TERM
DESCRIPTION
3D secure

Technical standard created by Visa (Verified by Visa) and MasterCard (MasterCard SecureCode) to further secure Card Not Present (CNP) transactions over the Internet.

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TERM
DESCRIPTION
Acceptance
Term used to describe the action of accepting a payment card as a means of paying for goods or services purchased.
Account
Account established by an issuer with a person upon the issuance of one or more cards.
Account History
The payment history of an account over a specified period (e.g. the number of times the account was used, payment was past due, and so on)
Account in good standing
Process where a merchant makes a pre-authorization request for a small amount, in order to see if the account is valid (i.e. in good standing).
Account Management
Term used to describe the actions an issuer can take to control cardholder spending. This control can be exercised at the level of a range of cards, or for an individual card.
Account Number
Unique number assigned to a card by the issuer and which identifies a cardholder.
Account Takeover
Term used to describe the process whereby a criminal takes over the account of another person. Often linked to identity theft.
Acquirer
Institution that maintains merchant relationships, acquires data (itself or through its agent) relevant to a card transaction from a card acceptor, and submits that data to the payment scheme.
Activation
Term used to describe the set of activities performed by the issuer to encourage the cardholder to use a newly issued card.
Added Value
Product or service included with a card product to make it more attractive, for example free insurance.
Additional Cardmember
Address Verification Service (AVS)
The process of validating a cardholder's given address against the issuer's records, to determine accuracy and deter fraud. This service is provided as part of a credit card authorization for mail order/telephone order transactions. A code is returned with the authorization result that indicates the level of accuracy of the address match and helps secure the most favorable interchange rates.
Address Verivication (AV)
Authorization option that allows an S/E to verify the billing address of the cardmember.
Adjusted Balance
The method by which many issuers subtract payments during the month made on a credit card account along with adding finance charges incurred.
Adjustment
An adjustment is initiated by the acquirer to correct a processing error. The error could be a duplication of a transaction or the result of a cardholder dispute.
AEGNS
American Express Global Network Services – business area of American Express, founded in 1997 and partnering with leading banks and financial institutions worldwide to issue cards and acquire merchants on to the American Express network. It works closely with partners to develop a range of premium products and services for their customers and help them grow their card-issuing and merchant acquiring businesses.
Affinity Card
A customized card product, aimed at potential cardholders who share a common interest, activity or membership of a specific (typically non-commercial) organization. When the cardholder uses the card, the organization typically receives some kind of benefit.
Agent
Term used to describe a third party that performs activities on behalf of an issuer or an acquirer.
Altered Card
A card on which the original embossed or encoded information has been altered for fraudulent purposes.
American Express (Amex)
One of the main international payment card issuing and acquiring schemes, historically issuing its own credit cards as proprietor issuer, unlike Visa and MasterCard.
Annual Fee
An amount of money the cardholder pays to the issuer for the right to carry and use they payment card.
Annual Percentage Rate (APR)
Annual percentage of interest that the cardholder pays on outstanding balance on a credit card.
Anti Money Laundering
Term used to describe the set of activities that are put in place by a bank to prevent money laudering — the practice of engaging in financial transactions in order to conceal the identity, source, and/or destination of money.
Application Load File (ALF)
In MasterCard terminology, a file containing cardholder data and application data that has been prepared for loading onto a card.
Approval Code
The code or cryptogram given online by the issuer (or its agent) to the card when an authorization request has been approved. This code or cryptogram acts as proof of authorization.
Approval Response (Approved)
Authorization response whereby the issuer (or its agent) approves a transaction. This is sent to the acquirer for transmission in turn to the merchant.
Arbitration
The procedure used to determine responsibility for a disputed transaction. Arbitration may be used only after attempts to resolve the dispute through the exception processing cycle have been unsuccessful.
Association
Any entity formed to administer and promote credit and cards. The best known examples of associations are MasterCard and Visa.
ATM Fee
A fee that the issuer charges to the cardholder for the convience of withdrawing cash at an ATM.
Attrition
Term used in portfolio management to indicate cards that have not been renewed by cardholders and/or issuer.
Authentication
Process of assuring that a payment card transaction has been initiated by an authorized user of that card. From the merchant's point of view, authentication means getting the right information from the consumer, and having it verified by the transaction network.
Authorization
Verifying if a payment card has sufficient funds (credit) available to cover the amount of the transaction. Card and transaction validation is made by the issuer, according to the pre-set credit, fraud, security and issuer’s policy criteria. Authorization is obtained for every sale. An approval response in the form of a code sent to a merchant's POS equipment (usually a terminal) from a card issuing financial institution that verifies availability of credit or funds in the cardholder account to make the purchase.
Authorization Code
A code that a payment card issuing bank returns in an electronic message to the merchant's POS equipment that indicates approval of the transaction. The code serves as proof of authorization.
Authorization Only
A transaction that is created to reserve an amount against a payment card’s available credit limit /funds for intended purchases; the actual settlement may occur within three to five days, depending on the card type.
Authorization Response
An issuing financial institution's electronic message reply to an authorization request, which may include: 1. Approval (transaction was approved) 2. Decline (transaction was not approved) 3. Call Center (response pending more information, merchant must call the authorization centre)
Auto Close
A terminal feature that allows an end-of-day batch closing to occur automatically at a specified time, without having to be initiated by the merchant.
