1. ABA routing number
Also referred to as a "transit routing number" or "routing number". A 9-digit number that identifies the financial institution for directing Automated Check Handling (ACH) funds.
2. ACH
Automated Clearing House. A network for processing financial checking transactions electronically. ACH transactions normally do not require a paper or scanned check image. Normally what's submitted are the bank's routing number and account number from which to withdraw the funds. Sometimes the bank name and account type are also required.
3. Acquirer
A financial institution that maintains the merchant's credit card processing relationship and receives all transactions from the merchant to be distributed to the cardmember banks.
4. Agent bank
Smaller financial institution that contracts to become an issuing and/or acquiring agent of another card association member bank.
5. American Express
An organization that issues American Express® cards and acquires transactions, unlike Visa ® and MasterCard ®, which are associations.
6. API
Application Programming Interface. An abstract set of functions that allows one software program to interact directly with another program or operating system. Programmers who write applications that can interact with other applications often use APIs.
7. Approval
The response from the system that indicates a point-of-sale (POS) transaction was received, processed, and approved.
8. ATM
Automated Teller Machine - A device where a cardholder can enter his or her personal identification number (PIN) and can access his or her checking, savings or credit card accounts in order to deposit/withdraw funds instantly.
9. Authorization
Approval by, or on behalf of, the card issuing bank to validate a transaction for a merchant or another affiliate bank. An authorization indicates the availability of funds on the cardholder's card at the time the authorization is requested.
10. AVS
Address Verification Service. A service that verifies a cardmember's address by comparing the address given against the address on file with the card-issuing bank. The AVS service is used to combat fraud, especially with mail, telephone, or e-commerce orders. A positive AVS response is not an assurance that a transaction is valid (since the fraudster may have access to the cardholder's address information). Conversely, a negative AVS response does not necessarily mean the transaction is fraudulent--it is an indication of a higher probability of fraud.
11. Batch
Usually a day's worth of credit card, debit card, or ACH transactions, including sales and credits to be processed for settlement. Batches are typically processed once every 24 hours, but some merchants submit their batches more often.
12. BIN
Bank identification number. A unique six-digit number assigned by the card associations (i.e., Visa and MasterCard) to identify member transactions and accounts.
13. Capture
An action in which an authorized electronic credit card transaction is submitted for financial settlement. Authorized credit card sales must be captured and settled in order for a merchant to receive credit for his or her sales and a cardholder’s account to be debited and/or credited.
14. Card issuing bank
also known as Card issuer – A financial organization authorized by a regulatory organization (i.e., Visa, MasterCard, Discover) to issue credit or debit cards to individual cardholders.
15. Chargeback
The procedure for reversing funds against a cardholder disputed transaction. A cardholder initiates a chargeback by contacting their issuing bank, and filing a substantiated complaint regarding one or more items on their statement. Chargebacks are costly to merchants because they are responsible for returning the funds to the cardholder and paying the associated chargeback fee. Numerous chargebacks can affect eligibility for a merchant account, so merchants should take measures to prevent chargebacks as much as possible.
16. Credit card
A card that enables the cardholder to purchase goods or services against a line of credit established by the issuer
17. CVC
Card Verification Code: also called Card Verificaton Value (CVV), Card Verification Value Code (CVVC), or simply Card Code, is a security feature for credit or debit cards intended to protect against fraud. This term most often refers to a 3 or 4-digit code often printed on the signature line on the back of the card . A merchant should request the code when processing a card-not-present sale to help confirm that the card is legitimate. Merchants and payment processors are prohibited from saving the card code.
18. CVV
Card Verification Value: also called Card Verification Value Code (CVVC), Card Verification Code (CVC), or simply Card Code, is a security feature for credit or debit cards intended to protect against fraud. This term most often refers to a 3 or 4-digit code often printed on the signature line on the back of the card . A merchant should request the code when processing a card-not-present sale to help confirm that the card is legitimate. Merchants and payment processors are prohibited from saving the card code.
19. Debit card
A card used at a merchant location bearing a MasterCard or Visa logo and/or the marks of ATM networks (such as MAC, NYCE, Star) where the issuing bank is not extending credit to the cardholder, but where the card is connected to either a deposit account, a prepaid account or a prepaid benefit account.
20. Decline
A transaction response indicating that a Point of Sale (POS) card transaction was rejected
21. Discount rate
An amount charged for processing credit card transactions or signature debit transactions. Discount rates are charged as a percentage of the total transaction amount of sales and refunds.
22. eCommerce
Electronic commerce – The use of the Internet for commercial purposes such as banking, shopping (buying products/services from merchants and/or individuals), or purchases of financial services and products.
23. eCommerce transaction
A non-face-to-face online transaction that uses electronic media over a public (such as the Internet) or private (such as an Extranet) network to transfer cardholder account information from the cardholder to the merchant.
