{"id":3841,"date":"2025-01-23T12:14:03","date_gmt":"2025-01-23T17:14:03","guid":{"rendered":"http:\/\/www.nationaltransaction.com\/credit-card-merchant\/?p=3841"},"modified":"2025-01-23T12:15:21","modified_gmt":"2025-01-23T17:15:21","slug":"payment-industry-terminology","status":"publish","type":"post","link":"https:\/\/www.nationaltransaction.com\/credit-card-merchant\/payment-industry-terminology\/","title":{"rendered":"Payment Industry Terminology"},"content":{"rendered":"

The acquiring bank<\/strong> (or acquirer also known as merchant bank) is the financial institution that processes credit or debit card payments on behalf of a merchant and maintains the\u00a0merchant\u2019s bank account. The contract with the acquirer enables merchants to process credit and debit\u00a0card transactions. The acquiring bank passes the merchant\u2019s transactions along to the applicable issuing\u00a0banks to receive payment.<\/p>\n

An acquiring bank<\/b> (or acquirer<\/b>) is a bank or financial institution that processes credit or debit card payments on behalf of a merchant. The term acquirer<\/b> indicates that the merchant accepts or acquires credit card payments from the card-issuing banks within an association<\/p>\n

The issuing bank<\/strong> is the financial institution that issues credit cards to consumers on behalf of the card\u00a0networks (Visa, MasterCard). The issuer acts\u00a0as the middle-man for the consumer and the card network by contracting with the cardholders for the\u00a0terms of the repayment of transactions.<\/p>\n

There are several situations where the credit card payment terminology deviates from the norm, making\u00a0certain concepts difficult to understand.<\/p>\n

For example, issuing banks generally manage cards on behalf of the networks.<\/p>\n

However, Discover and American Express<\/a> are both the card network and<\/em> issuing bank; the networks\u00a0have their own financial institutions issue the credit cards to consumers.<\/p>\n

Making things even more complex, some financial institutions are both acquirers and issuers. These\u00a0banks operate on behalf of both the consumer and the merchant. Bank of America, Citi Bank, Barclays,\u00a0Chase, and Wells Fargo are just some examples.<\/p>\n

Payment Industry Terms<\/h3>\n

The processor<\/strong> is an organization contracted with the acquirer to process the credit card transactions.<\/p>\n

The payment gateway<\/strong> is essentially the card-not-present version of the point-of-sale terminal. This\u00a0service provider relays transaction information from the merchant to the processor. The payment\u00a0gateway is responsible for acquiring transaction authorization and data encryption.<\/p>\n

Other third-party service providers used by card-not-present merchants include web hosting<\/strong>, SSL\u00a0certificates<\/strong>, shopping carts<\/strong> and more.<\/p>\n

The acquirer assigns a Merchant Identification Number<\/strong> (MID). This unique code is similar to a bank\u00a0account number. It\u2019s used to identify the merchant while processing transactions.<\/p>\n

 <\/p>\n

Understanding the Essentials<\/h3>\n

If you\u2019re struggling to master the confusing tasks and terminology associated with chargebacks<\/a>, your\u00a0management efforts won\u2019t be as effective as they should be. You\u2019re needlessly throwing away profits.<\/p>\n

Let us help. Not only do we offer a turnkey solution that handles the entire chargeback process<\/a> from beginning to end, we also make sure merchants are kept informed of the most essential elements that are affecting a business\u2019s financial success. Call 888-996-2273<\/a> Now for all your payment processing needs.<\/p>\n","protected":false},"excerpt":{"rendered":"

The acquiring bank (or acquirer also known as merchant bank) is the financial institution that processes credit or debit card<\/p>\n

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