Merchant Account Glossary (O-R)

<p><font face="tahoma,arial,helvetica,sans-serif" size="2"><br /><strong>Online Financial Transaction</strong><br />A transaction that is authorized, cleared, and settled in a single online message. <br /><strong><br />On-Us Transaction</strong><br />A transaction where the issuer and the acquirer are the same. An &quot;on-us&quot; check would be one in which a depositor&#39;s check is presented for payment at the same financial institution that carries the account on which the check is written.<br /><strong><br />Open To Buy Amount</strong><br />Dollar amount of credit remaining for customer at the time of authorization. <br /><br /><strong>Order Number</strong><br />A 17 character alphanumeric field that may be used between the Cardholder and the Merchant for accounting or tracking purposes. <br /><strong><br />Overlimit</strong><br />This refers to a cardholder&#39;s account that has surpassed its credit limit with a transaction. (Their outstanding balance is beyond their credit limit.) <br /><br /><strong>PAN</strong><br />Acronym for Primary Account Number. The number that is embossed, encoded, or both, on a plastic card that identifies the issuer and the particular cardholder account. <br /><strong><br />Paper Draft</strong><br />Sales slips, credit slips, cash disbursement slips, drafts, vouchers, and other obligations indicating use of a card or a card account. <br /><br /><strong>Paper Processing</strong><br />A manual imprinter is used with paper sales drafts for credit card imprints and signature. Sales drafts are presented to the bank for deposit. (This was the primary processing method used prior to electronic processing being introduced) <br /><strong><br />Password </strong><br />A sequence of characters which allows users access to a system. Although they are supposed to be unique, experience has shown that most people&#39;s choices are highly insecure. Humans tend to choose short words such as names, which are easy to guess.<br /><strong><br />P-Card</strong><br />P-card is an abbreviation for Purchasing Card, Purchase Card, Procurement Card, or Purchasing Card.<br /><strong><br />PC Software</strong><br />A software program that is designed to perform a specific function on a computer system. Examples would be accounting systems, manufacturing systems, order entry and fulfillment, ticketing, reservations, etc. The application is either purchased or built by the merchant, and must be interfaced with a credit card authorization system in order to provide on-line transaction processing.<br /><br /><br /><strong>Per Transaction Fees</strong><br />Fees paid by the merchant to the merchant bank or other contracted party on a per transaction basis. <br /><strong><br />PIN</strong><br />Acronym for Personal Identification Number issued by the credit card issuer, which is entered into a PIN Pad by the cardholder when requesting cash back on a debit card transaction or for use in the ATM. <br /><br /><strong>Pin Pad</strong><br />An encrypted device, which is either a separate unit or is integrated into a POS terminal that provides a keypad for cardholder to enter private PIN number. Pin Pad types can be cabled to a terminal are integrated in the POS terminal. (Pin Pad must be encrypted to match processor and the acquiring bank) <br /><br /><strong>PKI</strong><br />Acronym for Public Key Infrastructure. The total system used in verifying, enrolling and certifying users of a security application <br /><br /><strong>Plaintext</strong><br />Data before the application of a cryptographic algorithm.<br /><strong><br />Plastic (Card)</strong><br />This is a generic term used to identify any of the various cards issued to cardholders. <br /><br /><strong>Policy</strong><br />An informal, generally natural language description of desired system behavior. Policies may be defined for particular requirements, such as confidentiality, integrity, availability, safety etc.<br /><br /><strong>POP</strong><br />Acronym for Point Of Purchase, indicating where the terminal is installed at the merchant site. <br /><br /><strong>POS</strong><br />Acronym for Point Of Sale, indicating the credit card device that is used to process the credit card transaction. <br /><br /><strong>POS Terminal</strong><br />Equipment used to capture, transmit and store credit card transactions at the point of sale. Examples are Verifone terminals.