Automated Clearing House (ACH) File
A file with instructions for the exchange and settlement of electronic payments passed between financial institutions. It represents debits and credits to be deducted from an account automatically as they occur.
Automated Teller Machine (ATM)
An unattended, chip and magnetic stripe-reading terminal which, among other things, dispenses cash under a deposit or loan account held with a banking or other financial services company.
Average Daily Balance
This is the method by which most credit cards calculate your payment due. An average daily balance is determined by adding each day's balance and then dividing that total by the number of days in a billing cycle.
TERM
DESCRIPTION
Back Office
Term used to describe the set of activities performed to run the business. Most common examples include authorization, clearing and settlement.
Balance inquiry
Term used to describe the process where a cardholder transfers the outstanding balance of one credit card issuer to another, to benefit from lower interest rate or better payment options.
Balance transfer
Term used to describe the process where a cardholder transfers the outstanding balance of one credit card issuer to another, to benefit from lower interest rate or better payment options.
Bank Identification Number (BIN)
A unique series of numbers, assigned by a payment scheme, to identify the card issuer and the type of product.
BASE I
The Visa Authorisation System
BASE II
The Visa data processing system for facilitating clearing and settlement between Visa members.
Basel II
The standard created by the Basel Committee on Banking Supervision, published in June 2004, containing recommendations on banking laws and regulations, particularly focused on risk management.
Basic card account (basic card number, basic card)
Unique number assigned to primary / basic cardholder.
Batch
The accumulation of captured payment card transactions in the merchant's terminal or POS awaiting settlement.
Batch Processing
A type of data processing operation and data communications transmission where related transactions are grouped together and transmitted for processing, usually by the same computer and under the same application; generally regarded as non–real-time data traffic comprising large files; type of data traffic where response time is not critical.
Beta Test
A live operational and systems test for each type of card an issuer proposes to issue.
Billing cycle
Time between billing statements. With credit card statements, the time between billing statements may vary.
Biometrics
Term used to describe the set of characteristics that can be used to uniquely recognize a particular person. Examples include: finger prints, iris, minutiae.
Blocking
The action taken by a point-of-interaction (POI) terminal or by an acquirer host processing system to prevent the acceptance of cards that issuers designate should not be accepted.
Blue Box Line
Customized American Express cards tending to integrate the worldwide brand equities of American Express with those of the American Express issuing partner. It is primarily used as American Express Network line of cards.
TERM
DESCRIPTION
Call Referral / Call me
An authorization response which instructs the acquirer to contact the issuer in order to provide additional information so that the issuer (or agent) can decide to approve or decline the transaction.
Capture
The submission of an electronic payment card transaction for financial settlement. Authorized credit card sales must be captured and settled in order for a merchant to receive funds for those sales. Also see: Settlement
Capture Card
Authorization response whereby the issuer (or its agent) authorizes the recovery of the card and the acquirer requests the merchant or cash disburser to retain the card (if this can be accomplished by peaceful means).
Card Acceptance
Service contracted with merchant, enabling cardholder to pay goods and services using their card.
Card Account
A credit line for deposit facility accessed by a card issued to a cardholder that enables the cardholder to purchase goods and services or obtain cash.
Card Activated Terminal (CAT)
A remote device that reads captures and transmits card information in an unattended environment, that is without the presence of a merchant representative. Types of terminals include ATMs, automated fuel dispensers and ticket dispensing machines.
Card Generation
Plastic card personalization and production, related activities regarding card production.
Card Not Present (CNP)
Term used to describe the situation where a transaction is performed without the card being present. Typically the case for MO/TO and e-Commerce transactions.
Card Payment System
A payment system supporting payments made by financial transaction cards.
Card Reader
A device that is capable of reading the encoding on plastic cards.
Card Security Code (CSC)
Security feature for card transactions, providing increased protection for the merchants against credit card fraud. It is often asked for by merchants for them to secure card not present transactions. The CSC is a 3- or 4-digit value printed on the card or signature strip, but not encoded on the magnetic stripe. • MasterCard, Visa, Diners Club, Discover, and JCB cards have a 3-digit card security code. The code is not embossed like the card number, and is always the final group of numbers printed on the back signature panel of the card, or in a separate panel to the right of the signature strip. • American Express cards have a 4-digit code printed on the front side of the card above the number. It is printed flat, not embossed like the card number.
Card Verification Value (CVV)
A unique check value encoded on the magnetic stripe of a card to validate card information during the authorisation process.
Card-Absent Environment
An environment where a transaction is completed under both of the following conditions: • cardholder is not present • card is not present Transactions in this environment include mail/phone orders, recurring transactions, phone service transactions.
Cardholder
The authorized user of a card issued by a licenced issuer.
Cardmember Agreement
The printed agreement that provides the terms and conditions of a credit card account. In includes the annual percentage rate, the monthly minimum payment formula, annual fees and dispute resolution processes.
Cards in Force (CIF)
Total number of non-canceled cards issued by a particular issuer as of the end (or beginning, when stated) of a given period.
Cash Advance
A cash loan from a credit card using an ATM or bank withdrawal. Also withdrawing cash using POS terminal, which is used to perform authorization of funds against available balance or credit limit.
Cashback Card
A card where the issuer gives back to the cardholder a percentage of the amount of all transactions performed on the card.
