means that the user cannot influence the processing while it is in progress.
Batch SettlementAn electronic procedure in which the front-end processor consolidates the transactions within a group or batch and forwards the batch to the back-end processor for submission to the card company for clearing and later settlement or payment of funds to the Acquirer. The Acquirer then funds the merchant's account for the payment.
Bill DetailInformation from a biller that provides line-level information to a customer, including specific billing event information such as credit card charges, telephone calls, or kilowatts used. Also called invoice detail.
Bill backA means of recovering or reducing interchange fees for transactions clearing differently than planned. The processing company passes the charges to the merchant.
Bundled RateA discount rate offered to the merchant includes both the qualified discount rate and the transaction fee. However, a separate transaction fee is not billed to the merchant.
Buy RateThe fee associated with the acquiring bank is equal to the interchange fee (paid to the issuing bank) plus the acquiring bank's markup.
Card IssuerA regulatory organization authorizes financial organizations to issue credit cards to individual cardholders.
Card LaunderingWhen a merchant processes sales through their merchant account on behalf of another merchant. Laundering violates the terms of merchant agreements, also known as draft laundering or factoring.
Card Member AgreementThe card member agreement provides the terms and conditions of a credit card account. Federal law as a consumer disclosure requires this agreement. It also represents a binding agreement between card issuers and their customers. It must include the annual percentage rate, the monthly minimum payment formula, annual fees, and dispute resolution processes.
Card Present TransactionsTransactions made when a credit card is physically present. Merchants are charged different fees by the card brands depending on the fraud risk involved with a transaction. Because the card is available for inspection, card-present transactions are considered less risky and therefore carry lower fees than online or phone transactions.
Card TypeRefers to the brand of a card – VISA, Mastercard, Discover, American Express, etc., and what type of card – consumer credit, business, check card, rewards, etc.
Card Verification Value /CVVThe three or four-digit number typically follows the account number located on the signature panel on the backside of most credit and debit cards. CVV numbers on American Express cards appear on the face of the card above the card number.
Card Verification Value 2 /CVV2The Card Verification Value 2 is a three or four-digit number physically imprinted on the back of the card. CVV2 is a security feature often mandatory for card-not-present (MOTO/internet) transactions. CVV2 data is not embedded in the magnetic stripe.
Card-Not-Present TransactionsCard transactions (Internet or MO/TO purchases, for example) for which the customer's card is not physically present and therefore not handled by the merchant. Interchange is set higher on these transactions because there is a greater likelihood of fraud involved during the transaction process.
CardholderAlso referred to as cardmember. The authorized user to whom a credit card has been issued.
Cardholder Access DeviceA cardholder uses a terminal, personal computer, or other devices to initiate an electronic commerce purchase transaction.
Cardholder BankThe bank that has issued a bank card to an individual is often used to identify the card-issuing bank in an interchange arrangement.
Cardholder DisputeA dispute initiated by the cardholder can be in the form of a chargeback.
Cardholder Initiated Chargeback A cardholder initiates a dispute in the form of a chargeback. Reasons for the dispute include non-receipt of goods or services, incorrect transaction amount, or a duplicate transaction. Also called a substantive chargeback.
Card Member BankA cardmember bank is a bank that issues a bank card to an individual. The term is frequently used in conjunction with interchange arrangements to identify the card-issuing bank.
CaptureWhen a card is authorized, a second dataset is transmitted for the transaction; this data set is called a capture. It confirms that the transaction has occurred with the data passed on to the acquiring bank for settlement.
Capture DateThe date when an acquirer processes a transaction.
Cash CardA cash card is loaded with a preset value, not linked to an individual's bank account, that could be used to withdraw money from ATMs. Depending on the issuer, a cash card can also be used to make purchases.
Charge TypeEach card type's particular card also provides a pattern for downgrades. Some card types/charge types are only available for particular MCC/SIC codes (certain merchant industry types).
ChargebackA returned transaction resulting from the lack of adherence to the conditions of the Sales Agreement, Card Association regulations or Operating Procedures, and the resultant debiting of the merchant account.
Chargeback DefenseThe information a merchant needs or uses to defend against a chargeback, such as an invoice, a customer verification, or proof of shipping.
Chargeback PeriodThe number of calendar days from the central processing date of a transaction receipt during which the issuer may exercise a chargeback right. The number of days varies from 45 to 180 days, according to the type of transaction.
