Payments Industry Definitions
Term
Definition
3DS
Acronym for Three Domains Secure. 3DS is an authentication process where three “domains” (hence 3D) are involved in authorizing a transaction. Those domains are the issuing bank, the acquiring bank, and an “interpolarity” domain, that handles communications between merchant, issuer and acquirer.
acquirer
(AKA “acquiring bank”) The merchant’s bank that receives the money from a transaction.
Agent
Agents are subcontracted by ISOs or MSPs to connect merchants with the card association they resell for. Read More →
BIN
The Bank Identification Number is the first 4-6 numbers on a credit card that indicate the issuing bank.
CE3.0 (Compelling Evidence 3.0)
CE3.0 (Compelling Evidence 3.0) is a Visa rule change to provide liability protection to merchants when they can identify cardholder participation in card-not-present (CNP) transactions which they’re now claiming as fraud. When a CNP dispute is assigned the reason code 10.4 “Other Fraud,” and the merchant can show at least two prior undisputed transactions from the same Personal Account Number (PAN) that all match specific criteria with the dispute, that 10.4 dispute is invalidated. Read More…
CAID
The Card Acceptor ID is a numeric string that identifies a store location or transaction point. This number is provided by the merchant’s acquiring bank.
CDRN
Acronym for Verifi’s Cardholder Dispute Resolution Network. This platform enables subscribed merchants to refund disputes before they become chargebacks.
chargeback
A reversal of charges by an issuing bank resulting from cardholder complaint, fraud, or processing error.
chargeback ratio
The percentage of transactions that become chargebacks within a specified period of time, used by Visa, MasterCard and other card associations and banks to determine if a merchant is processing too much fraud. As a general rule, this threshold is at or below 1%.
compelling evidence
The evidence required in representment cases submitted by a merchant that is sufficient enough to reverse a chargeback. This includes transaction data, delivery confirmations, and cardholder interactions with the merchant. Any evidence that ties a cardholder to a transaction. Read More →
Consumer Clarity™
Formerly known as Eliminator, Consumer Clarity™ is a dispute prevention tool created by Ethoca that sends extensive transaction details from the merchant to the cardholder and their issuing bank to prevent unwarranted disputes.
decline
When a transaction is invalidated because the information provided can not be authenticated or it triggers processing security measures.
dispute notice
Notification sent to merchant of a transaction dispute, either from fraud or other reasons.
Eliminator
Currently known as Consumer Clarity™, Eliminator was a product created by Ethoca that sends transaction information as it is gathered to issuers and cardholders.
EMV
Acronym for “EuroPay, MasterCard and Visa” which together created the standard for “smart card” technology. Read More →
false decline
(AKA false positive) When a legitimate transaction was incorrectly declined. Read More →
false positive
(AKA false decline) When a legitimate transaction was incorrectly declined. Read More →
fraud notice
Notification of confirmed fraud which is triggered by Visa TC40 and Mastercard SAFE fraud data.
friendly fraud
When a cardholder tries to get money back from a purchase that they made, claiming the transaction was fraudulent. Read More →
gateway
The point of sale where a cardholder enters their credit card and other personal information required to process a transaction.
ISO
Acronym for “Independent Sales Organizations”. ISOs are contracted by VISA to connect merchants with their services. Read More →
issuer
(AKA “issuing bank”) The bank that has issued the card that a cardholder uses to purchase goods/services from a merchant.
MDR
Acronym for “Merchant Discount Rate”. The rate that a merchant is charged per transaction.
merchant account
A bank account which the merchant holds with an acquiring bank to process credit card transactions.
MID
Acronym for “Merchant Identification Number”. The number that identifies a merchant account, MID is now used as a shorthand for a merchant account.
MSP
Acronym for “Member Service Providers”. MSPs are contracted by MasterCard to connect merchants with their services. Read More →
Order Insight™ (OI)
A dispute prevention tool created by Verifi that sends extensive transaction details from the merchant to the cardholder and their issuing bank to prevent unwarranted disputes.
paywall
The divide between free, publicly accessible content and the area users must pay to access on a website.
PCI
Acronym for “Payment Card Industry Association”. The PCI is the trade group of major card companies American Express, Discover, JCB, MasterCard and Visa.
presentment
The request made by an acquiring bank to an issuing bank to retrieve funds that pay for a transaction. Read More →
Rapid Dispute Resolution (RDR)
Visa product that enables merchants to automate dispute resolutions with pre-defined rulesets that trigger a fraud-based refund. Read More →
representment
When a merchant or their acquirer re-submit their request for funds from a cardholder after the initial transaction was charged back. Read More →
rolling reserve
Usually 5-10% of a merchant’s monthly sales that are withheld by an acquirer to cover costs stemming from chargebacks. Read More →
ticket size
The average dollar amount of a merchant’s transactions. Read More →
TID
Acronym for “Terminal Identification Number”. The number that identifies a specific terminal that has processed a transaction.
user logs
A form of compelling evidence, user logs track how a customer logs in and navigates behind a merchant’s paywall. Read More →
VCR
Acronym for “the VISA Claims Resolution Initiative”. The initiative was implemented April 15, 2018 as an attempt to update and improve cardholder disputes.
VMPI
Acronym for “VISA Merchant Purchase Inquiry”. A component of the VCR, the VMPI is an automated platform VISA provides issuing banks with to send transaction data to merchants in cardholder disputes. It is intended as a preemptive means to resolve disputes before they become chargebacks.
VROL
Acronym for “VISA Resolve Online”. This is VISA’s proprietary online infrastructure for resolving cardholder disputes. VROL enables merchants and issuers to exchange transaction data to facilitate dispute resolution.
