Our Glossary of Payment Terms

Welcome to our Glossary on payment terms, WikiPAYdia. We started a collection of terms here, but as always with these kinds of documents it is never complete. So if you are missing a term or if you would like to contribute in any other way, we would be happy to hear from you!

ACH (Automated Clearing House)

The Automated Clearing House (ACH) Network is an electronic funds-transfer system run by the former National Automated Clearing House Association (NACHA) since 1974. The ACH payment system provides ACH transactions for use with payroll, direct deposit, tax refunds, consumer bills, tax payments, and other payment services.


Is the financial institution that maintains a merchant’s account in order to accept credit cards. The acquirer settles card transactions for a merchant into their account.

Acquirer’s Margin

The fee that the acquirer has on each transaction. The acquirer’s margin is supposed to cover the credit risk and overheads that the acquirer has, as well as the profit that the acquirer makes.

Account Information Service Provider (AISP)

Account Information Service Providers (AISP) are providers of Account Information Services (AID). They access information stored with account-keeping financial institutions on behalf of a customer. Account Information Service Provider (AISP) or a company with an AISP license, is a type of financial institution providing access to the financial information of the user on the accounts that are held with other institutions.


Alipay is an eWallet app that lets users store debit or credit card details to make online and in-store purchases using their phones. It works as a mobile wallet-based payment method, similar to Apple Pay. Alipay can be used to make purchases where the merchant has listed Alipay as a valid form of payment. While the app started with simplified and traditional Chinese, it has recently added English. This makes it more accessible to native English speakers traveling through China. Alipay is a mobile payment app used by Chinese nationals to make cashless payments.

Alternative Payment Methods

Alternative payment methods are defined as a way of paying for goods or services which are not made via cash or major card schemes (Visa, MasterCard, American Express). This includes prepaid cards, mobile payments, e-wallets, bank transfers, and ‘buy now, pay later’ instant financing.

AML (Anti-Money Laundering)

Anti-money laundering (AML) refers to the activities financial institutions perform to achieve compliance with legal requirements to actively monitor for and report suspicious activities.

API (Application Interface)

An application programming interface (API) is a connection between computers or between computer programs. It is a type of software interface, offering a service to other pieces of software.

APP Fraud (Authorised Push Payment)

Authorized Push Payment (APP) fraud is when a fraudster deceives a business into sending them a payment into a bank account controlled by the fraudster. This can be done in a variety of ways but is typically based on either social engineering techniques such as impersonation or hacking into payment systems to change bank account details.

APP Fraud Prevention Act 209

Helps protect consumers by making it harder for criminals to commit APP fraud from early 2019. It will set out how consumers can be vigilant and take reasonable steps to protect themselves, while giving them greater levels of protection and support from their banks.

ASPSP (Account servicing payment service provider)

Account Servicing Payment Service Providers provide and maintain payment accounts for payment service users (PSUs). Traditionally, ASPSPs are banks and similar institutions.


Payment Authorization is a process through which the amount to be paid on a payment method is verified. In case of credit cards, authorization specifically involves contacting the payment system and blocking the required amount of funds against the credit card.

B2B ID & Verficiation Platform

Business to Business Identification & Verification Platform

BACS (BACS Payment Schemes Limited / Bankers ‚Automated Clearing System)

BACS is responsible for the schemes behind the clearing and settlement of UK automated payment methods, Direct Debit and Bacs Direct Credit.


Bundesanstalt für Finanzdienstleistungsaufsicht (= Federal Financial Services Authority).

The Federal Financial Supervisory Authority ( BaFin ) brings together under one roof the supervision of banks and financial services providers, insurance undertakings and securities trading.


Banking is the business of protecting money for others, and making that money product. Banks lend this money, generating interest that creates profits for the bank and its customers.

Banking license

A full banking licence certifies that you meet the legal criteria to operate as a bank. Having this licence means you can: offer payment services, manage customers‘ deposits, offer interest-bearing accounts, Issue credit cards, loans, and other lending products, Offer other financial services products such as bancassurance and wealth management. A full banking licence certifies that you meet the legal criteria to operate as a bank. To get a full banking licence, you need to apply to the financial services regulator in the country where you want to operate and prove that you meet the criteria.