Check 21Check 21 is referred to as Remote Deposit Capture because an image of a check is captured and used in place of the original document.
Check CardsA card tied to a cardholder's DDA bearing the logo of Visa, MasterCard, or Discover. A PIN is not entered at the point of sale, and the transaction is assessed through the Visa, MasterCard, or Discover Interchange. However, the transaction does require a cardholder signature, similar to a credit card transaction.
Check Imager/Check ReaderA hardware device that can be integrated into a terminal or point of sale device that reads the MICR line on a check for authentication, negative file comparison, or truncation.
Check VerificationAn authorization service allows merchants to look into a database to determine if customers have a history of returned checks. Merchants may also add checks returned for nonsufficient funds (NSF).
Clearing BankThe member designates the bank to receive the member's daily net settlement advisement. The clearing bank conducts funds transfer activities with the net settlement bank and maintains the member's clearing account.
ClearingExchange of transaction information.
Clearing AccountA checking account is set up at a financial institution that will receive a member's credit or debit for net settlement.
Clearing BalanceA financial institution in an account maintains the balance at a Federal Reserve or correspondent bank.
Client Reference NumberAn eight-digit number supplied with a credit card transaction. This number is given to the Acquirer along with a retrieval request.
Code 10Code 10 calls occur when merchants are suspicious about accepting a credit card. The phrase "Code 10 authorization" is used to avoid alerting the customer that the merchant is suspicious of their card. The operator then asks the merchant a series of YES or No questions to determine whether the merchant is wary of the card or the cardholder. The merchant may be asked to retain the card if it is safe.
Commercial CardsCommercial cards are credit cards utilized by corporations or businesses.
ComplianceCompliance with the VISA and Mastercard an dother card network rules and regulations.
Counterfeit cardA payment card which has been fraudulently printed, embossed or encoded to appear to be a genuine bank card,not authorized by a card network or authorized issuer.
Convenience CardChecks issued by credit or prepaid card companies are used in situations that do not take physical credits to allow the cardholder additional access to their line of credit or prepaid card balance.
Convenience CheckChecks issued by credit or prepaid card companies. Convenience checks are for card-not-present situations and allow the cardholder additional access to their line of credit or prepaid card balance.
Corporate CardsCorporate cards are credit cards utilized by
CreditA refund or price adjustment for a previous purchase transaction.
Credit BureauA company that records and sells information regarding the payment behavior of consumers and issues credit reports. Also called a credit-reporting agency.
Credit DraftA document evidencing the merchandise return by a cardmember to a merchant or other refund made by the merchant to the cardmember.
Daily DiscountDaily discounts apply to merchants that do not have previous processing history. The qualified discount rate is deducted from a merchant's batch sales total before their batch deposit. At the end of the month, the transaction fees and monthly fees are deducted from the merchant's DDA.
Data BreachAn incident where card data and other personally identifiable information (PII) may have been viewed, stolen or used by a fraudster.
DDADirect deposit account
DFIDepository Financial Institution
DebitAn entry on an account's record that represents the transfer or removal of funds from an account.
Debit NetworkDebit networks transmit transaction data between the merchant bank and debit card issuer. There are a variety of debit networks, and a debit card that supports each network will have its logo printed on the debit card. There are three types of debit cards: 1- Debit ATM, 2 -Online Debit Card, and 3 – Offline debit cards.
Debit TransactionA transaction involving a pin-based debit card.
Demand Deposit AccountA Demand Deposit Account is an individual bank account that is credited or debited for deposits, fees, and adjustments.
DisbursementAfter a transaction has been approved, it is the distribution of funds, including getting the various fees to the stakeholders in the process.
Discount RateThe amount a merchant processor charges a merchant to give credit for depositing and handling merchants' daily credit card transactions.
DIPThe insertion of the embedded chip or EMV end of a debit or credit card into a reader to complete a transaction.
DowngradesWhen a transaction does not meet the qualifications for a particular level, it is assessed with an additional fee. For example, if a transaction that would typically be swiped is keyed, that transaction will downgrade and be assessed accordingly.
Draft LaunderingSee card laundering
DUKATDerived Unique Key Per Transaction (DUKPT) is a key management scheme in which, for every transaction, a unique key is derived from a fixed key. Therefore, future and past transaction data are still protected if a derived key is compromised since the next or prior keys cannot be determined easily. EBT- See "Electronic Benefits Transfer."
