|
Automated Clearing
House (ACH)
The automated "bank" that transfers electronic funds into and out of
the merchant's bank account.
Authorization
The permission of the issuing Bank to accept a credit card for
payment.
Authorization
Code
The code sent by the issuing Bank in response to an authorization
request to indicate that a credit card can be accepted as payment.
Authorization
Fee
A fee charged by Credit Card Processor for every response a merchant
receives through a terminal.
Authorization
Request
A request sent to the issuing Bank by the
merchant for approval to accept a card for payment.
Average Monthly
Volume
Total amount of sales for the year divided by 12
months.
Average
Ticket
Total net merchant sales divided by the number of
transactions.
Address Verification
Services (AVS)
When a card is not swiped, the address must be verified to combat
possible fraud. This feature is used primarily by mail or telephone order merchants but can be used
by retail merchants when a card cannot be swiped. A prompt appears on the terminal asking the
merchant to enter at least the Zip Code of the Cardholder so that the address can be verified.
Complete AVS is a service that verifies the Cardholder's billing address.
Charge
Back
When a Cardholder disputes a charge, the issuing Bank charges the
amount of the charge back to the merchant until the dispute is settled.
Clearing
The exchange of financial transaction
information.
Closing
The sending through the interchange of the credit card transactions
accumulated by the merchant in the terminal or Host so the merchant can be paid for
them.
Data
Capture
The collection, formatting, and storage of information in computer
memory.
Demand Deposit Account
(DDA)
The bank checking account to which the merchant's
deposits are made or funds debited.
Discount
Rate
The fee charged by Credit Card Processor to a merchant for processing
credit card transactions. Also called "Discount Fee," "Base Rate or Fee," "Monthly Rate or Fee," or
Just "Rate" or "Fee."
Electronic Draft Capture
(EDC)
Sending the information about each credit card
transaction to the issuing Bank electronically through the point of sale
terminal.
Interchange
Fees
The fees deducted from the transaction amount by the issuing Bank to
cover the cost of the process. The Acquirer pays the net amount to the Issuing
Bank.
Japanese Credit
Bureau (JCB)
A credit card issued in Japan that has become more widely accepted in
the United States in recent years due to the growing number of Japanese business people traveling
and working here.
Merchant Category
Code (MCC)
Code used by MasterCard to identify what a merchant
sells.
Merchant
File
A file used by the Acquirer to list pertinent information on its
merchants.
Merchant Identification
(MID) Number
Each merchant is assigned a unique identification
number that is used in all Processing systems to locate information concerning the merchants and
their accounts.
Merchant Processing
Agreement (MPA)
A signed contract between the merchant and the
credit card processor that outlines the responsibilities of the processor and the merchant in the
credit card transaction process.
Merchant
Qualification Standards
The minimum standards established by MasterCard and VISA for merchant
acceptance that requires the merchant to be financially responsible and of good
repute.
Minimum Discount
Fee
The minimum discount fee a merchant agrees to pay each month based on
his or her expected sales volume. The Credit Card Processor will charge the merchant the actual
amount of fees generated or the minimum discount fee, whichever is
greater.
MO/TO
Mail Order/ Telephone Order.
Non-Qualified
Rate
The discount rate level, at which the transaction qualifies when it
did not meet any of the qualifications for the other lower rates. All paper merchants will qualify
at this level, as will all business cards.
Off-Line
Sale
Allows the merchant to enter a transaction if unable to process under
the regular sales key. Also called a Force of Post Auth.
Off-Line Debit
Card
A debit card that does not deduct funds from the checking account
immediately. Transactions are processed like a regular credit card and funds are not deducted for
24-72 hours. No Personal Identification Number (PIN) is needed to process the
transaction.
Partially Qualified
Rate
The discount rate level at which the transaction
qualifies when it did not meet all requirements for the best (lowest) rate but met more requirement
than needed to qualify for the Standard (highest) rate.
Per-Transaction
Fee
A fee that can be charged to a merchant for each transaction that is
processed.
Personal
Identification Number (PIN)
A number that must be entered by the customer before an ATM will
allow access to the customer's bank accounts. Also used at a retail establishment when a customer
pays for a purchase with an ATM or on-line debit card.
Posting
The process of recording charges and credits to the Cardholder's
account.
Processing
The procedure by which the merchant sends the information about each
credit card transaction to the issuing Bank so that the Issuing Bank can pay the merchant for the
transactions.
Qualification
Level
Each transaction is assigned a Qualification Level at interchange.
The level assigned depends on how well the transaction met the requirements for the merchant's
industry. For example, for a retail merchant's transaction to be assigned the Qualified level, the
card must be swiped, the terminal must be settled each day, and all other criteria for that level
must be met.
Qualified
Rate
The discount rate level, at which the transaction qualifies when it
met all requirements for the best (lowest) rate.
Settlement or
Settling
The sending through the interchange of the credit
card transactions accumulated by the merchant in the terminal or Host so the merchant can be paid
for them.
Swipe
Running a credit card's magnetic stripe through a reader that
interprets the data encoded on it.
Terminal
Based
Software through which transactions are stored in the terminal until
settlement.
Terminal
Identification (TID) Number
The unique number assigned to each point of sale terminal that tells
the Credit Card Processor which merchant a transaction came from and where an authorization is to
be sent.