Banking Training

Banking courses that provide a comprehensive understanding of the banking industry.

BIC (Bank Identifier Code)

It is an 8 to 11-character code that is used to identify a specific bank 

Big Data

Big data is a combination of structured, semistructured and unstructured data collected by organizations that can be mined for information and used in machine learning projects, predictive modeling and other advanced analytics applications.


Bitcoin (₿) is a decentralized digital currency, without a central bank or single administrator, that can be sent from user to user on the peer-to-peer bitcoin network without the need for intermediaries. Transactions are verified by network nodes through cryptography and recorded in a public distributed ledger called a blockchain. 

Blended Rate

An interest rate charged on a loan that represents the combination of a previous rate and a new rate. Blended rates are usually offered through the refinancing of existing loans that are charged a rate of interest that is higher than the old loan’s rate, but lower than the rate on a brand-new loan.

BNPL (Buy Now Pay Later)

Buy Now, Pay Later (BNPL) is a type of short-term financing that allows consumers to make purchases and pay for them at a future date, often interest-free.

BoE (Bank of England)

The Bank of England (BoE) is the UK’s central bank. Its mission is to deliver monetary and financial stability for the people of the United Kingdom.

Card Brand

Card brands are companies responsible for defining the business rules for purchases made with credit card. They are the ones who define the standards by which the acquirers must process the transactions carried out by this payment method (each brand has its own rules).

Card Issuing

The terms acquiring and issuing refer to where those banks are in the transaction flow. Put simply, the issuing bank is the cardholder or consumer’s bank.

Card Not Present (CNP)

A card-not-present (CNP) transaction occurs when neither the cardholder nor the credit card is physically present at the time of the transaction. It’s most common for orders that happen remotely — over the phone or by fax, internet, or mail.

Card Present

Card present transaction is one in which the customer physically interacts with payment machinery using his or her card. This can include swiping a card with a magnetic strip, inserting a card with an EMV chip or tapping a mobile device with the card loaded to a digital wallet. A transaction is only considered to be “card present” if payment details are captured in person, at the time of the sale.

Card Rail

Credit card rails are the credit card payment system.

Cashier System Provider (CSP)

The cashier is a sort of laying or buffering between the merchant and the payment processor, and allows merchants to get connected to multiple providers. The cashier will be responsible for providing special software that makes this happen.

CBDC (Central Bank Digital Currency)

CBDC utilizes technology to represent a country’s official currency in digital form. Unlike decentralized cryptocurrency projects like Bitcoin, a CBDC would be centralized and regulated by a country’s monetary authority.

Central Bank

Central bank is a public institution that manages the currency of a country or group of countries and controls the money supply – the amount of money in circulation.

CFT (Counter the financing of terrorism)

A core component of EU’s strategy in the fight against terrorism. As terrorists and their supporters constantly modify their ways to collect, move and gain access to funds, the EU needs to adapt its instruments and measures to deny them resources.


A chargeback is a charge that is returned to a payment card after a customer successfully disputes an item on their account statement or transactions report. A chargeback may occur on debit cards or on credit cards.

Chargeback rates

Chargeback rate is the percentage determined between the volume of confirmed transactions and the number of contested transactions. High chargeback rates mean a high percentage of money lost due to a high volume of chargeback requests from customers.

Checkout Pages

A checkout page refers to any website pages shown to a customer during the step-by-step checkout process. Think of a checkout pages as the online version of a physical checkout counter in a grocery store.


Clearing is the procedure by which financial trades settle; that is, the correct and timely transfer of funds to the seller and securities to the buyer. Clearing is necessary for the matching of all buy and sell orders in the market. It provides smoother and more efficient markets as parties can make transfers to the clearing corporation rather than to each individual party with whom they transact.

Closed Loop

A closed loop payments system operates without intermediaries. The end parties have a direct relationship with the payments system.

Closed Loop Mobile Payments

Enable consumers to load money into a spending account that is linked to a payment device – for example, a gift card for a specific company. An easier way to understand it is to think of closed payments as a gift card and open payments as a credit card.