E-CheckType of electronic transactions that debit a checking account.
Early Termination Fee /ETFA fee is charged for the termination of the merchant account before the contract end date.
Electronic Benefits Transfer /EBTThe delivery of annuity and public assistance benefits through plastic payment cards.
Electronic Bill PayDigital or online methods consumers use to pay bills. The device sends electronic instructions to withdraw funds from cardholder accounts and pay merchants.
Electronic Data Interchange /EDIA computerized system allows linked computers to conduct business transactions through a computer-to-computer exchange of standard business data according to agreed-upon data formats.
Electronic Funds Transfer /EFTThe method of performing financial transactions electronically. The Pulse and Star ATM networks are examples of EFT systems.
Electronic Serial Number/ESN
A parament identification number is used to recognize mobile devices
EMV/ Europay, MasterCard and VisaEMV stands for Europay, MasterCard, and Visa, a global standard for inter-operation of integrated circuit cards and IC card capable point of sale terminals and automated teller machines for authenticating credit and debit card transactions. It is a joint effort initially conceived between Europay, MasterCard, and Visa to ensure chip-based payment card security and global interoperability. The EMV standards define the interaction between IC cards and IC card processing devices for financial transactions at the physical, electrical, data, and application levels. There are standards based on ISO/IEC 7816 for contact cards and standards based on ISO/IEC 14443 for contactless cards.
EntitlementsAlso known as card types. The credit card processing services are provided to an establishment.
EncryptionA standardized method of scrambling data automatically in the terminal or computer before data ibefore transmisison.
Ethernet ProcessingTo process over an IP-based system.
Exceeded TimelinessExceded Timeliness is a transaction that is deposited late. The authorization date, compared to the processing date, exceeded the time frame allowed for the interchange level for which the merchant is priced.
Expiration DateThe date embossed on the credit card beyond which the card is not acceptable by the establishment at the point-of-sale.
Federal ReserveThe central banking system of the U.S. is comprised of the Federal Reserve Board, the 12 Federal Reserve Banks, the Federal Open Market Committee, and the national and state member banks.
Finance ChargeThe issuer assessed the fee on a cardholder's ongoing balance, providing the financial institution's income.
Fleet CardsPrivate label credit cards are designed mainly for business vehicle repairs, maintenance, and fueling.
Floor LimitThe floor limit is an amount at which credit and debit card transactions must be authorized. The floor limit amount is specified in each merchant's processing agreement.
Four Tier PricingFour Tier pricing is a pricing structure with four distinct tiers - one qualified rate for credit cards, one qualified rate for check cards, a mid-qualified surcharge, and a non-qualified surcharge.
Fraud InvestigationThe process of identifying suspicious merchant and cardholder activity.
Front-EndThe front-end is responsible for collecting card information in various forms (terminal, gateway, software) and processing it to conform to a specification the back-end can use. The front-end interface sits between the user and the back-end, allowing the merchant to request transaction authorization.
FundingThe payment to a merchant for their approved transactions.
Funds AvailabilityThe day and time when funds in an ACH transaction are made available to a merchant.
GatewayIn payment processing, any network that connects merchant POS terminals with transaction processing and settlement networks, such as Mastercard and VISA settlement networks. Gateways can also provide related services, including transaction management and reporting. Gateways, commonly refer to as an Internet Gateway such as Authorize.net, allow merchants to set up shopping carts or accept transactions when the card is not present.
GuarantorOne who guarantees an obligation and has a legal duty to fulfill it.
HackerA person or organization that attempts to or circumvents conmputer systems or networks security measures to gain control and access and steal card data and other senstive information.
High TicketThe dollar amount of a merchant's largest transaction.
Hold backSee “Reserve”
Host CaptureWhere the Service Provider stores cardholder data.
Hosting ProviderA business that provides services to merchants and other service providers, where their customers’ data is “hosted” or resident on the provider’s servers. Typical services include shared space for multiple merchants on a server, providing a dedicated server for one merchant, or web apps such as a website with “shopping cart” options
Independent Sales Organization /ISOAlso referred to as a Merchant Member Service Provider, a type of Member Service Provider (MSP) that supports a member's acquiring program by soliciting merchants and presenting the member merchant agreement.