Cashback Transaction
The process where a cardholder makes a purchase and requests an amount of money in cash.
Centurion Line
American Express flagship travel&entertainment and everyday cards imbued with the established and internationally recognized American Express brand equities (eg. American Express Green Card, American Express Gold Card).
Charge Card
Type of payment card. Transactions made on this card must be paid in full by the cardholder to his bank on receipt of the statement.transactions are billed in regular intervals (usually monthly).
Chargeback
The message sent by an issuer to claim back from the acquirer all or part of the amount of a disputed transaction. Often also used as a synonym of Dispute Resolution
Chip and PIN
Term used to describe the combination of a secure technology (chip) with a secure cardholder verification method (PIN).
Chip Card
See: Smart Card
Claim (dispute)
Process opened by cardholder with intention to verify if transaction is justifiable, compliant and/or made by particular cardholder.
Clearing
The process of routing, editing and summarizing transaction data between an acquirer and an issuer to facilitate posting of a cardmember's account and reconciliation of a participant's settlement position.
Close Batch
The process of sending the batch for settlement.
Closed loop
Payment industry term for a payment card that can be used only in a single store or group of stores.
Co-Branded Card
A card issued by a member in association with a commercial partner. When the cardholder uses the card, he/she typically receives some kind of benefit (points, miles, cash, etc.).
Code 10 Authorization
If a merchant suspects a card is fraudulent at the time of the transaction, he can call their voice authorization phone number and ask for a code 10. The voice operator will instruct the merchant on how to proceed.
Commercial cards
Generic name for cards issued for business use. Commercial cards include corporate cards, purchase cards, business cards, travel and entertainment cards.
Commission Fee
A fee charged by the acquirer for transaction activity at one of the acquirer's terminals.
Companion Card
Term used to describe a card with a special format (special shape, smaller size, etc) that is issued in addition to a card of normal format.
Completion
A completion transaction is the second phase to a Pre-authorization. A completion transaction triggers funds to transfer from the cardholder to the merchant. Completions cannot differ greatly from originally authorized amount.
Compliance
The procedure by which two members may resolve a compliance or rule violation that has resulted in a direct financial loss, and for which no chargeback reason code applies.
Consumer Card
Card products offered to consumers for personal use (as opposed to corporate cards).
Contactless
Technology that does not require physical contact between the card and the terminal. Instead, a radio frequency interface is used to exchange data between the card and the terminal.
Corporate Card
A card issued to large companies for use by their staff (typically 10 people or more within the corporation) in order to pay for business-related expenses.
Credit
An amount to be credited to a cardmember's card account.
Credit (Reversal)
Nullification of an authorized transaction (sale) that has not been settled. If supported by the card issuer, a reversal will immediately "undo" an authorization and return it to the open-to-buy balance on a cardholder's account. Some card issuers do not support reversals.
Credit Card
A payment card where all transactions for a given period (often one month) are reported on a single statement. The cardholder is expected to pay back at least a portion of amount by the payment date, and pays interest to the issuer on the remaining amounts. See also: Revolving credit card
Credit Line
The amount of money the issuer grants the cardholder on a credit card. The amount varies based on the credit-worthiness of the cardholder.
Cryptography
The methods and practice of transforming confidential information to make it unintelligible to parties not authorized to know it.
Customer Relationship Management (CRM)
Term used to describe the set of actions required to management the relationship with the customer.
TERM
DESCRIPTION
Data
Factual information that includes voice, text, facsimile, and video.
Data Capture
A data processing term for collecting, formatting, and storing data in computer memory according to predefined fields. When a terminal reads this information from a plastic card or from entries at a terminal, the information is stored in computer memory for later output.
Data Security Standard (DSS)
A security standard that includes requirements for security management, policies, procedures, network architecture, software design and other critical protective measures. See also: PCI DSS
Debit Card
A plastic card used to initiate a debit transaction. In general, these transactions are used primarily to purchase goods and services and to obtain cash. Requested funds are immediately debited against cardholder's debit card account.
Decal
Term used to describe the label displayed in a merchant location or at an ATM, designed to indicate the brand(s) that can be accepted.
Deferred debit card
Operates like a normal debit card, except the all purchase transactions are postponed until the end of the month, thereby giving the customer between 1 and 31 days of interest-free credit. Deferred debit is prepaid recurring expense (e.g. insurance, interest or rent) carried forward as an asset, until the associated service or benefit is received.
Delinquency
Term used to describe the situation where the cardholder is not up-to-date with repayments on a credit card.
Demand Deposit Account (DDA)
An account, such as a current account, from which the depositor can make withdrawals without prior notice.
Digital Certificate
In e-commerce, a public key that has been digitally signed by a trusted authority to identify the user of the public key.
Diners Club International (Diners)
One of the first independent charge card companies in the world. The company was founded in 1950. The company operated under MasterCard and Carte Blanche briefly and is now a subsidiary of Discover Financial.
Direct debit
Direct debit (also direct withdrawal) is an instruction that a bank account holder gives to bank to collect an amount directly from another account. It is typically used to make recurring payments for credit card or utility bills (standing order or recurring payments).
Discount Rate
The fee a merchant pays an acquirer to process a purchase charged to a card.
