Understanding industry card payment terminology can be confusing, so here at ACP we have put together some simple explanations to key terms used in the card payment industry.
Card holder – The person who the card was issued to or an authorized user of the card and is financially responsible for payments made using the card.
Card not Present (CNP) – This is a card payment made where the cardholder is not physically present when the transaction is made. They are not able show the card for a merchant’s visual examination or for then to verify using their pin.
Chargeback – When a customer requests the purchase amount to be returned to their card. There can be many reasons why this may happen. The customer does not receive their goods. The customer does not receive the services. The customer did not place the order. The customer did not make the purchase. This being the case they can then request the issuing bank to charge back the value. The merchant will need to validate the purchase by providing required information.
Chip and Pin – Secure method of undertaking a face to face Transaction. – (see Pin below)
Contactless – Contactless payment systems are devices which use radio-frequency identification for making secure payments.
Credit Card – A payment card, banks earn money through interest charged to the cardholders. There are possibly other fees and if not sure you should check with your provider. Credit card issuing banks have a charge known as interchange.
Debit Card – A payment card that lets buyers pay for goods and services with funds from their account.
E-Commerce – The supply of goods and services conducted electronically over the Internet.
Face to Face (F2F) – Also known as a Customer Present Transactions. – The Cardholder is physically present when the transaction is processed and the card transaction is processed using a Point of Sale Terminal.
Gateway – A payment processing solution that protects cardholder data during the payment process.
Interchange Rate – A fee charged by Visa and MasterCard to complete a transaction.
KYC (Know Your Customer) – KYC is the due diligence that financial institutions and other regulated companies use to identify their clients and ascertain the relevant information required.
Merchant – Merchants are the establishment or person authorized to accept card payments. for goods or the services that they supply.
Merchant Account – This is the type of bank account that allows businesses to accept payments in multiple ways, be this via debit or credit cards and , this account is used for the settlement of payment card transactions.
Merchant Bank – A bank where merchants hold their account(s).
Mail Order Telephone Order (MOTO) – These are cardholder not present transactions where the payments are taken over the phone or in writing.
Payment Card – A general term used for any plastic card be it Credit, Debit or Charge.
Payment Card Industry Data Security Standard (PCI DSS) – This is a standard for organizations to apply by if they handle credit cards from the major card schemes.
Payment Terminal – also known as a point of sale terminal, credit card terminal, or a PDQ terminal – It is the device that interfaces with the payment card to make the transfer. There are various types of terminals available but, most have the same basic purpose and functions.
Mobile Terminals – These terminals use a mobile telephone connection. you can away from a fixed location and still accept card payments, for example, a stall holder, show, exhibition or on the road Merchants can use a mobile terminal, provided that a stable signal is available.
Online Payments – The terminals listed are physical pieces of hardware that are used to accept card transactions These can be used when the merchant is with their customers – or used to key in the card details for a card-not-present transaction.
Portable Terminals – The difference between a portable terminal and a mobile terminal is that it must be used within a specified radius of a base station. The base station must be connected and sited. These terminals are predominantly used within the hospitality industry.
Standalone also known as counter-top – These terminals accept card payments at a fixed location. You will require a power socket and cabled Ethernet connection.
Integrated payment terminals – Simply put: integrated payment terminals are networked.
PDQ – Process Data Quickly.
PIN – A personal identification number commonly used to verify a transaction.
Point of Sale (POS) – This is the time and place when a retail transaction is completed. It is also the point at which a customer makes a payment for goods or services received.
PWCB – Purchase with Cash Back – an optional transaction type that can be offered by a merchant. The merchant can choice to have this feature activated or disabled in the vast majority of cases.
Set Up Fee – Some Acquirers, Processors and ISO providers will charge a one-off fee for the setting up the card processing arrangements.
Terminal – This is the hardware device that captures card payment details and submits these for processing.
Void – A void cancels a transaction.