Instant Payment Notification /IPNA method online retailers to automatically track purchases and other server-to-server communication in real-time.
Integrated Point of Sale /IPOSThis acronym refers to conventional credit card terminals that are "smarter" and more sophisticated. For example, A payment processor can set up integrated point of sale terminals to communicate with terminals owned by the same merchant located at different locations and with different merchant numbers.
InterchangeA term used to refer to the clearing and settlement system as a whole.
Interchange FeeAcquirer pays interchange fees to the issuer. In addition, they reimburse the issuer for the risk of loss ( fraud and credit losses) and the cost of processing the transaction.
Interchange Plus PricingA pricing structure where the interchange fees, dues and assessments are passed directly on to the merchant. Basis points and a charge per transaction for the authorization is added to cover the cost and provide profit. This structure is sometimes also referred to as cost-plus pricing. This type of pricing is for larger-volume merchants.
Issuing BankCardmember's bank, or the bank which has issued a MasterCard or Visa card to a cardholder.
Know Your Customer /KYCThe compliance process of confirming the identity of a merchant or customer. Typically government, bank, and card network requirements to verify identity to prevent fraud, identity theft, money laundering, and terrorist financing.
Level II Corporate CardsBusiness, corporate, or government GSA purchasing cards (p-cards or purchase cards) require specific data to qualify for certain interchange levels. For example, to have transactions qualify for level 2 pricing, you must use a certified product that collects and submits the data correctly to Visa/Mastercard must be used.
Level Ill Corporate CardsBusiness, corporate, or government GSA purchasing cards (known as p-cards or purchase cards that require specific data to clear at certain interchange levels. A certified product is used to correctly collect and submit the data to Visa/MasterCard to have transactions qualify for Level 3 pricing.
Magnetic Character Reader/ MICRA countertop device is used to scan and recognize magnetic ink character lines. A MICR line is a series of digits at the bottom of a check that provides details about the bank and account on which the check is drawn and supports authorization and clearing routines.
Magnetic StripeA stripe of magnetic information is attached to the back of a plastic credit or debit card. The credit card's magnetic stripe contains three tracks of data. The first and second tracks are encoded with information about the cardholder's account, such as their card number, full name, the card's expiration date, and the country code. Additional information can be stored on the third track.
Mail Order Telephone Order/MOTOA type of transaction where the merchant typically has a card terminal and manually keys in the required card information for each transaction for transmisison to the appropriate authorization network.
Manual Credit Card TransactionA transaction manually keyed (as opposed to swiped) into a POS System.
MarketplaceAn online eCommerce business where multiple third parties offer products or services for sale, but all transactions are processed by the marketplace.
MATCH ListSee "TMF."
MediaThe documentation of monetary transactions (i.e., sales drafts, credit slips, computer printouts, etc . ).
Media Retrieval RequestsMedia retrieval describes the process of where paper documents are acquired from a centralized soruce. Media retrieval requests fall into two categories: 1) requests for sales records from cardholders and 2) requests for documentation ito defeend againist a chargeback from card issuers. Merchants must fulfill media retrieval requests within 12 days of receipt. The status is fulfilled late if you meet media retrieval requests after 12 days of receipt. The status is expired if you cannot fulfill the media retrieval requests.
Member Service Provider"Independent Sales Organization."
MerchantA person or firm contractually associated with an acquirer that accepts payments for goods and services rendered.
Merchant AccountA checking account established by a merchant to receive payment for transactions.
Merchant Account NumberA number assigned to each merchant by the payment processor or merchant services provider for accounting and billing purposes.
Merchant AgreementA written agreement between a merchant and a bank detailing their respective rights, duties, and warranties concerning the acceptance of the bank card and related bank card activity.
Merchant BankA merchant bank is a bank that sponsors an acquirer into the Mastercard and VISA card systems.
Merchant Category Code /MCCA code assigned by the Acquirer to identify a merchant's type or mode of business and the goods or services sold.
Merchant DiscountA merchant discount is the percentage of the transaction value or a set fee after cost. The merchant discount is how the Acquirer receives reimbursement for its expenses. It covers interchange fees, authorization costs, and costs of sales draft processing.
Merchant NumberSee "Merchant Account Number."
