3D Secure
3D Secure is an identity authentication step for online payments. This security feature is used by Visa (Verified by Visa), MasterCard (SecureCode), JCB International (J/Secure), and American Express (American Express SafeKey).
3 Easy Ways to Prevent Online Fraud

ABA Number (Routing Number)
The 9-digit sequence used to indicate bank locations in the U.S.

Account Number
A number that identifies a cardholder’s bank account.

Accounts Receivable Conversion (ARC)
A speedier process that scans paper checks and converts them into electronic payments through the Automated Clearing House (ACH).

Address Verification System (AVS)
A layer of security for online payments that verifies the address provided with the one on file with the bank.
3 Easy Ways to Prevent Online Fraud

Acquirer
Also known as an acquiring bank. An acquirer solicits, underwrites, and maintains the merchant account. They may provide the technology that allows the merchants to process transactions, take on chargeback risk of a business, and deposit funds into a merchant’s bank account.
What is a Merchant Account?
Fees: The Anatomy of a Digital Transaction
What You Need to Apply for a Merchant Account

Affinity Card
A credit card co-issued by a bank and charitable organization. Every time the card is used, a percentage of the transaction is donated to the organization and their logo appears on the card.

Aggregator
An aggregator is a payment service provider that allows merchants to accept payments without having to set up a merchant account. Aggregators are named so because your business is grouped together with other merchants in an aggregation and tracked individually. An aggregator accepts payments on behalf of merchants.
Why Your Growing Business Needs to Switch from an Aggregator
What is an Aggregator?

Altered Card
A card that has been compromised by altering the encoded information for fraudulent purposes.

Annual Fee
A payment processing membership fee that is charged every year until the contract is over.

American Bankers Association (ABA)
The trade association for the U.S. banking industry. They provide training and educational programs, information products, professional certifications, and technical services to its members.

Annual Fee
This fee is charged every year to cover the basic use of a provider’s services.

Application Fee
A one-time payment processing fee charged for processing the merchant account application.

Application Programming Interface (API)
A set of requirements that dictate how one application talks to another to perform a service.
Finally, One API for All Kinds of Payments
5 Reasons to Use the Payfirma Payment API for eCommerce
Payfirma Announces Beta for Bitcoin API

Apple Pay
Apple Pay is Apple’s digital wallet service. It is a contactless payment method accessible on compatible Apple devices. Apple Pay transactions can be made in-store or within apps.
Accepting Apple Pay in Canada
Apple Pay, eh?

Approval
The acceptance of an authorization request or simply put: when a purchase goes through.

Arbitration
The process where a merchant uses an arbitrator, an issuer or acquirer, to settle a chargeback dispute. The card brand reviews the facts and comes to a conclusion.

Auto Representment
Chargebacks that were automatically resolved by the payment processor on a merchant’s behalf.

Authorization
The process by which a transaction is approved or declined by the issuer. Merchants use this to ensure a customer has sufficient funds available on their credit limit at the time the request is being made.

Automated Clearing House (ACH)
An electronic network for financial transactions in the U.S. The payment system processes large volumes of credit and debit transactions in batches and deals with direct deposit, payroll, tax refunds and payments, bills, vendor payments, and more.

Automated Teller Machine (ATM)
A machine that allows consumers access to their account without a teller. Using a bank card and PIN, clients can withdraw and deposit money, pay bills, and obtain bank statements.

Authorization Approval Code
5 or 6 numbers generated by an issuer when it approves a transaction.

Authorization Only
A special type of transaction that holds an amount on a customer’s card and settles the amount at a later time. Frequent uses occur in industries such as hotels (for check-ins) and restaurants (for tabs).

Average Transaction Size (ATS)
The average dollar amounts of each transaction. Businesses applying for a merchant account will have to provide their ATS because acquirers need to know normal processing volumes.
The Truth about Funding Delays

Bank Identification Number (BIN)
The first 4-6 digits of a credit card used to identify the bank that issued the card.

Bank Routing Number
The 9 digits at the bottom of a check that identifies the bank in a transaction.

Basic Credit Card
A no-rewards, no-points, basic credit card.

Batch 
An aggregation of captured sale transactions waiting to be settled, typically a single day’s worth.