Being “payment compliant” means that your company follows a certain set of standards of industry best practices and risk avoidance. It exists to protect your company and credit card companies from fraud and risk


The conversion rate – the proportion of visitors to your site that become paying customers – is where merchants need to be looking to grow their businesses.

Credit Card

A financial instrument issued by banks with a pre-set credit limit, helping you make cashless transactions. The card issuer (Bank) determines the credit limit based on your credit score, credit history and your income. A credit card is a payment card issued to users (cardholders) to enable the cardholder to pay a merchant for goods and services based on the cardholder’s accrued debt (i.e., promise to the card issuer to pay them for the amounts plus the other agreed charge).

Credit Risk

Credit risk is the possibility of a loss resulting from a borrower’s failure to repay a loan or meet contractual obligations.


A cryptocurrency is a digital or virtual currency that is secured by cryptography, which makes it nearly impossible to counterfeit or double-spend.

Debit Card

A Debit Card is a payment card that deducts money directly from a consumer’s checking account when it is used.

Digital currency

Digital currency ( digital money, electronic money or electronic currency) is any currency, money, or money-like asset that is primarily managed, stored or exchanged on digital computer systems, especially over the internet.

Distributed Ledger

Distributed ledger is a database that is synchronized and accessible across different sites and geographies by multiple participants.  It allows transactions to have public „witnesses.“ The participant at each node of the network can access the recordings shared across that network and can own an identical copy of it. Any changes or additions made to the ledger are reflected and copied to all participants in a matter of seconds or minutes.

EBA (European Banking Authority)

The European Banking Authority (EBA) is an independent EU Authority which works to ensure effective and consistent prudential regulation and supervision across the European banking sector. Its objectives are to maintain financial stability in the EU and to safeguard the integrity, efficiency and orderly functioning of the banking sector. The main task of the EBA is to contribute to the creation of the European Single Rulebook in banking whose objective is to provide a single set of harmonised prudential rules for financial institutions throughout the EU.


The term electronic commerce (ecommerce) refers to a business model that allows companies and individuals to buy and sell goods and services over the Internet.


The process of receiving or giving systematic instruction. Information about or training in a particular field or subject.

European Economic Area (EEA)

The European Economic Area (EEA) was established via the Agreement on the European Economic Area, an international agreement which enables the extension of the European Union’s single market to member states of the European Free Trade Association. The EEA links the EU member states and three EFTA states (Iceland, Liechtenstein, and Norway) into an internal market governed by the same basic rules. These rules aim to enable free movement of persons, goods, services, and capital within the European Single Market, including the freedom to choose residence in any country within this area. The EEA was established on 1 January 1994 upon entry into force of the EEA Agreement.

Electronic Identification, Authentication and trust Services (eIDAS)

‚eIDAS‘ is shorthand for ‚electronic identification and trust services‘. It refers to a range of services that include verifying the identity of individuals and businesses online and verifying the authenticity of electronic documents. The eIDAS regulation was created to provide a common foundation for secure electronic commerce between citizens, businesses and governments across European Member States.

Embedded Finance

Embedded finance refers to financial services offered seamlessly in consumers‘ everyday experiences through non-financial products and services.

Electronic Money Institution (EMI)

An electronic money institution is a company whose business it is to issue electronic money.


Electronic money (e-money) is broadly defined as an electronic store of monetary value on a technical device that may be widely used for making payments to entities other than the e-money issuer. The device acts as a prepaid bearer instrument which does not necessarily involve bank accounts in transactions. E-money products can be hardware-based or software-based, depending on the technology used to store the monetary value.

e-money license

An e-money licence allows you to offer payment services and some other financial services products, but not operate as a bank or use ‚bank‘ in your name or marketing materials.

European Union (EU)

The European Union (EU) is a political and economic union of 27 member states that are located primarily in Europe. An internal single market has been established through a standardised system of laws that apply in all member states in those matters, and only those matters, where the states have agreed to act as one. EU policies aim to ensure the free movement of people, goods, services and capital within the internal market.


E-wallet is a type of pre-paid account in which a user can store money for online transactions.