<br /><br /><br /><strong>POS System</strong><br />A system that processes commercial transactions such as a credit card terminal, electronic cash register, or specialized software. <br /><br /><strong>Posting</strong><br />The process of updating individual cardholder account balances to reflect merchandise sales, instant cash, cash advances, adjustments, payments, and any other charges or credits. <br /><br /><strong>Presentment</strong><br />A clearing record that an acquirer presents to an issuer through interchange, either initially (a first presentment) or after a chargeback (a re-presentment). <br /><strong><br />Prime Vendor</strong><br />Prime vendor is a general term used in procurement to describe an important supplier. In some cases, such as the U.S. Department of Veterans Affairs (VA), it also connotes a certain way of doing business with said supplier.<br /><br /><strong>Principal (Prin)</strong><br />Primary owner and signatory of the merchant account and, unless otherwise designated by them, the <strong>only one who may receive information about the account. <br /><br />Prior Authorization</strong><br />An authorization usually done before a transaction takes place. The approved authorization request may be held for an extended length of time before a card is present or not. <br /><br /><strong>Private Key</strong><br />A cryptographic key known only to the user, employed in public key cryptography in decrypting or signing information.<br /><strong><br />Private Label Cards</strong><br />Credit, debit or stored-value cards that can be used only within a specific merchant&#39;s store. Also referred to as proprietary cards.<br /><br /><strong>Procard</strong><br />Procard (lowercase) is used by some organizations as an abbreviation for Procurement Card. ProCard (uppercase) is the name of a company that provides software and services to some issuing banks. <br /><br /><strong>Processor</strong><br />A Processor is the company that actually routes an Authorization Request from a Point of Sale device (such as a Verfone credit card terminal) to Visa or Master Card, and then arranges for Fund Settlement to the merchant. Such processors are traditionally accessed via direct dial out modems connecting to their system.<br /><br />-Processors need to have a Sponsoring Bank in order to gain access to the Visa and Master Card networks. When a Processor or other entity has made such an arrangement with a Sponsoring Bank to resell their services, they are called an Agent of that bank.<br /><br />-Any entity that sells Visa or Master Card must disclose themselves as an Agent of their Sponsoring Bank. Such sales entities may be a Processor, or an ISO/Agent of the Processor or Processor/Bank alliance.<br /><br />-Many banks are also their own processors, while other banks will use a Third Party Processor to handle this processing for them (in their own brand name in some cases).<br /><br /><strong>Processing Date</strong><br />The date on which the transaction is processed by the acquiring bank<br /><strong><br />Processing Network (Vendor)</strong><br />The medium of data transport between the merchant application and the processor. This company authorizes and captures credit card transactions. Some examples of processing networks are FDR, MAPP and Envoy.<br /><strong><br />Processing Software</strong><br />The medium of data transport between the merchant application and the processor. This company authorizes and captures credit card transactions. Some examples of processing networks are FDR, <br />MAPP and Envoy.<br /><br /><strong>Procurement Card</strong><br />Procurement Card(s) (or purchase cards / purchasing cards) are one type of corporate/commercial card. They are typically issued to individuals that have the authority to make purchases on behalf of their organization; expenses are centrally billed to the cardholder&#39;s organization.<br /><br /><strong>Public Key</strong><br />A cryptographic key which is used for data encryption and which cannot be used for decryption. Public keys can be freely published.<br /><strong><br />Public Key Cryptography</strong><br />A form of asymmetric encryption where all parties possess a pair of keys, one private and one public, for use in encryption and digital signing of data<br /><strong><br />Purchase/Purchasing Card</strong><br />Card issued by either a business organization or government agency for certain purchases such as fuel, vehicle maintenance or supplies. Subject to &ldquo;non-qual&rdquo; surcharges.<br /><br /><br /><strong>Qualified Transaction </strong><br />A transaction that qualifies for the lowest interchange rate based on fraud risk level and required criteria such as credit card must be swiped in a retail POS terminal and batches must be transmitted within 24 hours of credit card transaction sales. <br /><br /><strong><br />Real-Time Authorization</strong><br />The authorization or approval of a credit card transaction at the same time that the customer is making the purchase, with no delays for the processing of data.