Discover Card
Newest of the payment brands, began in 1986. It is the smallest of the four payments brands in terms of market share. Discover Card's payment networks Discover Network, PULSE and Diners Club International.
Dispute Resolution
A defined procedure which allows issuers and acquirers to resolve transaction disputes. If the dispute cannot be resolved, either of the two parties may file an arbitration case.
Domestic Transaction
A transaction where the issuer of the used is located in the transaction country.
Dormancy
Term used in portfolio management to indicate cardholders that have stopped using their card.
Downtime
The period during which computer or network resources are unavailable to users because of a failure or normal downtime maintenance.
Dual Card
Card with both debit and credit functionality.
TERM
DESCRIPTION
E-Commerce
Term used to describe business performed via the internet.
EFTPOS
Acronym for electronic funds transfer at POS. Also used to describe the terminal that supports EFTPOS.
Electronic Cash Register (ECR)
A device used for cash sales. Can also be integrated to accept credit cards.
Electronic Date Capture (EDC)
Process of electronically authorizing, capturing and settling a credit card transaction.
Emboss
The process of printing identifying data on a card, in the form of raised characters.
Emergency Card Replacement
An optional service that issuers can offer their cardholders, in order to replace a lost or stolen card.
EMV cards
An EMV card is the one that meets the standard for chip-bearing cards. The acronym of Europay (now MasterCard Europe), MasterCard, and Visa (EMV), three processing firms that in 2002 first agreed to the standards.
Encryption
The technique of modifying a known bit stream on a transmission line so that it appears to be a random sequence of bits to an unauthorized observer. It often is done automatically in the terminal or computer before data is transmitted.
Expiration Date
The date (month and year) when the card expires. The card is valid until the last day of the month indicated. Also referred to as the expiry date.
TERM
DESCRIPTION
Face-to-Face Transaction
A transaction where the card, the cardholder, and the merchant representative are all present at the time of the transaction.
Fallback
Term used to describe the situation where a chip card is used in a chip terminal, but the chip technology could not be used. In such cases, the transaction falls back (reverts) to the magnetic stripe technology.
Fee Waivers
Discount on regular joining or membership fees. Example: Fee waivers could be 10% or any other percentage of discounts for first year or for all years.
Float
The money earned by the issuer during the time between the prepayment of an amount on a card and the spending of the amount.
Floor Limit
Financial limit for offline transactions: for amounts that are equal to or below the floor limit, no authorization is required.
Footer
Text printed at the bottom of a sales draft. A merchant can customize the footer (eg. Have a Nice Day, Thank You for Shopping With Us, etc.).
Fraud
A deception deliberately practiced to secure unlawful gain.
Fraud Activity
Transaction that an issuer reports as fraudulent when either a: • fraudulent user used a card or its account number • card was obtained through misrepresentation of identification or financial status.
TERM
DESCRIPTION
GCMS
Global Clearing Management System: a centralized clearing facility owned and operated by MasterCard for the daily processing and routing of financial transactions between MasterCard and its members.
Grace period
Time during which cardholders are allowed to pay credit card bill without having to pay interests. It usually applies only to new purchases.
TERM
DESCRIPTION
Hologram
One of the security features that may appear on a credit card. The hologram may be displayed on the front or on the back of the card, or it can be replaced by a Holomag.
Holomag
A holographic magnetic stripe, one of the security features that may appear on a credit card.
Host System
The computer system that operates authorization and/or settlement functions for a processing centre.
Hot Card
A card being used on an account on which excessive purchasing is taking place. This may indicate a lost or stolen card or other unauthorized purchasing.
Hybrid Card
Term identifying: a) a card that supports both magnetic stripe and chip, b) a card with two chips - contact and contactless, c) a card with both debit and credit functionality (see also Dual Card).
Hybrid Terminal
A terminal that supports both magnetic stripe and chip.
TERM
DESCRIPTION
Identity Theft (IDT)
The misappropriation of elements of personal information of another individual for the purpose of assuming that individual’s identity with the intent to commit fraud.
Imprinter
A machine that takes an imprint of the embossed card details. Also known as zip-zap machine.
Inbound spending
Domestic spending
Integrated Circuit Card (ICC)
An International Organization for Standardization (ISO) standard card with an embedded integrated circuit chip. Also called an EMV chip card.
Interchange
The exchange of transaction data between acquirers and issuers.
Interchange Fee
A fee applied to an interchange transaction, applicable to the two members participating in the transaction as issuer and acquirer.
International Transaction
Transaction where the issuer of the card used is not located in the transaction country.
Introductory rate (or Intro APR)
Introductory annual percentage rate (APR) is a low rate offered by a credit card company as an incentive to apply for the card. It goes up after the introductory period is over. Also known as the teaser rate.
Issuer
Any entity authorized to issue a card and to engage in the card issuing business.
TERM
DESCRIPTION
Joining fee
The amount paid by the cardmember when his application form for a card is accepted. Also known as Initial Fee or Enrolment Fee.
TERM
DESCRIPTION
Key
A sequence of symbols that control the operation of a cryptographic transformation.
Know Your Customer
Activities that financial institutions and other regulated companies must perform to ascertain relevant information from their clients in order to prevent identity theft, financial fraud, money laundering and terrorist financing.
TERM
DESCRIPTION
Lifestyle Card
Term used to describe a card that appeals to a cardholder by relating to a lifestyle choice.
