Glossary - online payments

Acquiring bank
Address verification service
API
BACS
Bespoke integration
Bond
Capture
Card Verification Code (CVC)
Charge-back
Chip and PIN
Cardholder not present (CNP)
Customer present
eCommerce
Encryption
Exposure
Fraud
Fraud guarantee
Fraud screening
Fulfilment
Hosted payment page
Http post
Internet merchant account
Information Commissioner’s Office (ICO)
Merchant account
Merchant ID (MID)
MOTO
Multivariate testing
Offline
Online
Online catalogue
Payment bureau
Payment gateway
PDQ machine
Payment processor
Payment service provider (PSP)
PKI
Real-time card authorisation
Retained balance
Reversals
Search engine optimisation (SEO)
Secure electronic transaction (SET)
Secure form
Secure server
Secure sockets layer (SSL)
Settlement period
Shopping cart
SME
Terminal ID
Virtual terminal
VPN
WHOIS
XML
XML-RPC

 Acquiring bank

The bank that supplies merchant services.

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 Address verification service (AVS)

A system that permits the verification of a card user’s address against the address held for the card.

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 API

API (application programming interface) allows different applications to link together.

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 BACS

Bank automated clearing system. An electronic payments method primarily used for large volumes of transactions such as payroll and regular business to business client and customer payments.

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 Bespoke integration

When an electronic payment solution requires an experienced programmer, a bespoke integration will be necessary.

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 Bond

A quantity of funds supplied by the merchant to cover the exposure of the acquiring bank.

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 Capture

The process of collecting funds from a card account once authorisation has taken place.

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 Card verification code (CVC)

Also CVV2 and CSC. A three-digit number printed on the back of a card that is used for extra confirmation that the card user has the original card.

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 Charge-back

Return of funds to a consumer, forcibly initiated by the issuing bank of the instrument used by a consumer to settle a debt/make a payment.

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 Chip and PIN

Security measure for ‘cardholder present’ transactions. The card user types in a PIN number instead of signing a sales receipt.

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 Customer not present (CNP)

A type of card transaction where the customer is not physically present to sign a sales voucher but able to authorise transaction over the internet, by mail or by phone.

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 Customer present

A type of card transaction where the customer is physically present.

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 eCommerce

The buying and selling of products or services over electronic systems such as the internet

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 Encryption

The process of encoding a file, for example a credit card number, to protect it when it is transferred over the internet.

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 Exposure

A measure of the risk that an acquiring bank will be exposed to when it offers a merchant credit and debit card services.

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 Fraud

A process of deliberate deception to obtain goods or services

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 Fraud guarantee

A guarantee offered by payment service providers or acquiring banks to protect the merchant against fraud on their account.

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 Fraud screening

A process of screening out potentially fraudulent transactions, for instance from certain geographic regions.

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 Fulfilment

The final stage of a purchasing transaction where the goods are delivered to the customer.

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 Hosted payment page

Card payments are captured on a third-party site. Users are taken away from your site during the payment process and then returned on completion

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 Http post

One of the standard web protocols for transferring data from the client browser to the web server.

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 Information Commissioner’s Office (ICO)

Government body that monitors data protection law compliance and enforces penalties for any security breach.

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 Internet merchant account (IMA)

An internet merchant account is a bank account that allows businesses to accept payments by debit or credit card via the internet.

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 MOTO

Mail order/telephone order of products or services by a written/posted/verbal communication.

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 Merchant account

A merchant account is a type of bank account that allows businesses to accept payments by debit or credit cards.

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 Merchant ID (MID)

Unique number used to identify a merchant issued by the acquiring bank.

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 Multivariate testing

Process of trialling webpages in a live environment.

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 Offline

Used to denote transactions that occur through traditional methods as opposed to online methods.

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 Online

Used to denote transactions that occur through web-based, electronic methods as opposed to traditional methods.

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 Online catalogue

Displaying a range of products in a website in the familiar catalogue format. Most eCommerce software allows the building and maintenance of a catalogue.

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 Payment bureau

Collects and processes card details on behalf of a business without requiring an internet merchant service with an acquiring bank or a separate PSP to be set up.

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 Payment gateway

eCommerce platform that authorises movement of funds between cardholder, merchant and acquiring bank.

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 Payment service provider

Payment service provider (PSP) offers merchants online services for accepting electronic payments by a variety of payment methods including debit and credit cards.

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 PDQ machine

Credit card processing machine that allows the merchant to physically "swipe" the card of the customer and authorise a transaction. A PDQ machine is connected to the acquiring bank via a telephone line.

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 PKI

Public key software infrastructure a system of public key encryption using digital certificates from certificate authorities and other registration authorities that verify and authenticate the validity of each party involved in an electronic transaction.

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 Payment processor

Company appointed by a merchant to handle credit card transactions for merchant acquiring banks.

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 Real-time card authorisation

When payment details are taken by the merchant and the transaction takes place immediately.

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 Retained balance

A retained balance is an amount of money that your provider requires you to always have retained in your account to cover the risk of any charge-backs or other charges. reversals

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 Reversals

The ability for a merchant to reverse a card transaction. The most common instance of this would be for a refund for returned goods. Might also be instituted if the merchant thought that a card had been used fraudulently.

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 Secure electronic transaction

The SET™ specification is an open technical standard for the eCommerce industry developed by Visa and MasterCard as a way to facilitate secure payment card transactions over the internet (Verified by Visa and SecureCode by MasterCard).

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 Secure forms

Forms using SSL (Secure Sockets Layer) cryptographic protocol in combination with server certificates to encrypt information exchanged between client's browser and the server.

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 Secure server

A web server that is protected by various security and encryption protocols to enable the safe processing of transactions.

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 Secure sockets layer (SSL)

A protocol designed by Netscape to provide encrypted communications on the internet. SSL is layered beneath application protocols such as http, smtp, telnet, ftp, gopher, and nntp and is layered above the connection protocol tcp/ip. It is used by the https access method.

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 SEO

Search engine optimisation – method of using keywords to improve search engine ranking.

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 Settlement period
The time taken from the moment a transaction is completed to the point where the funds are available to the merchant.

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 Shopping cart

The software package that is used to run and maintain the standard web eCommerce enabled product catalogue.

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 SME

Small and medium-sized enterprise

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 Terminal ID

Number issued to a merchant to identify the terminal used for card transactions.

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 Virtual terminal

Browser-based online payments system used to take payment for mail order and telephone orders

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 VPN (Virtual Private Network)

The use of encryption in the lower protocol layers to provide a secure connection through an otherwise insecure network, typically the internet.

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 WHOIS

Method for system administrators to obtain contact information for IP addresses, assignments or domain name administrators.

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 XML

Extensible mark-up language. An initiative from the w3c defining an "extremely simple" dialect of standardised generalised mark-up language suitable for use on the world-wide web.

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 XML-RPC

Usage of XML communication as a remote procedure call.

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