An additional authentication layer for online card payments. It can ask the cardholder to verify their identity or use risk signals to authenticate a transaction, helping merchants reduce certain types of card-not-present fraud.

A U.S. electronic network used to move money directly between bank accounts. Businesses commonly use ACH for customer payments, recurring billing, payroll and vendor payments.

The financial institution or acquiring organization that supports a merchant's ability to accept card payments and routes transactions into the card-payment networks.

A fraud-prevention check that compares address information supplied during a transaction with information held by the card issuer. AVS is commonly used for ecommerce and other card-not-present payments.

Payment options outside traditional credit and debit card transactions, such as digital wallets, bank transfers and certain buy-now-pay-later services.

Fees charged by card networks as part of processing card transactions. They are separate from interchange and from the processor's own markup.

The process of asking the card issuer whether a transaction should be approved. Authorization confirms that the account is available for the transaction but is not the same as final settlement.

A code generated when a card issuer approves a transaction. It serves as a reference showing that authorization was granted.

The average dollar value of a merchant's transactions over a period of time. Average ticket size can influence the economics of different processing-pricing models.

Digits at the beginning of a payment card number that identify information about the card issuer and card program. BIN information can also be used in fraud and transaction-routing decisions.

One one-hundredth of one percentage point. In processing pricing, 25 basis points equals 0.25%. Basis points are frequently used to describe processor markup.

A group of authorized transactions submitted together for clearing and settlement. Many merchants close or settle a batch at the end of each business day.

A fee that may be charged when a merchant closes or submits a batch of transactions for settlement.

A payment option that allows a customer to divide a purchase into multiple payments, subject to the terms and approval rules of the BNPL provider.

The payment network that establishes rules and facilitates communication among participants in card transactions. Major U.S. examples include Visa, Mastercard, American Express and Discover.

The three- or four-digit security value printed on a payment card. Merchants may request it during card-not-present transactions as an additional fraud-control measure.

A transaction in which the physical card is not presented to the merchant, such as an ecommerce, telephone or certain invoice payment. CNP transactions generally carry different fraud risks and processing economics than in-person transactions.

A transaction in which the customer and payment credential are physically present at the point of sale, typically using a chip, tap or other supported in-person method.

The person or organization authorized to use a credit, debit or other payment card.

Information associated with a payment card or cardholder that may be subject to security requirements. Businesses should limit how much sensitive payment information they store or handle.

A transaction that is formally disputed through the card-payment system and may be reversed from the merchant. Chargebacks can result from fraud, processing errors, customer disputes or other reasons.

A fee a processor or acquiring institution may assess when a chargeback is initiated against a merchant.

A measure comparing a merchant's chargebacks with its transaction activity. Excessive chargeback levels can lead to additional monitoring, higher costs or restrictions on a merchant account.

The stage after authorization when transaction information is exchanged and financial obligations among payment participants are calculated before final settlement.

An in-person payment completed by tapping a compatible card, smartphone or wearable near an NFC-enabled payment device.

The systems and services that enable a business to accept card payments and move transaction information through authorization, clearing and settlement.

A payment in which the merchant and cardholder or issuing institution are located in different countries. Cross-border transactions can involve additional fees and currency considerations.

A software-based wallet that stores or represents payment credentials so customers can pay with a phone, computer, smartwatch or other compatible device. Examples include Apple Pay and Google Pay.

A term often used for the percentage-based portion of merchant processing charges. Because providers may use the term differently, merchants should review exactly which costs are included.

A customer's challenge to a transaction. Some disputes are resolved before becoming chargebacks, while others proceed through the formal card-network chargeback process.

A pricing approach in which a business displays different prices based on the payment method used, typically distinguishing cash from card pricing. Programs must be structured and disclosed in accordance with applicable card-network rules and laws.

A practical measure of total processing expense. It is generally calculated by dividing total processing costs by total card sales volume for the same period.

The global technology standard associated with chip-enabled payment cards and terminals. EMV helps protect in-person transactions by using dynamic transaction data rather than relying solely on static magnetic-stripe information.

The process of transforming readable data into a protected form that cannot be easily understood without the appropriate cryptographic key. Encryption is an important part of payment-data security.

A fee associated with use of a payment gateway. Depending on the provider, gateway pricing may include monthly, per-transaction or other charges.

A secure checkout page hosted by a payment provider where customers enter payment information. Hosted pages can reduce the amount of sensitive card data handled directly by a merchant's website.

An organization that markets or provides merchant payment services through relationships with acquiring institutions, processors or other payments providers.

A major component of card-acceptance cost associated with transactions moving through the card networks. Interchange varies based on factors such as card type, transaction method, merchant category and transaction data.

A pricing model that separates underlying interchange and network costs from the processor's markup. It can make it easier for merchants to see the provider's added processing margin.