Batch Processing
The submission of batches to the acquirer for settlement. Multiple batches may be settled throughout the day.

Billback Pricing Model 
A pricing model where a merchant pays one set rate for qualified cards then is billed another rate for all non-qualified cards in the next statement.

Billing Cycle
The period of time when statements are prepared for goods and services that a company has sold. A billing cycle is recurring, usually on a monthly basis.

Bitcoin
A popular form of cryptocurrency that is created and held digitally. Bitcoin is generated and regulated by a decentralized community of servers.
Bitcoin: A Beginner’s Guide
The New Kid on the Block(chain)

Blockchain
The blockchain works as a public ledger that permanently records every bitcoin transaction. The technology of blockchain is self-regulating and allows bitcoin to exist without a central bank. Each bitcoin transaction in the blockchain is verified by the community using cryptography.
The New Kid on the Block(chain)

Brick and Mortar
May also be referred to as bricks and mortar. A physical storefront that a business owns or rents.

Business to Business (B2B)
Business between companies.

Business to Consumer (B2C)
Business between business and consumer.

Cancellation Fee
This is a fee charged when some services are discontinued prior to contract end.

Capture
The collection of a previously authorized amount on a customer’s credit card.

Card Assessment Fee
See Card Brand Fee.

Card Association
Most commonly known as credit card and debit card companies. Their role is to govern compliance policies pertaining to the bank cards, monitor processing activity, develop new products, and oversee the clearing and settlement of transactions (Visa and MasterCard).

Card Brand
See Card Association.

Card Brand Fee
This is a small payment processing fee that is paid to Visa and MasterCard for each transaction.

Card Identification Number (CID)
The 4-digit card security code on the front of an Amex credit card.

Card Security Code (CSC)
A security feature that is often required in online transactions.
3 Easy Ways to Prevent Online Fraud

Card Not Present Transactions
Transactions where the physical card is not present at the time of the sale (online purchase or telephone order). Credit card data is manually entered instead of swiped.
3 Ways to Prevent Online Fraud
Card Present and Card Not Present Transactions

Card Present Transaction
Transactions where the credit card is present at the time of purchase (in-store purchases).
Card Present and Card Not Present Transactions

Card Phishing
A fraud method where scammers pose as a legitimate organization to obtain sensitive customer information.
Card Present and Card Not Present Transactions

Card Skimming
A fraud method where employees who have access to sensitive customer information copy (either manually or electronically) the data.
Card Present and Card Not Present Transactions

Card Verification Code (CVC2)
The 3-digit card security code on the back of a MasterCard credit card.

Card Verification Value (CVV2)
The 3-digit card security code on the back of a Visa credit card.

Cardholder
Consumers with credit cards that purchase goods. The cardholder will be approved for credit cards by the issuer based on credit worthiness.

Cardholder Account Number
The account number embossed on the payment card assigned to a cardholder account that identifies the issuer and type of payment card.

Chargeback
A return of funds to a consumer after they disputed a transaction. The customer requests the refund directly from the bank. Common chargeback reasons can be due to fraud, faulty goods or services, or technical errors (double charge). But more often than not, chargebacks are fraudulent, such as when a customer falsely reports they didn’t receive a package.
3 Ways to Reduce eCommerce Chargebacks
3 Ways to Avoid Subscription Billing Chargebacks
3 Ways to Prevent Online Fraud
How to Avoid Chargebacks

Chargeback Fee
The fee charged to the merchant by the acquirer for processing chargebacks.

Chargeback Reason Code
The code that identifies the specific reason for a chargeback. MasterCard and Visa have their own chargeback codes.

Check
An order for the transfer of money.

Chip Card
See Smart Card.

Churn
The rate that you are losing customers.
3 Ways to Avoid Subscription Billing Chargebacks

Clearing
The exchange of transaction information between acquirer and issuer in order to post and settle the amount.

Cost Plus
See Interchange Plus.

Counterfeit Card
A fake plastic card which has been made to appear real or a real card which has been altered.

Credit
A refund or price adjustment for a previous purchase.

Credit Card
A plastic card with a credit limit used to purchase goods and services.
8 Reasons to Accept Credit Cards
4 Things that Impact Accepting Credit Cards

Credit Card Associations
See Card Association.