Line of credit
The most a cardmember can borrow under a revolving credit arrangement with a card issuer. When borrowing against a line of credit, cardmember pays interest on the amount of money he actually borrows, not on the available balance, or full amount you are able to borrow.
Load
Adding a sum of money onto a prepaid card.
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Lost Card Fraud
A fraudulent transaction that occurred when a cardholder loses a card.
Loyalty Card
A card designed to reinforce the relationship between a merchant and its customers, by providing the customer with some kind of benefit (points, miles, cash back, etc.). These cards are designed to encourage regular use of the card.
Loyalty Program
A marketing program, usually offered by financial institutions to cardholders or by merchants or retailers to customers, that rewards regular card use or frequent purchases.
TERM
DESCRIPTION
Magnetic Stripe (magstripe)
A magnetically encoded stripe, on the reverse side of a card, which contains information about the card, cardholder and account. The information contained on the magnetic stripe is sent to the issuer in an authorization request, along with other data needed to allow the issuer to approve or decline a transaction.
Mail/Telephone Order Transaction (MOTO)
A transaction conducted by mail or telephone, whereas neither the card nor the cardholder is present at the merchant outlet.
Mandate
Formal authoritative command setting out instructions to card issuer and/or acquirer.
Manual Close
A batch close that must be initiated by the merchant on a daily basis, as opposed to an auto close at a pre-set time.
Manual Imprint
An imprint of the embossed data on the front of the card taken with a manual imprinter.
MasterCard
Global bank card payments brand and network that provides its services to banks. Through thousands of financial institutions, it markets a wide portfolio of brands and products, offering a network of more than 24 million acceptance locations worldwide. It does not manage the relationships with the cardholders and merchants.
m-Commerce
Term used to describe business performed via a mobile phone.
Merchant
A retail outlet or organisation that has signed with an acquirer to accept cards.
Merchant ID Number (MID)
Unique number assigned by the acquirer to identify the merchant. MID is defined by combination of merchant location and card brand, and is used to identify the merchant during processing of daily transactions, rejects, adjustments, chargebacks, end-of-month processing fees, etc.
Minimum Repayment Amount (MRA)
Minimum repayment amount means minimum monthly charged amount that should be paid, for example 5% of used credit. Formula needs to answer which transactions are included in amount that should be charged and paid as MRA as well as transactions that should be charged and paid only at once. For example: POS transactions could be revolved and paid as MRA, but ATM transactions, fees, regular and penalty interest should be charged and paid at once (charged directly, not included in credit).
Multi-Application Operating System (MULTOS)
An open, high security, multi-application operating system for EMV chip cards. It enables credit, debit, electronic, cash, loyalty, and proprietary products to be held on one EMV chip card simultaneously, separately, and securely, while allowing the products to be platform independent.
TERM
DESCRIPTION
Natural PIN
PIN assigned by the issuer (opposite to a customer selected PIN).
Near Field Communications (NFC)
A short-range high frequency wireless communication technology which enables the exchange of data between devices over about a 10 centimeters apart.
Network
Company and system used to authorize and capture credit card transactions.
Neural Network
Term used to describe a fraud detection tool that uses powerful data modeling capabilities identify fraudulent transactions, even those that do not fully match known fraud patterns.
Non–Face-To-Face Transaction
A transaction where the card, the cardholder, and/or the merchant representative is not present at the time of the transaction. Examples: mail order, telephone order, cardholder-activated terminal (CAT), electronic commerce. See also: Card Not Present
Noninterchange
A transaction occurring through an institution that is both the issuer and the acquirer.
Not-on-us
Term used to describe the situation where the issuer and the acquirer of the transaction are not the same financial institution.
TERM
DESCRIPTION
Offline
An operating mode in which a card acceptance device is not connected to a central computer source. Responses are governed by the parameters or guidelines set within the terminal or supporting device as defined by the issuer or card scheme.
On Us
Term used to describe the situation where the issuer and the acquirer of the transaction are the same financial institution.
Online
An operating mode in which a card acceptance device is connected to a central computer system and has access to the database for authorization, inquiry, and file changes. Live files are accessed for each transaction.
Open-To-Buy
Term used to describe the amount of money that the cardholder still has available on the credit line.
Outbound spending
International spending
Over limit (overloc)
Being over-limit refers to a cardholder account that has surpassed its credit limit with a transaction.
Overdraft
An extension of credit to supplement a cardholder’s asset account.
Over-The-Limit Fee
A penalty fee charged by the issuer to a cardholder that exceeds the credit line assigned to the card.
TERM
DESCRIPTION
Password
A sequence of characters that allows users access to a system. Although they are supposed to be unique, experience has shown that most people’s password choices are highly insecure. Humans tend to choose short words, such as names, which are easy to guess.
Pay Later
Synonym for credit cards.
Pay Now
Synonym for debit cards.
Payment Card (Product)
Term used to describe any type of card (prepaid, debit or credit) used to purchase goods or services.
Payment Gateway
A system that provides electronic commerce services to merchants for the authorization and clearing of secure electronic transactions.
Payment Scheme
Term used to describe the entity offering payment product and services. A bank or any other eligible financial institution can become its member by entering into one or more license agreements, thus getting the possibility to issue or acquire the transactions performed within the scheme.