The payment facilitator is the company that provides the infrastructure necessary for their submerchants to begin accepting credit card payments.

FCA (Financial Conduct Authority)

Conduct regulator authority for around 51,000 financial services firms and financial markets in the UK. Its role is to ensure markets work well for individuals, for businesses and for the economy as a whole.


Fintech refers to the integration of technology into offerings by financial services companies in order to improve their use and delivery to consumers. Fintech is a term used to describe new technology that automates and improves the delivery of financial services. Fintech stands for „financial technologies“ but it isn’t just for those in financial institutions.

Fintech Training

Provides an in-depth understanding of every aspect of the FinTech Industry.

Fraud Risk

Fraud Risk is the risk of unexpected financial, material or reputational loss as the result of fraudulent action of persons internal or external to the organization.

FSCS (Financial Services Compensation Scheme)

The Financial Services Compensation Scheme (FSCS) protects customers from losing some of their cash if authorised financial services firms go bust. It protects up to £85,000 of savings per individual, per financial institution (not just per bank), and also covers mortgages, insurance and investments.

Fulfillment Provider

Fulfillment company is going install the necessary applications, inject encryption keys, and ship the terminals to the merchants. Some fulfillment companies also can do servicing of the terminals, as well as provide support and take inbound customer calls.


A payment gateway is the mechanism that reads and transfers payment information from a customer to a merchant’s bank account. Its job is to capture the data, ensure funds are available and get a merchant paid. Online, a payment gateway is cloud-based software that connects a customer to the merchant. In person, it’s the software built into a point-of-sale (POS) system or card reader that processes a transaction when the cardholder uses their card to make a payment.

GDPR (General Data Protection Regulation)

The General Data Protection Regulation (GDPR) is the toughest privacy and security law in the world. Though it was drafted and passed by the European Union (EU), it imposes obligations onto organizations anywhere, so long as they target or collect data related to people in the EU.

Gift Cards

A gift card is a prepaid debit card that contains a specific amount of money available for use for a variety of purchases. Store gift cards are designed to be used at specific merchants or retailers, while general-use prepaid gift cards are not affiliated with any specific merchant and can also be used to withdraw cash at automated teller machines.  Store gift cards (closed loop) are designed to be used for purchases at specific retailers, while general-use prepaid gift cards (open loop) may be used at a wider variety of locations.


The brand “Girocard” unites the electronic payment system “electronic cash” and the “Deutsche Geldautomaten-System” (German ATM system). Girocard is the most common debit card in Germany. Unlike credit card payments, Girocard payments and cash withdrawals are debited directly from your account.

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IBAN (International Bank Account Number)

International Bank Account Number (IBAN) is an internationally agreed system of identifying bank accounts across national borders to facilitate the communication and processing of cross border transactions with a reduced risk of transcription errors. An IBAN uniquely identifies the account of a customer at a financial institution.


iDEAL is a direct online transfer from your bank account to the bank account of an entrepreneur. With iDEAL you can make online payments in a reliable, secure and easy way. Payments are done using the mobile banking app or the online banking environment of your own bank.

Identity Management & Control

Identity management and access control is the discipline of managing access to enterprise resources to keep systems and data secure. As a key component of your security architecture, it can help verify your users‘ identities before granting them the right level of access to workplace systems and information.

Interbank Settlement

Interbank Settlement means the transfer of funds between the bank of the originator and the bank of the beneficiary in relation to a payment transaction.


Interchange refers to a fee that a merchant must pay with every credit and debit card transaction. Rates are set by payment card issuing companies in exchange for accepting the credit risk and handling charges inherent in these transactions. The Interchange fee is an important factor in determining the actual cost of accepting credit cards.

Interchange +

Interchange Plus is the common name for a pricing structure for accepting credit card transactions by merchants.

Interchange ++

Interchange++ is a type of pricing most commonly used in Europe and the North America. It’s available for payments made through Visa and Mastercard. It offers more transparency than other pricing types as it shows a more detailed breakdown of your costs.

ISO (Independent Sales Organisation)

An Independent Sales Organization is a sales force for hire used by acquirers that do not wish to staff and manage a sales force internally. Generally, ISO sales representatives receive a commission for each merchant they sign.