24. ESD
Electronic softgood download – Software or files, such as music or graphics, that can be downloaded or sent via electronic means to the customer.
25. Gateway
a.k.a., Payment Gateway: An application service provider that transfers payment information between a payment portal (e.g., an eCommerce website or IVR service) and the processor or acquiring bank.
26. Interchange
The exchange of transaction data between acquirers and issuers through the card associations. Sometimes the word "interchange" is also used to refer to the interchange fee, which is the fee paid by the acquirer to the card issuer for each credit card transaction that is settled.
27. Interchange compliance
A process to ensure that the appropriate interchange rate is applied to a transaction in accordance with card association requirements
28. ISO
Independent sales organization – an organization or individual that performs merchant and/or cardholder solicitation, sales and/or services on behalf of a card association member
29. Issuer
The institution (or its agent) that enters into a contractual agreement with MasterCard or Visa and issues credit cards to cardholders
30. Magnetic stripe
A stripe of magnetic information affixed to the back of a plastic credit or debit card. The magnetic stripe contains essential cardmember and account information which is read using a credit card terminal or card-swipe device in a face-to-face (retail) transaction.
31. MCC
Merchant category code – A code assigned by an acquirer to identify the type of business or the type of products/services offered by the business
32. Merchant
A business that provides products and/or services to customers in exchange for monetary compensation.
33. Merchant account
Account, through a member of the Visa ®, MasterCard ®, or other credit card network, which allows merchant businesses to accept credit cards from cardholders and receive electronic deposits containing the proceeds of the cardholder purchases minus applicable fees.
34. MID
Merchant identification – A unique identification number assigned to a merchant by the acquirer
35. MOTO
Mail order/telephone order – Refers to card-not-present transactions where the customer supplies their order and payment information by mail or telephone
36. PAN
Primary account number – The cardholder’s account number to which transactions are to be charged
37. PIN
Personal identification number – a number that is typically four digits in length that is assigned a debit card holder for identification purposes at an ATM or point-of-sale device
38. PIN debit
A transaction whereby the cardholder enters a personal identification number (PIN) through a special device (PIN pad)
39. POS
Point-of-sale – The moment at which a product is purchased and delivered
40. POS terminal
Point-of-sale Terminal – A device used by a merchant to connect to a payment processor to authorize, record, and settle transactions electronically
41. Processor
A party distinct from the bank that processes data from the credit card transactions and then distributes funds from the merchant’s bank account
42. Receipt
A hard copy (paper) document recording a transaction. The receipt usually includes date, merchant name/location, account number, amount, reference number and, if the cardholder is present at the time of the transaction, the cardholder's signature
43. Recurring transaction
A transaction that is periodically charged to the cardholder’s account for ongoing goods or services, for which written permission has been granted by a cardholder to a merchant.
44. Referral
The message received from an issuing bank when an attempt for authorization requires a call to the Voice Authorization Center
45. Representment
A transaction presented to the issuer by the acquirer when requesting a reversal of a chargeback
46. Retrieval request
A request to a merchant for either a legible copy or an original sales record
47. Sales draft
Evidence of a purchase of goods or services by a cardholder from a merchant using a card, regardless of whether the form of such evidence is in paper, electronic or otherwise, all of which must conform to card association rules
48. SET
Secure electronic transaction � A protocol developed by MasterCard ® International, Visa ® International and others to protect the security of credit card transactions conducted over the Internet
49. Settlement
The process by which members exchange financial data and value resulting from sales transactions, cash disbursements or merchandise credits
50. SIC code
The standard industry classification assigned by an acquirer to identify a merchant’s business type
51. Signature debit transaction
A transaction in which a debit card is used bearing a MasterCard ® or Visa ® logo, where the cardholder does not enter a PIN, but rather signs the receipt
52. Submission
The process of sending batch deposits to the acquirer for processing. This may be done electronically or by mail.
53. Swiped card
A transaction where a credit or debit card magnetic stripe is read by a card reader
54. TID
Terminal identification – A unique identification number assigned to a specific point-of-sale device by the Acquirer
55. Track 1
The first magnetic track on a financial transaction card. It is read-only, and its contents are defined in ISO 7813
56. Track 2
The second magnetic track on a financial transaction card. It is read-only, and its contents are defined in ISO 7813
57. Transaction
A credit card authorization, sale or refund between the cardholder and merchant, or the processing of the exchange by the acquirer
58. Transaction fee
Service costs charged to a merchant on a per-transaction basis
59. Voice authorization
When a merchant calls to obtain a verbal credit card authorization rather than using a terminal or credit card software to obtain the authorization. The merchant must, in addition to the voice authorization, submit the credit card information via terminal or software to close out the transaction and transfer the funds to the merchant’s bank account. This is performed by manually entering the transaction information into the terminal or software.