Terminal
Provider
A company that supplies credit card hardware and software to a
merchant.
Third-Party
Processor
A non-member agent contracted by a member to provide authorization,
processing, and merchant services.
Transaction
Any action between a Cardholder and a merchant or member that results
in activity on the account, such as a purchase, cash advance, debit or credit adjustment,
etc.
Visa
A national association, member-owned and governed by a board of
directors, that licenses its members to issue VISA cards and accept VISA sales drafts. VISA owns
and operates an international processing system and provides a number of various services to its
members, Cardholders and merchants.
Retail &
Restaurant
------------------------------------------------------------------------------------------------------------------------------------------------
Qualified Transaction
Conditions
- The card is present, the
full magnetic stripe is read by the terminal, and a signature is
obtained
- One electronic authorization request is made
per transaction and the transaction/purchase date is the same as the authorization date. The
authorization code must be included in settled transaction (this is done automatically by the
Credit Card Processor terminal application).
-The authorized transaction amount must match the
settled (deposit) transaction amount, except for restaurants, where the transaction amount must be
within 20% of original authorized amount.
-Additional data is required in the settled
transaction on all Purchasing and Commercial cards at non-T&E locations. (Purchasing Card -
customer code and sales tax; Commercial Card - sales tax)
-The transaction must be authorized and settled
under a retail standard industry code.
-The transaction must be electronically deposited
(settled) no later than 1 day from transaction/purchase date.
--------------------------------------------------------------------------------------------------------------------
-VISA calls this qualification level CPS Retail.
-MasterCard calls this qualification level Merit
III.
(There can be other names for this qualification
level depending on what type of card was used or how it was accepted but these are the most
common.)
--------------------------------------------------------------------------------------------------------------------
Partially Qualified Transaction
Conditions
One or more of the Qualified
conditions were not met.
OR => The transaction was electronically
deposited (settled) more than 1 day but within 2 days of the transaction/purchase
date.
-VISA calls this qualification level CPS Card Not
Present or EIRF. It is CPS Card Not Present if the only condition not met was that the card was not
swiped. It is EIRF is one or more conditions were not met other than the card not being
swiped.
-MasterCard calls this qualification level Merit
I. (Certain types of merchants may see Key-Entered if the only condition not met was that the card
was not swiped but only a small number of merchant types are eligible for Key-Entered rates.)(There
can be other names for this qualification level depending on what type of card was used or how it
was accepted but these are the most common.)
Non-Qualified
Transaction Conditions
One or more of the Qualified or Partially Qualified conditions were
not met.
OR => The transaction was electronically
deposited (settled) more than 2 days from authorization date.
OR => Commercial card, World MasterCard, or
Visa Signature card accepted at a T&E location.
OR => No additional data in the settled transaction on Purchasing
and Commercial cards at non-T&E locations. (Purchasing Card - customer code and sales tax;
Commercial Card - sales tax).
OR => Visa Infinite card accepted.
OR => Transaction was not electronically
authorized (voice authorization) or the authorization code was not included in settled
transaction.
VISA and MasterCard both call this qualification
level Standard.(There can be other names for this qualification level depending on what type of
card was used or how it was accepted but these are the most common.)
--------------------------------------------------------------------------------------------------------------------
Mail Order / Telephone
Order
--------------------------------------------------------------------------------------------------------------------
Qualified Transaction Conditions
-One electronic authorization request is made per transaction and the
transaction date is the same as the shipping date. The authorization code must be included in
settled transaction (this is done automatically by the Credit Card Processor terminal
application.)
-The authorization request message must include
Address Verification Service (AVS).
-The transaction/shipping date must be within 7
calendar days of the authorization date.
-The authorized transaction amount must match the
settled (deposit) transaction amount.
-The settled transaction data must include the
merchant's customer service telephone number, the order or invoice number, and the total authorized
amount.
-Additional data is required in the settled
transaction on all Purchasing and Commercial cards at non-T&E locations. (Purchasing Card -
customer code and sales tax; Commercial Card - sales tax)
-The transaction must be electronically deposited (settled) no later
than 1 day from transaction/purchase date.
-VISA calls this qualification level CPS Card Not
Present.
-MasterCard calls this qualification level Merit
I.(There can be other names for this qualification level depending on what type of card was used or
how it was accepted but these are the most common.)
Partially Qualified
Transaction Conditions
One or more of the Qualified conditions were not
met.
OR => The transaction was electronically
deposited (settled) more than 1 day but within 2 days of the transaction/shipping
date.
-VISA calls this qualification level EIRF.
MasterCard does not recognize this qualification level.
Non-Qualified Transaction Conditions
One or more of the Qualified or Partially
Qualified conditions were not met.
OR => The transaction was electronically
deposited (settled) more than 2 days from authorization date.
OR => Commercial card, World MasterCard, or
Visa Signature card accepted at a T&E location.
OR => No additional data in the settled transaction on Purchasing
and Commercial cards at non-T&E locations. (Purchasing Card - customer code and sales tax;
Commercial Card - sales tax).
OR => Visa Infinite card
accepted.
OR => Transaction was not electronically
authorized (voice authorization) or the authorization code was not included in settled
transaction.
VISA and MasterCard both call this qualification
level Standard.(There can be other names for this qualification level depending on what type of
card was used or how it was accepted but these are the most common.)
|