Credit Card Fraud
Theft and fraud committed using or involving a credit card. It is either theft of the actual card or sensitive card information and then the use of either without the knowledge of the cardholder.

Cryptocurrency
A digital currency in which encryption techniques are used to generate and regulate the units of currency and verify the transfer of funds. It operates on a decentralized community of computers, independent of a central bank.
Bitcoin: A Beginner’s Guide
The New Kid on the Block(chain)

Data Encryption
When electronic data is converted into another form which cannot be understood by anyone without a key.

Debit
A charge to a customer’s account.

Debit Card
A plastic card that provides the cardholder electronic access to their bank account.

Decline
The denial of an authorization request.

Digital Wallet
See Mobile Wallet.

Discount Rate
The fee charged by your credit card processor and paid to a merchant bank in exchange for being able to accept credit cards. It is calculated on a per transaction basis and based upon the total amount of the transaction size.

Doing Business As (DBA)
The operating name of a company, rather than the legal name. For example, Payfirma is the doing business as name, but Payfirma Corporation is the legal business.
How to Avoid Chargebacks
What You Need to Apply for a Merchant Account

eCommerce
The sale and purchase of goods or services over the Internet.
5 Ways to Increase Your eCommerce Site’s Authority and Conversion
4 Opt-Ins to Accelerate the eCommerce Buyer Process
5 Rules to eCommerce Success
Secrets of Successful eCommerce Blogs
3 Ways to Reduce eCommerce Chargebacks
Platform: eCommerce

Electronic Banking
The use of computers to carry out banking transactions such as ATM withdrawals or in-store transactions.

Electronic Bill Payment
A feature of online, mobile, and telephone banking. It allows a customer to transfer money from their account to pay bills. Payment is typically initiated by the payer but can also be set up as a direct deposit (for paychecks).

Electronic Check (eCheck)
An electronic version of a paper check.

Electronic Check Acceptance (ECA)
The process that converts a paper check into an electronic check at the point of sale. The check is electronically processed through the ACH network, similarly to how credit cards are processed, and is returned to the consumer.

Electronic Draft Capture (EDC)
See Point of Sale.

Electronic Funds Transfer (EFT)
The electronic transfer of money from one bank account to another.
4 Reasons Customers Love Online Payment Options

Electronic Wallet
See Mobile Wallet.

Encryption
The method of encoding data, like a cardholder’s personal information, in such a way that only authorized parties can read it.

Enhanced Recover Reduced (ERR)
See Billback Pricing Model.

Europay, Mastercard, and Visa (EMV)
Also known as chip and pin. It is a global standard for credit and debit card payments based on chip card technology. EMV makes in-store purchases more secure.
Finsight: Know the Ins and Outs (and Taps) of EMV

Expiration Date
The expiry date embossed on a bankcard.

Financial Institution
Any organization that moves, invests, or lends money, and it also provides financial services (commercial banks, thrifts, federal and state savings banks, saving and loan associations and credit unions).

Financial Technology (Fintech)
Using software to provide financial services.

Fixed fees
A type of payment processing fees that is charged on top of the per transaction fees. They are the a fixed amount no matter what.

Flat Pricing Structure
A pricing model that has a fixed fee regardless of card type, business type, and transaction type. This is the fee structure for aggregators.

Fraud
When a customer does not initiate or has no knowledge of the transaction.
3 Easy Ways to Prevent Online Fraud

Funding
When a merchant gets paid after settlement

Hard Decline
A permanent decline; retries will likely yield the same results.

Independent Service Organization (ISO)
See Payment Processor.

Interac
National debit card network in Canada.

Interchange Fee
Interchange is what the acquiring bank pays to the issuing bank. Each type of credit card has a different interchange rate set by the card brands.
Fees: The Anatomy of a Digital Transaction

Interchange Differential Fee
A payment processing fee that is the difference between the interchange rate of a premium or non-qualified card (i.e. cash back credit card) and the interchange rate of a qualified card.

Interchange Differential Pricing Model
With this pricing model, you pay the qualified rate, the non-qualified fee (if it’s anything other than a basic card), the card brand fee, and the interchange differential fee.

Interchange Pass-through Model
See Interchange Plus.

Interchange Plus Pricing Model
A pricing model that consists of the interchange rate of the card plus a fixed percentage.