Merchant Service ChargeAn entity or individual that contracts with a member to provide merchant sales and solicitations. (2) A type of registration for MasterCard under the Member Services Provider (MSP) program. See "Independent Sales Organization."
Merchant Settlement AmountThe net dollar amount of card transactions processed for each business day.
Merchant StatementA comprised report produced daily, weekly, or monthly to note the transaction deposit volume and billing information of a merchant account for a selected period.
MICRSee "Magnetic Ink Character Reader."
Mid-Qualified Discount SurchargeDiscount rate and sometimes the transaction fee charged in addition to the qualified discount rate for transactions that are key-entered batched out within 24 hours of the transaction time and have AVS. A mid-qualified rate is higher than a qualified rate. Some transactions grouped into the mid-qualified tier can cost the provider more in interchange fees, so the merchant account providers make a markup on these rates.
MID-Qualified TransactionsA MID Qualified Rate is the percentage rate merchants are charged when they accept credit cards that don't qualify for the lowest rate. Possible reasons include keyed manually vs. swiped into a POS, a business card, or a rewards card.
Monthly DiscountThe monthly discount applies to merchants who can supply at least one previous month of processing statements from the previous three months. Their sales total (less returns and third-party amounts) is deposited into their Direct Depoist Account (DDA). All discounts, transactions, and monthly fees are deducted from the merchant's DDA at the end of the month.
Monthly MinimumA way to ensure the merchants pay a minimum fee each month and cover costs from the provider to maintain the account. If the merchant's qualified fees do not equal or exceed the monthly minimum, they will be charged up to the monthly minimum. The qualified discount rate calculates the monthly minimum in a three-tier or four-tier pricing structure. For example, if a merchant processes $20,000 in volume and their qualified discount rate is 1.69%, the merchant would have paid $338.00 in qualified discount rates. Because $338 is more than $25.00, the merchant would not be billed the monthly minimum. On the other hand, if the merchant processes $2,000 in credit card volume and the qualified discount rate is 1.69%, the merchant would pay $33.80 in qualified discount rates. In the second scenario, the merchant did not reach the $25.00 monthly minimum and was assessed with an additional $8.10 to get the merchant up to $25.00 in qualified discount rates. Finally, in an interchange-plus pricing scenario, the basis points charged to the merchant are what count towards the monthly minimum.
Multi-Factor AuthenticaitonWhen two or more factors are used to authenticate a cardholder or device user. Factors can include using smart card or dongle, user passwords, passphrase, or PIN, or action a user peforms such touching a pad using their fingerprints,facial recognition or other biomentric secuity methods.
National Automated Clearing House Association /NACHAThe National Automated Clearing House Association (NACHA) is a non-profitt trade association. NACHA develops the operating rules and business practices for the nationwide network of automated clearing houses (ACHs) and other areas of electronic payments. The National Automated Clearing House Association (NACHA)'s ACH Rules govern the ACH system. Participating financial institutions use the rules to transfer funds electronically.
Near Field Communication /NFCA form of communication between smartphones or other handheld devices and a payment terminal to complete transactions.
Net SettlementThe resolution of a bank's transactions at the end of the day, including all cash, checks, and electronic transfers.
Non-BankA financial institution or company that does not offer banking services.
Non-Qualified Discount SurchargeDiscount rates and sometimes transaction fees are charged in addition to the qualified discount rate for transactions that do not meet the qualified or mid-qualified requirements. Business card and key-entered foreign card transactions will always be charged the non-qualified rate.
Non-Qualified Discount TransactionsA card transaction that does not meet qualifications for authorization by the cardholder's bank qualifications, such as receipt of a valid billing address or completion of batch settlement within three days.
Offline DebitAt the point of sale, an online debit card immediately deducts funds from the bank account. Online debit cards can have the MasterCard, Visa, or Discover logo or only the user's logo, like an ATM card.
Pass-Through PricingSee "Interchange Plus Pricing."
PayeeThe person or organization that receives a payment.
Payment Card Industry /PCI Data SecurityCreated to ensure the security of payment card information. Failure to adhere to the standard (by any party that handles card information, including merchants and ISOs) can result in hefty fines. Often shortened to PCI.
Payment Facilitator /PayFacA payment facilitator (PayFac) is a merchant services provider that establishes payment processing services for business owners, so they can accept electronic payments online or in-person.