PayPass
Type of payment system allowing shoppers to pay for low-value goods by touching their debit or credit card against an electronic reader.
PCI DSS
Payment Card Industry Data Security Standard. The standard provides an actionable framework for developing a robust account data security process – including preventing, detecting and reacting to security incidents. It is intended for any organization that stores, transmits or processes cardholder account and transaction data – merchants, acquiring banks, and related service providers.
Peak Hour
The hour in which the maximum volume, capacity, system load, or processing has taken place.
Per Transaction Fees
Fees paid by the merchant to the merchant bank or other contracted party on a per-transaction basis.
Person To Person (P2P)
Term used to describe commercial activities between one person and another.
Personal Identification Number (PIN)
A secret code, known only by the cardholder, which allows the issuer (or its agent) to verify the cardholder.
Personalization
Term used to describe the process where cardholder details (name, PAN, expiry date) are put onto a card.
Pharming
Term used to describe a hack attack where one website's traffic is redirected to another website, controlled by the criminal.
Phishing
Term used to describe a hack attack where a criminal creates a web site or pop-up screen that appears to be legitimate, and encourages the cardholder to provide critical data (such as the PAN, expiration date, CVC2, PIN, etc).
Point Of Interaction
Term used to describe the point where the card and the ‘terminal’ (POS terminal, PC, etc) come together.
Point of Sale (POS)
The location at the card acceptor's premises at which a sale is completed.
Point of Transaction
The physical location where a merchant or acquirer (in a face-to-face environment) or an unattended terminal (in an unattended environment) completes a transaction receipt.
Point-Of-Sale (POS) Terminal
An attended or unattended access device located in or at a card acceptor’s (merchant’s) premises that permits the effecting of a transaction for the purchase of goods or services sold by the merchant. A POS terminal is connected to the acquiring financial institution’s system through telecommunications lines and is designed to capture and forward transaction information by electronic means.
Posting
The process of updating individual cardholder account balances to reflect merchandise sales, instant cash, cash advances, adjustments, payments and any other charges or credits.
Pre-approved card
A conditional coffer for a card from a card issuer based on a pre-qualification of the individual’s credit.
Pre-Authorization
An authorization is the first part of a two stage transactional process. An authorization verifies that a card is valid and has sufficient funds to complete this transaction.
Pre-Authorization Request
A real-time message sent by a merchant to request approval for an estimated transaction amount, because the final transaction amount will only be known some time later. This type of message is sent for transactions such as car rentals, hotel rooms and petrol.
Premium Card
Term used to describe exclusive cards that offer unique benefits to high net worth cardholders.
Prepaid Card
A card that stores value and is used to pay for goods or services, and in some cases, to procure cash disbursements.
Presentment
The message sent by the acquirer to provide information to the issuer about a transaction that took place.
Primary Account Number (PAN)
A unique series of numbers, assigned by the issuer, to identify an individual cardholder account. The PAN comprises: major industry identifier, BIN, cardholder account number, check digit.
Prime
Term used to describe customers that represent a low risk, and are therefore part of the preferred target customer segment.
Prime Rate
The interest rate at which banks lend to their most credit worthy (prime) customers. The prime rate is known to change but not on a regular basis.
Printed Card Security Code (PCSC)
A 3-digit number printed on the back of the Card (3CSC) or a 4-digit number printed on the front of the Card (4DBC/4CSC).
Private Key
In public-key cryptography, the half of a public-key/private-key pair that is known only to the encoder that resides on the user’s system.
Private Label Card
A card issued by a merchant that can only be used in the issuing merchant's stores.
Processing Fee
Compensation paid by issuers or acquirers to a financial network organization for processing interchange transactions according to the business agreements established by that financial network.
Processor
An organization that provides services associated with processing of card transactions between merchants, payment card issuers, and merchant account providers.
Procurement/ purchasing card
Charge cards used by businesses to cover purchasing expenses, such as raw materials or office supplies.
Promotion Code
A code assigned by the issuer to identify transactions that apply to a promotional program run by the issuer to encourage card use.
Proprietary
Owned by a private individual or corporation under a trademark or patent.
Provisioning
Term used to describe the accounting process of estimating the amount of debts that are likely to be written off by the issuer.
Public Key
In public-key cryptography, the half of a public-key/private-key pair that is known to the public and can be used to decript messages that were encoded by correspondent private key.
Public Key Certificate
A system that uses two mathematically related keys. The keys are referred to as the public key and the private key. The sender of the communication sends the public key to the receiver so that the message can be decrypted.
Purchase
A financial transaction, if approved, in which funds are debited from an issuer and credited to an acquirer in payment for goods or services.
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DESCRIPTION
Quasi-Cash
Term used to describe items that are directly convertible to cash, such as: gaming chips, money orders, opening deposits, wire transfer money orders, etc.
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Real-Time Gross Settlement (RTGS)
An online system for settling transactions of financial institutions within a country, or group of countries using the same currency. Eg. for the euro, the RTGS system is called TARGET2.
Real-Time Processing
Real-Time Processing means that when a web site's customer conducts an online purchase, that the check or payment card information is conveyed to the processor at that exact time so that an authorization can be requested and received at that moment. Real-Time Processing always implies that a Secure Payment Gateway is being utilized, whether proprietary or third party.