International Fee
This fee is applied when an international card is used for a transaction.

Issuing Bank
Also known as an issuer. A bank or financial institution that provides credit and a physical credit card to the customer. They are responsible for approving and declining transactions, billing, and collecting the owed funds from the customer.

Line Bust
Abolishing line-ups.
4 Reasons to Accept Mobile Payments

Line of Credit
The amount of credit extended to a borrower.

Liquidated Damages Fee
This is a type of early termination fee. It allows processors to recoup the cost involved with losing your contract.

Magnetic Information Character Recognition (MICR)
Imprinted banking numbers (bank routing and transit, checking account number and check number) encoded at the bottom of a check that can be used to authorize the check.

Magnetic Stripe
A stripe on the back of a payment card with magnetically encoded card information.

Magnetic Stripe Card
Also known as a magstripe card. A payment card with a magnetic stripe on the back.

Mail Order/Telephone Order (MOTO)
A type of card not present transaction in which services are paid for through phone, mail, fax, or the web.

Merchant
A company accepting payment cards in exchange for goods or services.

Merchant Account
A type of bank account provided by an acquirer that allows businesses to accept payments, typically credit, debit, and mobile payments.
What You Need to Apply for a Merchant Account
Why Your Growing Business Must Switch from an Aggregator

Merchant Account Provider
Can be either a payment processor or an acquirer.

Merchant Agreement
The written contract between the merchant and acquirer that details their respective rights, responsibilities, and warranties.

Merchant Bank
See Acquirer.

Merchant Category Code (MCC)
A four-digit number assigned to a business by credit card companies to identify the type of business. For example, 5661 is the MCC assigned to all shoe stores.

Merchant Discount
See Discount Rate.

Merchant Identification Number (MID)
A unique number issued by the acquiring bank to identify a merchant.

Method of Payment (MOP)
The way a merchant chooses to accept payment for products or services. (MasterCard, Visa, American Express, Discover, mobile, etc.)

Millennials
The cohort group born between the years 1980-2000. They are the first generation of “digital natives” and strong advocates of the evolving payment movement.
Infographic: How Millennials are Growing Mobile Payments

Mixed Rate
See Billback.

Mobile Payments
Payments accepted on a mobile device (with a swiper) or payments made by a mobile device (via NFC).
Infographic: How Millennials Are Growing Mobile Payments
4 Ways to Accept Mobile Payments
Grow Your Business with Mobile Payments Like Nordstrom and Sephora
25 Stats Prove Why Businesses Need to Accept Mobile Payments
Platform: Mobile

Mobile Wallet
An electronic device that allows an individual to make electronic transactions.
Accepting Apple Pay in Canada
What is NFC?

Monthly Fee
This fee may be charged each month for payment processing services.

Monthly Minimum Fee
A payment processing fee that is charged if certain transaction totals for the month or year is not reached.

Multichannel
Allowing customers multiple ways to pay.
Infographic: Multichannel Retailing
3 Reasons to Accept Multiple Payment Methods
3 Omni-channel Tips to Increase Sales

NACHA
NACHA manages the development, administration, and governance of the ACH network.

Near-Field Communication (NFC)
The technology that allows the transfer of information through radio waves when two enabled devices are in close proximity.
What is NFC?

Non-qualified Card
Any card that is not a qualified card.

Non-sufficient funds (NSF) fee: 
If you don’t have enough funds in your bank account to cover your merchant account expenses, you will be charged an NSF fee.

Omnichannel
Omnichannel refers to providing a holistic experience for the many ways consumers interact with you. For payments, this means providing multiple integrated methods for your customers to pay.
3 Omnichannel Tips to Increase Sales

Online Reporting Fee
This is charged to merchants who choose to view their statement online.

Payment Brand Network
See Card Association.

Payment Gateway
It facilitates the transfer of information between a payment portal (website, mobile phone) and the processor (Payfirma).

Payment Gateway Fee
This is charged on every transaction.

Payment Processing
The automated processing of electronic payment transactions between merchants and consumers.
eBook: Payment Processing 101

Payment Processor
Organizations that partner with an acquirer to open merchant accounts, handle support, and manage payment processing on behalf of acquirers.
Tips for Choosing the Right Payment Processor

Payment Platform
A platform used to process payments via multiple channels.