Payment Service Provider /PSPA PSP designation by Visa and Mastercard permits merchants to onboard sub-merchants under their account.
Payment GatewayA payment gateway refers to the front-end technology that reads payment cards and sends customer information to the merchant acquiring bank for processing. The payment gateway is an essential aspect of all electronic payment card processing. A payment gateway authorizes payments for businesses, online retailers, bricks and clicks, or traditional brick and mortar. It is the equivalent of a physical point of sale terminal in most retail outlets; see "Gateway."
PCI ComplianceAdherence to the Payment Card Industry Data Security Standard. All card brands require PCI compliance.
PCI DSSSee "Payment Card Industry Data Security Standard."
Pin DebitA debit card transaction authorized by a cardholder using a personal identification number to complete the transaction.
Point of SaleThe point at which a product or service is purchased and delivered.
POSSee "Point of Sale."
POS TerminalElectronic transaction terminal used in an electronic point-of-sale (POS) system. The terminal interacts with a computer file to approve transactions and transmits sales information for posting against customer accounts.
PostingUpdating individual cardholder account balances to reflect a merchant’s sales, instant cash, cash advances, adjustments, payments, and other charges or credits.
Pre-AuthPre-auth is also called an authorization hold. Pre-authorization occurs when the cardholder's bank immediately authorizes a credit card transaction but holds the funds as unavailable from the merchant until they officially clear (settles) the transaction. Per-auth allows for changes in the sale amount between the time of authorization and settlement. For example, hotel stays where last-minute phone calls or room service use could affect the amount of the final bill after checkout.
Prepaid CardA payment card with a set amount of money preloaded for future use by the consumer. It is not a credit card or debit card. Prepaid cards are used in an open-loop (branded by Visa, MasterCard, and so forth) or closed-loop (merchant or mall-branded). The most common prepaid card in use today is the gift card.
Primary Account Number /PANThe cardholder's account number to which transactions are charged.
Private Label CardsUnique cards are branded for a specific retailer, independent dealer, organization, or manufacturer; if the retailer doesn't manage the private label card, third-party issues the cards and collects the payments from cardholders. Contracts between the retailer and the third-party detail terms and conditions.
ProcessorA processor is a company that moves transactions on behalf of acquirers among merchants, banks, and card networks. Some, but all acquirers, are processors.
Purchasing CardsA purchasing card is a company credit card for goods and services to be procured without using a traditional purchasing process.
Qualified Discount RateThe percentage of the merchant's volume is charged to process their transactions. The qualified rate is the best rate a merchant can receive per their merchant agreement. For a retail merchant, this will be a swiped consumer credit or check card transaction. For a MOTO or Internet merchant, this will be a keyed consumer credit or check card transaction using AVS and including an invoice number. For retail and MOTO/internet merchants, the transaction must be batched out within 24 hours of the time of the transaction.
Reason CodeA code is used to provide more detail about a declined transaction or status change. Reasons codes include chargebacks, subsequent presentment, fee collection, funds disbursement, or source document requests.
Receiving Depository Financial InstitutionAlso known as RFDI, it is a bank or credit union that is qualified to receive ACH entries.
ReconciliationThe process where incoming and outgoing funds and transactions are matched up.
Recurring TransactionA transaction is periodically charged to the cardholder's account for ongoing goods or services for which a cardholder has granted written permission to a merchant.
ReferralThe message received from an issuing bank when an attempt for authorization requires a call to the Voice Authorization Center.
Remote Deposit CaptureElectronic check services by which paper checks are converted into digital images for electronic clearing and settlement, through either electronic check or ACH systems.
RepresentmentA transaction presented to the issuer by the Acquirer when the establishment requests a reversal of a chargeback.
ReserveThe money is set aside from a merchant's credit card receipts to cover potential chargebacks or other disputes. Typically, the amount is returned after a specified period. Also known as hold back.
Response CodeA number provided by a card-issuing bank to a merchant explaining why a particular transaction was declined or verifying the transaction acceptance.
Retrieval RequestA request to a merchant for a legible copy of the original sales record.
ReversalA request by the establishment to signify a chargeback to the card issuer.
Rewards SurchargeAdditional discount rate charges for swiped rewards transactions. The default pricing for swiped cards is mid-qualified.
Sales PartnerA sales partner is an independent contractor that submits merchant account business to a payment processer like IntelliPay.
