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Merchant Services Glossary

3D-Secure

A code-based protocol using a three-domain process as an additional security layer when processing online or wireless credit and debit card payments. The three-domain process requires that Wells Fargo Merchant Services, the card issuer, and all interconnected hardware/software are aligned to digitally authenticate and certify cardholder information. Current forms of 3D-Secure include Visa Secure®, Mastercard SecureCodeTM, Mastercard Identity CheckTM, and American Express SafeKey®.

ABA Routing Number

Also referred to as a transit routing number. Directs electronic ACH deposits to the proper bank institution.

ACH (Automated Clearing House)

The paperless funds transfer system maintained by the Federal Reserve or other entities that have networks to exchange electronic funds transfer items.

Acquirer

Any bank, financial institution, and public or private company that maintains a merchant's credit card processing relationship and receives all transactions from the merchant to be distributed to the credit card issuing banks. Also referred to as a card payment processor.

Address Verification Service (AVS)

A service provided in which the merchant verifies the cardholder's address with the issuing bank. Address verification is not a guarantee that a transaction is valid.

Adjustment

A debit or credit to a cardholder or merchant account to correct a transaction error.

Arbitration

The process followed by the payment networks to determine whether a card issuer or an acquirer has ultimate responsibility for a chargeback. Either member initiates this process after the re-presentment process is completed.

Authorization

Approval of a bankcard transaction by the card-issuing banks or approved independent service providers, for a specified dollar amount. An authorization indicates only the availability of the card member's credit limit at the time the authorization is requested.

Authorization Response

The reply to a request for approval on a transaction.

Authorization Response Code

A code returned in the authorization response to indicate approval of a transaction. The code is recorded on the transition receipt as proof of Authorization.

BIN (Bank Identification Number)

The six-digit range of numbers assigned by the Federal Bureau of Standards and used by card companies to identify their financial transactions. The Discover® range begins with '6' (6xxxxx), the Mastercard® range begins with ‘2’ (2xxxxx) or  '5' (5xxxxx), and the VISA® range begins with '4' (4xxxxx).

Card Issuer

Any Discover®, Mastercard®, American Express or VISA® member, or a commercial organization that establishes, issues, and maintains customer credit lines that are accessed through the use of a card. (Public and private companies and financial institutions that offer card-accessed lines of credit to consumers and businesses.)

Card-Not-Present Transactions

Transactions that are processed without the card or the cardholder being present, for example, phone or internet orders.

Card-Present Transactions

Transactions in which the cardholder and the card are present.

Cardholder

A person or entity that is issued a credit or debit account that is accessed through the use of a card.

Chargeback

When a credit card transaction is disputed (either at the request of the cardholder or by a card issuer), the dispute is handled through a chargeback. A chargeback will cause the amount of the original sale and a chargeback fee to be deducted from the checking or savings account you provided.

Clearing

The transfer of data between issuers and acquirers. 

Contactless Payments

Contactless payments are transactions that use chip-based technology and require no physical connection between the payment device (a card or mobile device) and the physical merchant terminal.

Control Number

Number that uniquely identifies a retrieval request or chargeback.

Credentials-On-File

See Stored Credentials.

Credit/Pending Settlement

Transactions of this status have been entered as credits, but have not yet been submitted for settlement. These transactions will remain in this unsettled state until they are submitted for settlement. Once a credit has been settled, its status changes to credited.

Cryptography

The process of writing, scrambling, and descrambling complex coded information as a means of secure communication. Many computer-based applications use cryptography to securely transmit sensitive personal and cardholder data.

CVV2/CVC2

CVV2/CVC2 is the three-digit value printed on the signature panel on the back of cards immediately following the card account number. The 3-digit value helps validate that the cardholder has a card in their possession, and the card account is legitimate.

Digital Secure Remote Payment (DSRP)

Designed for e-commerce transactions, DSRP is an optional payment method from Mastercard that uses chip card-based cryptography to make credit and debit card transactions safer and more secure.

Directory Server Transaction ID

Similar to a network reference ID, this is a unique reference number assigned to a single credit, debit, or gift card transaction when is authenticated using 3D Secure technology. The ID is automatically supplied by your 3D Secure provider.

Discount Rate

A discount rate is a fee associated with collecting, assessing, approving, processing, and settling credit card transactions. This fee is often a percentage of the transaction value. 

EMV

EMV stands for Europay, Mastercard and Visa. EMVCo sets the standards for EMV chip cards and EMV terminals. Many countries worldwide already use the EMV chip card technology. EMV chip cards have an embedded microchip that stores customer data. The chip is much more difficult to counterfeit than a magnetic stripe, because the information on the chip changes with each transaction.

Fees

Fees for screening and processing online payments may include, but are not limited to, costs for the following: 

  • Monthly Account
  • Discount rate
  • Per item charges for credit card and electronic check transactions
  • Chargebacks

Interchange Fees

This is the amount an acquirer pays to process transactions.

Interchange Program

A set of credit, debit, and prepaid card criteria established by Visa, Mastercard, and Discover where the majority of your card payment transactions are expected to qualify. Each program is assigned interchange levels, rates, and/or fees which will apply to you when you meet the established criteria. Non-qualifying transactions may be subject to additional costs depending on how you are currently priced. Refer to your specific online Payment Network Qualification Matrix for more detailed information. Note: For American Express transactions, this is known as “program pricing”.