An issuing bank is the bank that issued the credit or debit card to the customer. They are members of the card networks, such as Mastercard and Visa.

ISV (Independent Sofware Vendor)

An individual or organization that develops, markets, and sells software solutions that run on one or more computer hardware providers like Macintosh, operating systems like iOS, or cloud platforms like Amazon Web Services.

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Klarna is the leading global payments and shopping service, providing smarter and more flexible shopping and purchase experiences to 147 million active consumers across more than 400,000 merchants in 45 countries. Klarna offers direct payments, pay after delivery options and instalment plans in a smooth one-click purchase experience that lets consumers pay when and how they prefer to. Klarna was founded in 2005 in Stockholm, Sweden with the aim of making it easier for people to shop online.

KYC (Know Your Customer)

The Know Your Client or Know Your Customer is a standard in the investment industry that ensures investment advisors know detailed information about their clients‘ risk tolerance, investment knowledge, and financial position. KYC protects both clients and investment advisors. KYC compliance typically involves requirements and policies such as risk management, customer acceptance policies, and transaction monitoring.

Loyalty Cards

Customer loyalty cards are used by businesses to encourage customers to return to their store for repeat business. Customer loyalty cards are especially beneficial to businesses because they only require rewards after the customer has already spent money with the business a certain number of times. Customer loyalty cards also give business owners a peek into customer buying preferences that can help you determine which incentives will be most enticing to your customer base.

Merchant Onboarding

Merchant Onboarding facilitates the system administrator to set up and maintain merchants using the channel banking platform. This, in turn, enables the users to initiate merchant based payments using the channel banking facility.

Merchant Settlement

Settlement is the process through which a merchant receives money paid by their end users for a particular product/service.

Mobile Phone Payment

A mobile payment is a money payment made for a product or service through a portable electronic device such as a tablet or cell phone.

Modified Customer Interface  (MCI)

The use of a modified customer interface is also colloquially referred to as ‚Screenscraping+‘ or SS+. The modified customer interfaces enables you to present a valid network level HTTPS/TLS certificate to identify yourself and you are then able to access the specific services you require.

MSC (Merchang Service Charge)

Merchant Service Charge is a fee paid by the merchant to the acquiring financial organization.Merchant Service Charges, known as (MSC) are the charges taken on every credit and debit card transaction that the business accepts. The majority of businesses compare merchant accounts this way, however the cheapest rate, does not necessarily mean it is the best deal for your organisation.  This fee is influenced by a wide range of aspects. Merchant service charges are different in different countries.  Merchants need to understand that the fee doesn’t fully go to the payment processor. The merchant service charge composes from three main elements: The interchange fee that goes to the issuing bank, The network fee that goes directly to Visa or Mastercard, The acquirer fee that goes to the acquiring bank.

MSP (Merchant Service Provider)

A merchant service provider or merchant account provider is a company or service that gives you access to all the tools you need to handle those all-important transactions. Your merchant service provider is responsible for everything from your point of sale, to your payment gateway.

National Competent Authority (NCA)

National competent authorities are organisations that have the legally delegated or invested authority, to perform a designated function, normally monitoring compliance with the national statutes and regulations.

NSF Risk (Non Sufficient Fund)

Non-sufficient funds is the term used when the holder of a checking account is overdrawn — meaning there is not enough money in the account to pay the check written against it. The bank returns the “bounced” check to the accountholder and charges a returned-check charge, or a non-sufficient funds (NSF) fee.

Open Banking

Open Banking is a system that provides third-party access to financial data through the use of application programming interfaces (APIs). Open banking is also known as „open bank data.“ Open banking is a banking practice that provides third-party financial service providers open access to consumer banking, transaction, and other financial data from banks and non-bank financial institutions through the use of application programming interfaces (APIs)

Open Finance

Open Finance is based on the principle that the data supplied by and created on behalf of financial services customers are owned and controlled by those customers. Re-use of this data by other providers takes place in a safe and ethical environment with informed consumer consent. Open finance is the next step in the open banking journey. It allows banks to gain and share access to all of your financial data. Open finance will lead to increased competition, better-tailored financial services, and improved overall financial health.