SettlementThe process where the processor, working on behalf of the Acquirer, debits the issuer for a transaction. The processor then credits the Acquirer, and the Acquirer credits the merchant. The settlement also involves payment to the card brands, calculating the discount, and qualifying a transaction for the appropriate interchange. Other aspects include exception processing, returns, and disputes.
Settlement StatementA statement is provided to a merchant detailing approved sales, credit activity, billing information, fees, and chargebacks during a defined period, typically a month.
Shopping CartA shopping cart is a gateway software that acts as an online store's catalog and ordering process. A shopping cart is an interface between a company's website and its deeper infrastructure, allowing consumers to select merchandise; make changes, and complete a purchase.
SIC Code-Standard Industry ClassificationCode assigned by an Acquirer to identify a merchant's business type.
Signature DebitA Visa Debit or Debit Mastercard transaction authorized by a cardholder's signature; to the casual observer, it looks just like a credit card transaction; See also "Check Card" and "Off-line.
SkimmingA method of stealing credit card information using a small, handheld electronic device that scans and stores card data from the magnetic strip. Done manually by criminals who place a skimming device on top of a regular credit card reader (usually at gas stations or ATMs) and retrieve it later.
Smart CardA plastic card containing a computer chip with memory capabilities used for identification purposes or to store information, monetary amounts, or other forms of data.
Sponsor BankSee”Acquirer”
Stored-Value CardA credit-card-sized device implanted with a computer chip with stored money value. A stored-value card can be reloaded or reused by adding an amount to it from an automated teller machine or other devices.
SubmissionThe process of sending batch deposits to the Acquirer for processing.
Summary AdjustmentThe Acquirer corrects an establishment's deposit when there is an error in the submitted deposit.
Super ISOA large, independent sales organization that supports multiple downstream ISOs and MLSs. Some super ISOs are also processors.
Swipe FeesAnother way of describing Interchange fees.
TAPA chip-embedded card is held next to a specialized reader, and payment data is transmitted via near-field communications (NFC). Also known as Contactless transactions. Tap transactions are faster than swiping and dipping and are as secure as dipped EMV transactions.
TerminalA POS device is connected to a bank card payment network or a proprietary network that authorizes payment card transactions and transmits card data to a receiving institution.
Terminal CaptureA piece of software in a payment terminal that allows the capture of credit or debit card information for transmission to a bank for authorization
Third-Party ProcessorA company that lets a company process another merchant's payments via their merchant account and then transfer the money to their bank account.
TIDA unique identification number is assigned to a specific point of sale device by the Acquirer.
Tiered PricingTiered pricing is a pricing structure that has set amounts for the different qualification levels.
TMF /Terminated Merchant FileA list when consumers do not honor the terms of their credit agreements, the creditor may report the default to a credit reporting agency. Also known as "MATCH."
TransactionA credit card sale or refund between the cardholder and merchant, or processing of the exchange by the Acquirer.
Transaction FeesService costs are charged to a merchant on a per-transaction basis.
Travel and Entertainment Cards / T&E CardCharge cards used to pay for a hotel, airline, and other business-related expenses.
TruncationTo shorten by or as if by cutting off.
Valid DateThe card issuer embosses the date on the credit card. An establishment cannot accept a card for payment of goods or services before this date.
Value Added Reseller / VARA company that adds features to an existing product then resells it (usually to end-users) as an integrated product or complete "turn-key" solution.
VAR SheetA sheet used by Value Added Resellers to assist in setting up the account.
Voice AuthorizationAn approval response is obtained through interactive communication between an issuer and an acquirer, their authorizing processors or stand-in processing, or by telephone.
Web Merchant AccountAn account utilizing the internet.
Web ACH ValidationA web validation is only run the first time the system “sees” a bank account. The validation process compares the name on the account, routing number, and account number on file (account data), with the information a customer enters when making their payment. If the system has historical records for the account, it is
validated, and IntelliPay returns this as an “approval.”
Wire Transfer / EFTAn electronic transfer of funds.
Wireless Credit Card TerminalA Wireless Credit Card Terminal is a device that allows data transmissions over wireless networks and works similar to a cell phone.
Wireless FeesFees charged for wireless usage
Wireless Merchant AccountAn merchant account using a wireless terminal/POS system.