Receipt
A hard copy document that records when a transaction took place at the point of sale. The receipt contains a description of the transaction, which usually includes the date, the merchant name/location, the primary account number, the amount and the reference number.
Reconciliation
Process by which settlement payments are balanced against amounts and totals as provided by the association’s processing systems.
Record of Charge (ROC)
In American Express terminology, receipt for a cardmember's card transaction containing the details of any transaction carried out at an ATM or at the POS. The form the ROC may take depends upon the method and equipment used to capture the details of the card and transaction (eg. an imprinted form, which carries an imprint of the raised letter and numbers on a Card, plus the handwritten transaction information recorded by the merchant and cardmember's signature; a paper receipt printed by a POS device printer and signed by the cardmember; log entries made when an ATM dispenses cash). Same as: Record of transaction.
Record of transaction
Information pertaining to a transaction.
Recovery
Term used to describe the set of actions taken to obtain payment for amounts due (often referred to as ‘outstandings’ or ‘receivables’) from cardholders whose debts are no longer on the issuer’s accounting books.
Recurring Payments
Payments by an issuer to an acquirer on behalf of a cardholder who authorizes a merchant to bill the cardholder’s account on a recurring basis (such as monthly or quarterly). The amount of each payment may be the same or may fluctuate.
Refer To Card Issuer Transactions
A response to an authorization request generated by an issuer or through stand-in processing, requiring the acquirer to contact the issuer directly.
Reference Number
Number assigned to each monetary transaction in a descriptive billing system. Each reference number is printed on the monthly statement to aid in retrieval of the document, should it be questioned by the cardholder.
Referral
A response by an issuer to an acquirer’s authorization request asking that the acquirer call the issuer to facilitate the issuer’s decision whether to authorize or decline a transaction. See also: Call Referral
Refund
Opposite of a purchase transaction, namely, the cardholder returns goods to the merchant and is credited for their value. Positive interchange and merchant service charge are reversed.
Reject
Response to the acquirer to indicate that the transaction is not valid.
Relationship Card
A chip card that provides cardholders access anytime, anywhere, to multiple services and products, both financial and non-financial. The relationship card will allow financial institutions to differentiate their products and services in their markets.
Remote Stand-In (RSI)
A network service that provides authorization services to the issuer via a remote system, based on remote system parameters, when the host system is unavailable.
Renewal
Subscription or membership that is being renewed at expiration or renewal time.
Response
In EMV chip card processing, a message that the terminal receives from the EMV chip card after the EMV chip card processes the terminal’s command message.
Reversal
A message informing the receiver that the sender has canceled a previous record.
Revolver
An credit card issuer term for customers who pay their balances off over time, thus “revolving” their balances.
Revolving Credit Card
A card for which only a predetermined percentage or minimum amount, rather than the full amount, of the outstanding balance is required to be paid by the cardmember each month, with interest being charged on the unpaid balance on such account.
Routing
The directional flow of messages by which the acquirer and issuer communicate with each other directly or through intermediate network facilities, which may act as an agent for the original parties involved in the message flow.
Rules-Based System
Term used to describe a fraud detection tool that identifies transactions corresponding to known fraud patterns, translated into ‘rules’ (e.g. transactions above 150 EUR at an adult website).
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DESCRIPTION
Sales Draft (Ticket)
A form showing an obligation on the cardholder's part to pay money (i.e., the sales amount) to the card issuer. This is the piece of paper that is signed when making the purchase. Sales draft data can be captured electronically and sent to be processed over the phone lines. Also see: Electronic Data Capture
Scoring
The process of evaluating the characteristics of a person (age, marital status, home ownership, etc.) in order to assess risk. Used by issuers to determine the credit worthiness of a potential new cardholder.
Secure Payment Gateway
Secure Payment Gateway companies help other processors conduct secure business on the internet using Secure Socket Layer (SSL) technology. They provide a system that passes credit card data, authorization requests, and authorization responses over the internet using encryption technology.
SecureCode
MasterCard solution to secure e-commerce transactions.
Segmentation
Process of creating various types of card offerings and matching them to the relevant target group of cardholders.
SEPA Cards Framework
The high level principles and rules designed to enable European customers to use general purpose cards to make payments and cash withdrawals in euro throughout the SEPA area with the same ease and convenience than they do in their home country.
Service Establishment (S/E) (also: Merchant or Card Acceptor)
Person that has entered into a contract with an acquirer wherein such entity agrees to: • permit a cardmember to charge purchases of goods and services at or from such entity by card and • transfer such charges to an acquirer.
Settlement
The reporting of settlement amounts owed by one member to another, or to a card issuing concern, as a result of clearing. Settlement is the actual buying and selling of transactions between the merchants, processors and acquirers; along with the card-issuing entities.
Settlement Amount
Net amount in payment currency required to complete the member’s net settlement obligation for the value date.
Shoulder Surfing
Term used to describe the process whereby a criminal looks over a person’s shoulder and illegally obtains a cardholder’s PIN.
Side Card
See: Companion Card
Signature Based Transaction
Term used to describe transactions where the cardholder is validated by means of signature.
Skimming
Term used to describe the process whereby a criminal illegally obtains the magnetic stripe data from a genuine card. The data thus obtained is then transferred onto a counterfeit card and used to perform fraudulent transactions.