Open Loop

An open loop card is a general-purpose charge card that can be used anywhere that brand of card is accepted. It usually bears the logo of the card brand or network (which processes the actual transactions), such as Visa, MasterCard, American Express, or Discover.

Open Loop mobile payments

Open loop mobile payment solutions allow users to pay at many different locations from one centralized digital wallet. Unlike their closed counterparts, open platforms are connected to a personal account – a credit card for example – and don’t require a prepaid amount to exist in the system that needs to be topped up when the money runs out.


A payee is a party in an exchange of goods or services who receives payment. The payee is paid by cash, check, or another transfer medium by a payer.

Payment Acquirer

Acquirers, also known as Merchant Acquirers, basically collect card based payments which have been accepted from Retailers. They aggregate and separate those payments and then send them to Card Issuers, normally via the respective Card Scheme (e.g. Visa/MasterCard) networks, known as ‚interchange‘.

Payment App

Payment Apps or mobile wallet refers to the payment services operated under financial regulation and is performed using a mobile device. Mobile payment apps make it quick and easy to send money to people, without the need to mail a check or hand over cash. They can be ideal for splitting bills, paying back short-term loans or buying things online without a credit card. All things considered, mobile payment services are only as safe as you make them.

Payment Authorization

Payment Authorization is a process through which the amount to be paid on a payment method is verified. In case of credit cards, authorization specifically involves contacting the payment system and blocking the required amount of funds against the credit card.

Payment Authorization

Payment Authorization is a process through which the amount to be paid on a payment method is verified. In case of credit cards, authorization specifically involves contacting the payment system and blocking the required amount of funds against the credit card.

Payment Capture Method

Payment capture is a step in the payment flow that occurs after a customer pays with a credit card or some alternative payment methods and the payment is authorized. Before a payment is captured, the customer isn’t charged. Capture is the process by which payments are secured once the payment has been authorized. In order for a payment process to be complete when a credit or debit card is being used as the method of payment, the card must first be authorized. This step of authorization takes seconds and will allow the merchant to know that there are sufficient funds to complete the transaction.

Payment Education

Training Payment Professional Certificate. Educating a person on the Payment Ecosystem, players, key drivers, customer expectations, trends, etc.

Payment in Advance (PiA)

Letting your client know you expect them to pay the total amount due for a project upfront, before you begin work.

Payment Initiation Service Provider (PISP)

A PISP is a service provider who can execute a payment transaction on the behalf of a customer. Meaning they are able to withdraw money directly from your account, as long as you have given your consent. If you have more than one bank account, you can choose which account the money will be withdrawn from.

Payment Institution (PI)

Payment institutions are permitted to provide payment services alongside banks and other financial institutions. 

Payment Network

A payment network is an association of member banks that facilitates the payment transaction between the merchant and issuer, i.e., the requestor (cardholder to the merchant to acquiring bank) and source (issuing bank) of funds.

Payment Processor

A payment processor is a company that manages the credit card transaction process, acting as a kind of mediator between the bank and the merchant. Put simply, the payment processor communicates information from your customer’s card to your bank and the customer’s bank.

Payment Rail

„A payment rail is a payment platform that moves money from a payer to a payee. Either party could be a consumer or business, and both parties are able to move funds on the network. A payment rail is essentially the backbone to all digital transfers of money between one individual or organization to another, regardless of country, currency, or digital payment method.   The most popular payment rails include Automated Clearing House (ACH), Mastercard and other major credit card providers, PayPal, the RTP Network (for real-time payments) from The Clearing House, and blockchain.

Payment Reconciliation

Payment reconciliation is an accounting process that verifies account balances to ensure all sets of records are true, consistent, and up-to-date. Businesses can reconcile their accounts daily, weekly, or monthly.