<br /><strong><br />Real-Time Processing</strong><br />Real-Time Processing means that when a web site&#39;s customer conducts an online purchase, that the check or credit card information is conveyed to the Processor at that exact time so that an authorization can be requested and received at that moment. Real-Time Processing always implies that a Secure Payment Gateway is being utilized, whether proprietary or third party.<br /><br /><strong>Receipt</strong><br />A hard copy document recording a transaction that took place at the point of sale, with a description that usually includes: date, merchant name/location, primary account number, amount, and reference number. <br /><strong><br />Recurring Billing</strong><br />Transactions for which a cardholder grants permission to the Merchant to periodically charge his account number for recurring goods or services.<br /><strong><br />Recurring Fees</strong><br />Regular, most often monthly, charges that are incurred when maintaining an active merchant account. Recurring fees include the discount rate, transaction fees, statement fees, and the monthly minimum.<br /><strong><br />Reference Number</strong><br />Number assigned to each monetary transaction in a descriptive billing system. Each reference number is printed on the monthly statement to aid in retrieval of the document, should it be questioned by the cardholder. <br /><strong><br />Refund</strong><br />Create a credit to a cardholder account, usually as a result of a product return or to correct an error.<br /><br /><strong>Regulation E</strong><br />Electronic Funds Transfers - Establishes the rights, liabilities, and responsibilities of parties in electronic funds transfers and protects consumers when they use such systems<br /><br /><strong>Regulation Z</strong><br />Truth in Lending - Prescribes uniform methods for computing the cost of credit, for disclosing credit terms, and for resolving errors on certain types of credit accounts. This federal regulation governs all aspects concerning credit cards. It pertains to the issuer and cardholder, as well as any organization involved in the processing of credit cards.<br /><strong><br />Representment</strong><br />A follow-up transaction originated by the merchant in order to recover funds that were previously charged back to the merchant, by the card holder and/or the card issuer, as being unauthorized or fraudulent.<br /><strong><br />Request Authorization (auth)</strong><br />Submits a transaction for Authorization Only. (See Authorization)<br /><br /><strong>Reserve Account</strong><br />One method that ACH Processor&#39;s use to mitigate risk, is to require that merchants maintain a Reserve Account at the Processor&#39;s Sponsoring Bank. This allows the Processor to issue a Hold on funds in this account when fraud has been detected or an excessively large number of returns is received. Merchants with good credit and history can usually meet the expectations of ACH Processors for covering returns and so are not always required to keep a reserve account. In cases where a reserve is required, the minimum-reserve-balance in the account is set at about 20% of the anticipated processing volume. New merchants are usually allowed to build up their reserve by sending in transactions which are not withdrawn until the minimum reserve balance is achieved; after that, the merchant is allowed to withdraw the excess funds for transfer to their home town bank.<br /><strong><br />Retail</strong><br />Term for storefront businesses where card and cardholder are present, credit card is swiped in the POS terminal, and merchandise is &ldquo;on hand&rdquo; for purchasing at POS. Discount rate is lower based on low fraud risk. The cardholder is present to sign sales receipt and be compared to the signature on the credit card. <br /><strong><br />Retail Merchant</strong><br />A merchant that provides goods and/or services in the retail industry, but is not a mail/phone merchant, a recurring services merchant, or a T&amp;E merchant. <br /><strong><br />Retrieval Request</strong><br />An issuer&#39;s request for a transaction receipt, which could include the original, a paper copy or facsimile, or an electronic version thereof. <br /><strong><br />Return</strong><br />A credit for returned product or service after the terminal batch has been closed and transmitted. The card number must be either re-swiped or keyed and amount of sale processed via a return key. The cardholder&rsquo;s account will be credited for the return amount. <br /><strong><br />Reversal</strong><br />An online financial transaction used to negate or cancel a transaction that has been sent through interchange in error. </font></p><p>&nbsp;</p><p><font face="tahoma,arial,helvetica,sans-serif" size="2"><strong><a href="http://www.offshoremerchantexperts.com/offshore_merchant_account_terminogies_k_to_n.html">previous</a> <a href="http://www.offshoremerchantexperts.com/offshore_merchant_account_terminogies_s_to_v.html">next </a></strong></font></p>