Smart Card
A plastic card containing a computer chip with memory and CPU capabilities. Such a card may be used for identification or to store information, financial amounts or other forms of data. Also called an integrated circuit card (ICC) or a chip card.
Split Tender Transaction
Term used to describe a transaction where part of the amount is paid using a prepaid card and the remainder is paid in cash.
Stand-in Processing (STIP; SIP)
One of the authorization services designed to process authorization requests on the issuer’s behalf.
Statement
A written record prepared by a financial institution, usually once a month, listing all transactions for an account, including deposits, withdrawals, checks, electronic transfers, fees and other charges, and interest credited or earned. The statement is usually mailed to the customer (also known as a billing statement).
Statement - merchant
Information sent to the merchant's head office about all authorized and processed transactions in a given period of time.
Statement Insert (Stuffer)
A document that is sent to the cardholder in the same envelope as the periodical statement. Usually contains special advice for the cardholder, or publicity.
Stolen Fraud
A fraudulent transaction that occurred when a card was stolen and subsequently used.
Store Card
Card associated with a particular retailer or group of retail stores that can be used only for purchases from that retailer or group of stores. See also: Private Label Card
Stored Value Card (SVC)
A chip card capable of storing a prepaid monetary value that can be used to pay for small transactions.
Sub-Prime
Term used to describe customers that represent a relatively high credit risk.
Supplementary (Additional) Cardmember
A cardmember who is issued a card based upon an account established by another cardmember, at the request of that other cardmember.
Suspect Activity
A transaction completed the day of, or subsequent to the day that, the account number was listed on the exception file with a pickup response.
TERM
DESCRIPTION
Terminal
Equipment used to capture, transmit and store credit card transactions.
Terminal Identification Number
A unique number assigned to identify each point-of-sale terminal.
Time-Out
Situation where a terminal terminates a transaction because the response was not received within the required timeframe.
Transaction
An action between a cardholder and a merchant or a cardholder and a member that results in activity on the cardholder account.
Transaction Fee
A fee charged by the acquirer for transaction activity at one of the acquirer’s terminals.
Transaction Information Document (TID)
Term used for transaction documentation, such as formsets, records, sales slips, terminal receipts, and record of charges.
Transaction Processing (T/P)
A processing technique using online control programs and a remote terminal network so that inquiries and applications against a prestored database can be performed at any processing site where the data is stored.
Transaction Routing
The method by which VisaNet decides which transaction needs to be sent to which Member using BIN routing tables.
Transactor
Term used to describe a cardholder that pays the full amount due on a credit card by the payment date, and thus does not accrue interest.
Travel & Entertainment (T&E) Cards
Credit or charge card used by businesses for travel and entertainment expenses. Examples of these cards are American Express, Diners Club, Carte Blanche and JCB.
Truncation
Term used to describe the process where part of a set of data is either deleted or replaced by other characters. For example, on ATM receipts, a number of characters must be replaced by other characters, such as asterisks.
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DESCRIPTION
Unattended Terminal
A POI terminal where a cardholder performs all payment functions with a card and without the presence of a merchant representative, such as at an automated fuel dispenser.
Underbanked / Unbanked
Term used to describe people that have access to limited banking services. Examples include people having no fixed address, stable income and/or having no relationship to a bank.
Unsecured Card
Term used to describe a card that does not require a cash deposit or any other collateral from the cardholder.
Uptime
The time when a user accesses network or computer resources; the time between failures or nonavailability periods.
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DESCRIPTION
Valid Date
A date embossed on the card after which the card must be honored. This date is used in conjunction with the required expiration date.
Value-added Services
Financial and non-financial services that add value to the card by increasing the number of ways it can be used and/or by increasing the amount of information it can store.
Variable Interest Rate
With variable-rate cards, the APR changes when interest rates or other economic indicators change. Also known as a floating rate.
Virtual Account (Non Plastic Account)
Special type of current account that involves virtual card is used exclusively for e-commerce. Bank issues all the elements that would be normally printed on the card but this card product does not imply actual plastic. All the data is communicated to customer who uses it only for e-commerce i.e. Internet payments.
Visa
Global payments technology company and large processing network. Just as MasterCard, Visa does not issue cards, extend credit, set rates and fees or manage the relationships with the cardholders and merchants, but enable its bank customers to offer consumers payment choices. Global bank card payments brand and network that provides its services to banks. Through thousands of financial institutions, it markets a wide portfolio of brands and products, offering a network of more than 24 million acceptance locations worldwide.
Voice Authorisation
Approval response obtained through interactive communication between an issuer and an acquirer, their authorising processors, or stand-in processing, through telephone, facsimile, or telex communications.
Void Transaction
A deletion of the transaction information.
Void(ed)
Nullifies a transaction that has been recorded for settlement, but has not yet been settled. This removes the transaction from the batch of transactions to be settled.
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DESCRIPTION
White Plastic
A counterfeit card that does not bear any graphical features at all, and therefore does not attempt to appear to be a genuine card. Such cards typically contain skimmed data on the magnetic stripe.
Working Key
Cryptographic key used to encipher and decipher PINs (sometimes referred to as PIN encipherment).
Write-Offs
Term used to describe the account process whereby an issuer indicates a cardholder debt as being uncollectible, and thus writes the debt off the issuer’s accounting books.
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Zero-Floor Limit
Floor Limit with a currency amount of zero (meaning authorization is required for all transactions).