Payment Scheme

A payment scheme is a set of rules which have agreed upon to execute transactions through a specific payment instrument (such as credit transfer, direct debit, card, etc). It is different from a payment system, which is a technical infrastructure that processes transactions in line with the rules defined in a payment scheme.  Payment schemes manage the day-to-day operations of the payment systems and processes and ensure any regulatory requirements associated with the processing of payments are met. Examples: Visa, Mastercard

Payment Service Regulations

Payment service regulations are the rules set out to ensure PSPs complete comprehensive due diligence to mitigate the risk of financial fraud.  Payment service regulations differ across jurisdictions. Some countries and international bodies – including the European Union, Singapore, and Canada – have modernized their frameworks in recent years, using a risk-based approach to address new business models based on offering multi-faceted services subject to both overlapping regulations and, in places, gaps in regulatory oversight.

Payment Service User (PSU)

Payment service user means a person making use of a payment service in the capacity of payer, payee, or both.

Payment System

A payment system is any system used to settle financial transactions through the transfer of monetary value. This includes the institutions, instruments, people, rules, procedures, standards, and technologies that make its exchange possible. A common type of payment system, called an operational network, links bank accounts and provides for monetary exchange using bank deposits.

Payment Training

The action of teaching a person or team specifics of the payment industry.

Payment Transaction Channel

Payment Transaction means an act, initiated by the Payer or on his behalf or by the Payee, of placing, transferring or withdrawing funds, irrespective of any underlying obligations between the Payer and the Payee. Payment channel information is a payment property that identifies the delivery method by which customer payments are sent to a financial institution. For example, payment channels include the Internet, Interactive Voice Response (IVR) phone service, Automated Clearing House (ACH).                                                               

Payment Value Chain

A payment value chain is a system that involves two or more parties that transact funds through a payment scheme. In the most simplified version of it, there’s the payer (consumer) and the payee (merchant). The Payments Value Chain lays out the steps in a business transaction beginning with the tools, enterprises use to manage their business and ending with the payment networks that help complete a payment.


The action or process of paying someone or something or of being paid.


PayPal is an online financial service that allows you to send and receive money using a secure internet account. You simply add your bank account, credit card, or debit card details, and your bank account is linked to your PayPal account. Whenever you pay using PayPal, the money will come out of your linked account.

PCI DSS (Payment Card Industry Data Security Standard)

The Payment Card Industry Data Security Standard (PCI DSS) is an information security standard for organizations that handles branded credit cards from the major card schemes. The standard was created to increase controls around cardholder data to reduce credit card fraud.


Plugin (also known as a plug-in) is a software that enables customization by adding a specific feature to the current computer program. Plugin`s primary goal is to enhance the program as well as to provide new capabilities.

POCA (Proceeds of Crime Act 2022)

The aim of POCA is to close loop-holes, ensuring criminals cannot use their assets, and to recover proceeds of the crime. This also deters business people from undertaking criminal activities, as well as influencing others to advise against criminal activities.

Point of Sale (POS)

Point of sale (POS) refers to the place where customers execute payments for goods or services.

POS Terminal

A point-of-sale (POS) terminal is a hardware system for processing card payments at retail locations. Software to read magnetic strips of credit and debit cards is embedded in the hardware. Portable devices (i.e., not terminals anchored to a counter), either proprietary or third-party, as well as contactless capabilities for emerging forms of mobile payments, represent the next generation of POS systems.

PSD2 (Payment Service Directive 2)

Payment Services Directive Two (PSD2) is a legislation which entered into force as of 13 January 2018 with the objective of making payments more secure, boosting innovation and helping banking services to adapt to new technologies.   Designed to force providers of payment services to improve customer authentication processes and to also bring in new regulation around third-party involvement.

PSD2 IFR (Interchange Fee Regulation)

Interchange Fee Regulation (IFR) aimed at fostering the competition in the market of EU card payments by introducing caps for high interchange fees for consumer debit and credit cards, therefore setting harmonized ceilings for interchange fees for consumer cards in the EEA.

PSP (Payment Service Provider)

Payment service providers – also known as merchant service providers or PSPs – are third parties that help merchants accept payments by connecting them to the broader financial infrastructure. They provide both a merchant account and a payment gateway, ensuring that businesses can collect and manage their payments in a simple and efficient way.