Magnetic Stripe Reading

When the credit card is swiped through the terminal to record the card information. Obtaining a magnetic stripe reading proves the card's presence at the time of a transaction. 

MATCH (Member Alert To Control High Risk)

A shared database maintained by the payment networks that lists all merchants terminated for cause by acquirers.

MCC (Merchant Category Code)

The primary industry or industries in which you do business as determined by the payment networks and assigned to you by Wells Fargo Merchant Services using a four-digit category code. Examples include Restaurants (MCC 5812), Taxicabs & Limousines (MCC 4121), Women’s Clothing (MCC 5621), etc.

Merchant

An individual or business that sells products or services and is capable of accepting payment for products and services via a merchant account.

Merchant Account

The bank account a Seller identifies as the sole account from which monthly and/or transaction fees are debited.

Merchant Bank

The financial institution with which a merchant contracts to accept credit cards for payment of goods and services, also known as an acquirer or card payment processor.

Network Reference ID

A unique reference number assigned by the payment networks to a single credit, debit, or gift card transaction. It helps to specifically identify transactions and is used to monitor transactions associated with a particular payment card. This ID may appear on sales receipts and cardholder card statements for a specified transaction.

NFC (Near Field Communication)

NFC technology enables devices in close proximity to communicate. Payment transactions using NFC technology require a contactless merchant terminal and an NFC-enabled mobile device.

Payment Account Reference (PAR)

A unique alphanumeric identifier that links a cardholder’s primary account number (PAN) with all subsequent PANs for the same payment account, and all chip card payment tokens associated with that account. For example, a PAR would be used when a new payment card replaces a cardholder’s existing card.

Payment Gateway

An e-commerce application service that authorizes card payments.

Payment Network

Any entity formed to administer and promote credit cards, including but not limited to VISA, Mastercard, American Express, or Discover, that are licensing and regulatory agencies for credit card activities. Visit wellsfargo.com/paymentnetworks for more information.

Payment Token

A series of randomly generated numbers which replaces a cardholder’s primary account number (PAN). Tokens are used to process a card payment through the internet or wirelessly without sharing a cardholder’s personal details.

POS Entry Code

A specific, required code that is used to identify how a cardholder’s primary account number and expiration were captured. This helps to authenticate a transaction.

Primary Account Number (PAN)

Also known as a bank card number, this is the unique account number printed on cardholder’s credit, debit, or prepaid card.

Quasi-cash Purchase

A transaction representing sale of items that are directly convertible to cash such as money orders and travelers checks.

Re-presentment

The re-submission by an acquirer of a previously charged back sale in an attempt to re-charge the cardholder. Chargebacks requires some form of additional documentation confirming the validity of the charge and disputing the chargeback reason.

Retrieval Request

A retrieval request occurs when your customer requests more information about a transaction that appears on his or her credit card statement. 

Return Policy

The merchant's limitations and/or requirements on accepting returned merchandise. 

Sales Draft

The paper or electronic evidence of a purchase.

Secure Payment Page

A secure payment page assures customers that their payment information is encrypted for privacy and data integrity before it's sent over the internet. This page is typically identified by the "s" in https:// instead of http://. Payment gateway providers make this necessary e-commerce link possible by hosting the payment gateway software and individual secure payment pages on their own servers.

Settlement

The process of transferring funds for sales and credits between acquirers and card issuers, including the final debiting of a cardholder's account and crediting a merchant's account.

Shopping Cart

In online marketing, a piece of e-commerce software on a web server that allows visitors shopping at an internet site to select items for eventual purchase.

SIC (Standard Industry Codes)

Special numbers assigned by the payment networks to merchant types for identification and tracking purposes. Mastercard® uses MCC (Merchant Category Code), while VISA® uses SIC (Standard Industry Codes).

Stored Card Account Information

See Stored Credentials.

Stored Credentials

When you store cardholder payment information for ongoing or future use as authorized by the cardholder. This is typically done for recurring payments such as gym memberships or making installment payments on goods or services. In most cases, you will need to include the proper values in the transaction authorization request that indicates you are processing a transaction using stored credentials.

Switch Fee

A fee passed through to you from the PIN debit networks which is applied to each PIN debit transaction authorization, completion, or both. Fees for both apply when there is two-step process to complete a transaction such as for automated fuel dispenser (AFD) merchants.

Transaction

An act between a merchant and a cardholder that results in either a paper or an electronic representation of the cardholder's promise to pay for goods or services received from the act.

Unauthorized Transaction

Any sale for which a cardholder does not provide their specific authorization. This should not be confused with the failure to receive an authorization response from the card issuer.

Universal Cardholder Authentication FieldTM (UCAF)

UCAF is used by Visa and Mastercard to capture and transmit cardholder authentication data to a card issuer for a specific e-commerce credit or debit transaction. Each card issuer determines what data or process is needed to authenticate the cardholder using some form of 3D-Secure technology. That information is validated and passed back to the issuer to authorize the presented card for payment.

VAR (Value-added Reseller)

Value-added reseller, or a third party providing card payment processing products or services, such as software.