Wednesday, December 31, 2008


Re-presentment is a chargeback that is rejected and returned to a card issuer by a merchant bank on the merchant's behalf. A chargeback may be re-presented, or redeposited, if the merchant or merchant bank can remedy the problem that led to the chargeback. To be valid, a re-presentment must be in accordance with regulations established by the Credit Card Associations.

Tuesday, December 30, 2008


Processor is a bank member of MasterCard or Visa, or an approved non-member acting as the agent of a member bank, that provides authorization, clearing, or settlement services for merchants and member banks.

Monday, December 29, 2008

Printed Number

Printed number is a four-digit number that is printed below the first four digits of the embossed number on all valid MasterCard and Visa cards. The printed number should begin with a "5" for all MasterCard cards and with a "4" for all Visa cards and be the same as the first four digits of the embossed number. The printed number is one of the card security features that merchants should check to ensure that a card-present transaction is valid.

Saturday, December 27, 2008

Point-Of-Sale (POS) Terminal

Point-of-sale (POS) terminal is an electronic device used for authorizing and processing payment card transactions at the point of sale.

Friday, December 26, 2008

Pick-Up Response

Pick-up response is an authorization response instructing a card-present merchant to refuse a transaction and recover the card. In all circumstances, card recovery should only be attempted if it can be done by reasonable and peaceful means.

Wednesday, December 24, 2008

Payment Gateway

Payment gateway is an eCommerce application that provides services to Internet merchants for the authorization and clearing of online payment card transactions. It is the equivalent of a physical point of sale (POS) terminal located in most retail outlets. Payment gateways encrypt sensitive information, such as credit card numbers, to ensure that information passes securely between the customer and the merchant.

Tuesday, December 23, 2008

Merchant Chargeback Monitoring Program (MCMP)

Merchant Chargeback Monitoring Program (MCMP) is a Visa program that alerts merchant banks when one of their merchants has a chargeback-to-transaction rate of over one percent. Merchants then work with the bank to reduce their chargeback rates to acceptable levels. Failure to reduce chargebacks can result in fines for a merchant.

Monday, December 22, 2008

Merchant Bank

Merchant bank is a financial institution that enters into agreements with merchants to accept payment cards as payment for goods and services. Merchant banks are also called acquirers or acquiring banks.

Saturday, December 20, 2008

Merchant Agreement

Merchant agreement is the contract between a merchant and a merchant bank under which the merchant accepts payment cards for payment of goods and services, and agrees to abide by certain rules governing the acceptance and processing of payment card transactions. Merchant agreements may stipulate merchant liability with regard to chargebacks and may specify time frames within which merchants are to deposit transactions and respond to requests for information.

Friday, December 19, 2008


Member is an organization that is a member of Visa or MasterCard and which issues payment cards or signs merchants, or does both.

Thursday, December 18, 2008

Mail Order/Telephone Order (MO/TO)

Mail order/telephone order (MO/TO) is a merchant, market, or sales environment in which mail or telephone sales are the primary or a major source of income. Such transactions are frequently charged to customers' payment card accounts. See also: Card-Not-Present.

Wednesday, December 17, 2008

Magnetic Stripe Reader

Magnetic stripe reader is the component of a point-of-sale (POS) device that electronically reads the information on a payment card's magnetic stripe.

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Tuesday, December 16, 2008

Magnetic Stripe

Magnetic stripe is a strip of magnetic tape on the back of all payment cards that is "read" when a card is swiped through a point of sale (POS) terminal. The stripe is encoded with account information. On a valid card, the account number on the magnetic stripe matches the embossed number on the front of the card.

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Monday, December 15, 2008

Key-Entered Transaction

Key-entered transaction is a transaction that is manually keyed into a point-of-sale (POS) device.

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Saturday, December 13, 2008

Card Issuer

Card issuer (also called Issuer or an issuing bank) is a financial institution that issues payment cards. The card issuer extends a line of credit to the consumer. Liability for non-payment is then shared by the issuing bank and the acquiring bank, according to rules established by the card association brand. However, the card issuer assumes primary liability for the consumer's capacity to pay off debts they incur with their card.

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Friday, December 12, 2008

Internet Protocol Address

Internet Protocol (IP) address is a unique number that is used to represent individual computers in a network. All computers on the Internet have a unique IP address that is used to route messages to the correct destination.

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Thursday, December 11, 2008

High-Risk Merchant

High-risk merchant is a merchant that is at a high risk for chargebacks due to the nature of its business. As defined by Visa and MasterCard, high-risk merchants include direct marketers, travel services, outbound telemarketers, inbound teleservices, and betting establishments. See also: High-Risk Chargeback Monitoring Program.

Wednesday, December 10, 2008

High-Risk Chargeback Monitoring Program (HRCMP)

High-Risk Chargeback Monitoring Program (HRCMP) is a Visa program that notifies merchant banks when a high-risk merchant has a chargeback-to-transaction rate of over one percent. Fines of $100 per chargeback are imposed until the merchant reduces chargebacks to acceptable levels. See also: High-Risk Merchant.

Tuesday, December 9, 2008

Good Through Date

Good Through date (also written Good Thru date) is the date after which a payment card is no longer valid, embossed on the front of all valid cards. The Good Through date is one of the card security features that should be checked by merchants to ensure that a card-present transaction is valid. See also: Card expiration date.

Monday, December 8, 2008

"Flying V"

"Flying V" is the stylized, embossed "V" located to the right of the "Good Thru" date on all valid Visa cards. The "flying V" is one of the card security features that should be checked by merchants to ensure that a card-present transaction is valid.

Sunday, December 7, 2008


Firewall is a security tool that blocks access from the Internet to files on a merchant's or third-party processor's server and is used to ensure the safety of sensitive cardholder data stored on a server.

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Saturday, December 6, 2008

Exception File

Exception file is a list of lost, stolen, counterfeit, fraudulent, or otherwise invalid account numbers kept by individual merchants or their third-party payment processors. The exception file should be checked as part of the authorization process, particularly for transactions that are below a merchant's floor limit.

Friday, December 5, 2008

Embossed Number

Embossed number is the 16-digit account number that appears in raised print on the front of all valid major cards. The embossed number is one of the card security features that should be checked by merchants to ensure that a card-present transaction is valid.

Thursday, December 4, 2008

Electron Card

Electron card is a Visa International debit card that is currently accepted, but not issued in the United States and can only be used for card-present transactions. Electron cards have slightly different security features than other Visa cards: the front of the card contains an Electron rather than dove hologram, and the 16-digit account number is printed, not embossed.

Wednesday, December 3, 2008

Dove Hologram

The dove hologram is a three-dimensional hologram of a dove in flight that appears on all valid Visa cards. When the card is tilted back and forth, the dove should appear to "fly." The dove hologram is one of the card security features that merchants should check to ensure a card-present transaction is valid.

Tuesday, December 2, 2008

"Doing Business As" (DBA)

"Doing Business As" (DBA) is a merchant's legal business name as differentiated from the names of a company's principals or other entity that owns or manages the business. DBA is the business name that must appear on the merchant's billing descriptor, which in turn will be the name that will appear on a cardholder's monthly statement. A DBA that is not clearly recognizable to cardholders can lead to potential transaction copy requests and chargebacks.

Monday, December 1, 2008


Disclosure is the process of conveying information about the merchant's policies for merchandise returns, service cancellations, and refunds. The procedures vary for card-present and card-not present merchants, but in general, disclosure must occur before a cardholder signs a receipt to complete the transaction.