Personal Identification Number (PIN)
A number entered into a terminal for ownership authentication to complete a transaction with a payment card.

PCI DSS (Payment Card Industry Data Security Standard) or PCI Compliance
A set of requirements that ensure all merchants that come into credit card information maintain a secure environment.
3 Easy Ways to Prevent Online Fraud

PCI (Payment Card Industry) Compliance Fee
A payment processing fee that is paid to the Payment Card Industry, either for non-compliance or compliance.  

PIN Verification
Verification of identity using a PIN.

Point of Sale (POS)
Often referred to as checkout. The location where payment is accepted or transactions occur, with a terminal or cash register.

Posting Date
The date that a transaction is posted to the consumer’s account. This may differ from the transaction date.

Processing Fees
The fees associated with the processing of credit card transactions.

Processing Rate
See Discount Rate.

Qualified Card
A baseline credit card that is a standard, no perks, no benefits card that is present when and where the transaction takes place.

Reason Code
A 2-digit code identifying the reason a chargeback was initiated.

Re-authorization
A request to authorize an additional amount. Often used by hotels when the original authorization is not sufficient to cover the charges.

Receipt
A physical or emailed summary of a transaction.
4 Quick Ways to Increase Your Sales with Email Receipts

Recurring Billing
Automatic and periodic payment under a pre-authorized agreement for an ongoing product or service.
Jumpstart Growth by Adding Subscriptions to Your Online Store
7 Ways Recurring Billing Can Help Your Business
3 Ways to Grow Your Business with Credit Cards
3 Ways to Avoid Subscription Billing Chargebacks
Platform: Recurring Billing

Refund
A credit issued by the merchant back to a customer when the customer returns a product.

Reporting
Analytics and statistics on your payment information, such as when, where, and how the transaction took place.

Retrieval Request Fee
When a customer initiates a chargeback, the pertinent data must be retrieved first. This fee covers any expense related to the retrieval.

Risk Management
Activities and technologies a merchant uses to protect their business and customers from loss due to fraud and to reduce the potential of chargebacks.

Secure Socket Layer (SSL) Authentication
A security feature that encrypts data sent over the internet, such as online transactions.
3 Easy Ways to Prevent Online Fraud

Set-up Fee
One-time payment processing fee charged for the set-up of a specific product or service (eCommerce set-up).

Settlement
An exchange of funds between a card issuer and an acquiring bank to complete a cleared transaction.

Showrooming
Visiting a store(s) in order to browse a product before buying it online at a lower price.
Webrooming vs. Showrooming

Smart Card
A payment card that has a small computer chip containing encrypted data. The chip is impossible for thieves to duplicate.

Soft Decline
Soft declines often occur from a temporary issue and once the issue is resolved, the transaction can be retried.

Statement/Admin/Maintenance Fee
This payment processing fee covers the cost of bank-end reconciliation, deposit of funds, and monthly processing statements.

Subscription Billing
See Recurring Billing.

Tablet POS
A completely functional POS system on a tablet.
Platform: Tablet POS

Terminal Identification Number (TID)
The number linked to a POS terminal used to identify a merchant.

Terminal Fee
If you want to accept payments with a traditional terminal, you have to either purchase, lease, or rent a terminal. These fees do not apply to eCommerce-exclusive businesses.

Third-Party Processors
See Payment Processors.

Tiered Pricing Structure
A pricing model in which the rates are structured in tiers. You pay different rates for different types of cards.

Traditional Terminal
A physical wired or wireless terminal that allows you to accept debit and credit card payments.
Platform: Traditional Terminal

Transaction
Any change in a business’s financial position or net worth (e.g. credit card purchase).

Transaction Date
The date that a transaction actually took place.

Transaction Fee
A payment processing fee that is charged for every credit card transaction.
Fees: The Anatomy of a Digital Transaction

Valid Date
The embossed date on a payment card of when the card starts being valid.

Virtual Terminal
See Web Terminal.

Web Terminal
A terminal accessed through a web browser that acts like a POS system by allowing you to accept credit cards as long as you have an internet connection.
Platform: Web Terminal

Webrooming
Researching products online and then visiting a store to make a purchase.
Webrooming vs. Showrooming