The financial institution that issues a customer's credit, debit or other payment card and decides whether individual transactions should be approved or declined.

A transaction in which card information is manually entered rather than captured by inserting, tapping or swiping the payment credential. Keyed transactions may have different cost and risk characteristics.

Additional transaction information that can be submitted with certain commercial, corporate or purchasing-card transactions. When properly supported and eligible, enhanced data can affect interchange qualification.

A business or organization that accepts payment from customers in exchange for goods or services.

The payment-processing relationship and account structure that enables a merchant to accept electronic card payments and receive settlement of approved transactions.

A four-digit code used by the payments industry to classify a merchant according to its primary type of business. MCCs can affect card-network rules, rewards treatment, risk and processing economics.

An identifying number associated with a merchant's payment-processing account or relationship.

A mobile device or portable payment setup that allows a merchant to accept payments away from a traditional countertop register.

A pricing provision under which a merchant may be required to generate a minimum amount of specified processing fees during a month or pay the difference.

A recurring fee that a processor or merchant-services provider may charge for maintaining or servicing an account. The exact name and purpose vary by provider.

Fees associated with the card networks and transaction-routing infrastructure. These are distinct from a processor's own markup and may appear under several names on a merchant statement.

A secure digital credential used in place of an actual card number. Network tokens can improve security and may help maintain recurring-payment continuity when card credentials change.

Short-range wireless technology that enables contactless communication between compatible payment cards, smartphones, wearables and payment terminals.

A payment strategy that connects customer transactions across channels such as in-store, ecommerce, mobile and recurring billing to create a more consistent payment experience.

A payments organization that enables eligible businesses to accept payments as sub-merchants under the facilitator's broader acquiring relationship, rather than requiring each business to establish the same type of direct merchant relationship.

Technology that securely captures and routes payment information from a merchant's website, application, virtual terminal or other payment environment for processing.

A company or platform that helps route electronic payment transactions among merchants, acquiring institutions, card networks and issuers for authorization and settlement.

A provider that offers businesses one or more services needed to accept electronic payments, which can include gateways, processing, merchant onboarding and related payment capabilities.

A physical device used to accept in-person payments. Modern terminals may support EMV chip cards, contactless payments, PIN debit and other payment methods.

The process of meeting applicable PCI DSS requirements based on how a business accepts, processes, stores or transmits cardholder data.

The Payment Card Industry Data Security Standard. It establishes security requirements intended to protect cardholder data for organizations that store, process or transmit payment-card information.

The place or system where a customer completes a purchase. A POS solution may include software, payment hardware, inventory functions and integrations with other business systems.

A payment-security approach that encrypts card data at the point of interaction and keeps it protected until it reaches an approved secure environment for decryption.

An authorization used to verify available funds or credit before the final transaction amount is completed. It is common in businesses such as hotels, vehicle rentals and other situations where the final amount may change.

The portion of processing cost added by a processor or merchant-services provider above underlying costs such as interchange and network fees. Markup may include percentage, per-transaction and recurring charges.

A payment arrangement in which a merchant charges a customer on a scheduled basis, commonly used for subscriptions, memberships and ongoing services.

A merchant-initiated return of funds to a customer for a previously processed transaction.

Funds that a processor or acquiring institution may hold to manage financial risk associated with a merchant account. Reserve requirements are more common in businesses with elevated chargeback, delivery or financial risk.

A request for transaction information or documentation related to a cardholder inquiry or dispute. Responding accurately and promptly can be important in the dispute process.

The process through which completed payment transactions are finalized and funds are moved through the payment system for deposit to the merchant, subject to the merchant's funding arrangement.

A recurring charge that may be assessed for account statements or account administration. Some providers charge it even when statements are delivered electronically.

An additional amount added to an eligible credit-card transaction to help offset acceptance costs. Surcharging is subject to card-network requirements and applicable laws and is not the same as every other form of cash-discount or dual-pricing program.

Technology that allows a compatible smartphone or other device to accept contactless payments, in some implementations without a separate traditional card reader.

A security technique that replaces sensitive payment-card information with a substitute token. The token can be used for approved future transactions without exposing the underlying card number.

A fixed charge assessed for each transaction or processing event. The amount and which transaction types trigger the fee depend on the merchant's pricing agreement.

The risk-review process used to determine whether a business qualifies for merchant processing and under what terms. Underwriting may consider the business model, products, transaction volume, average ticket, chargeback exposure and financial risk.

A secure browser-based or software interface that lets a merchant manually enter payment information, often for telephone orders, invoices or other card-not-present transactions.

Cancellation of a transaction before it has completed settlement. A void differs from a refund, which generally occurs after the original transaction has settled.

A product or payment service provided by one company but presented under another company's branding.