QR Payment

A QR code payment works exactly the same way as a ’normal‘ QR code, except when a user scans the code, it brings them to a web payment form. It essentially functions like a POS terminal – customers scan a code with their smartphones and complete the payment on the spot. QR code payment is a contactless payment method where payment is performed by scanning a QR code from a mobile app.

Quality Service Provider QTSP

 Payment providers, offering a range of solutions to improve company performance, are an integral part of the market chain. Aim to identify your goals immediately, outlining your target audience, markets of interest, and plans for further development.

Recurring payment

An ongoing payment on a periodic basis for a product or service.


A refund is when you have charged a payer, and need to cancel the payment and return the funds to the payer.

Regulatory Reporting

Regulatory reporting is the submission of data to a relevant authority in order to demonstrate compliance with the necessary regulatory provisions. It is the process businesses and individuals must continually go through to show they are following all the rules.


A retrieval request is a process through which a cardholder can request more information about a charge on their account, often in the form of a receipt for the purchase. It starts when a cardholder contacts their issuing bank to ask about a charge they don’t recognize on their account.

Risk Management

Risk management is focused on the analysis and reduction of risk in various types of activities. Risk management in banking is theoretically defined as “the logical development and execution of a plan to deal with potential losses”.

RTGS (real time gross settlement)

The term real-time gross settlement (RTGS) refers to a funds transfer system that allows for the instantaneous transfer of money and/or securities.

SAR (Suspicious Activity Reporting)

A financial institution is required to file a suspicious activity report no later than 30 calendar days after the date of initial detection of facts that may constitute a basis for filing a suspicious activity report. Under the Bank Secrecy Act (BSA), financial institutions are required to assist U.S. government agencies in detecting and preventing money laundering,

SCA (Strong Customer Authentication)

Strong customer authentication (SCA) is a requirement of the EU Revised Directive on Payment Services (PSD2) on payment service providers within the European Economic Area. The requirement ensures that electronic payments are performed with multi-factor authentication, to increase the security of electronic payments.


Visa and MasterCard, two of the largest global brands, offer credit and debit cards that have become synonymous with a payment type that is accepted around the world; these two huge brands are known as card schemes.

Scheme Fee

Scheme fees are unregulated fees charged by card schemes such as Visa, Mastercard, Diners and Union Pay. Card scheme fees are the fees paid by acquirers to be members of the scheme. Acquiring banks then pass the fees they pay on to the merchants (through credit card merchant fees), which each merchant pays either in each transaction or as a bundled charge.

SEPA (Single European Payment Area)

The SEPA (Single Euro Payments Area) is a pan-European network that allows you to send and receive payments in euros (€) between two cross-border bank accounts in the eurozone. With SEPA, sending money within the eurozone is as easy as making your usual domestic bank transfers

SEPA Direct Debit

SEPA Direct Debit is a Europe-wide Direct Debit system that allows merchants to collect Euro-denominated payments from accounts in the 36 SEPA countries and associated territories.

SEPA Instant

SEPA Instant is a new bank transfer technology that allows for euro transactions to be processed in seconds, regardless of the week’s time and day.


Payment settlement involves collecting the funds for the amount recorded for an order. For example, when using credit cards, the settlement process specifically involves contacting the payment system and collecting the required amount of funds against the credit card.

Settlement Agent

A settlement agent is a party who helps complete a transaction between a buyer and a seller. This is done through the transfer of securities to the buyer and the transfer of cash or other compensation to the seller.

Shop systems

„A shop system is the software that makes it possible to create an online shop. Depending on the provider, it includes more or less extensive standard functions, such as a shop database with product information, an administration database, presentation systems, a payment gateway for payment, a web tracking system.“

Small Data

It can be defined as small datasets that are capable of impacting decisions in the present. Anything that is currently ongoing and whose data can be accumulated in an Excel file. Small Data is also helpful in making decisions, but does not aim to impact the business to a great extent, rather for a short span of Small data can be described as small datasets that are capable of having an influence on current decisions.

Software as a Service (SaaS)

Software as a service (SaaS) is a software distribution model in which a cloud provider hosts applications and makes them available to end users over the internet.


A stablecoin is a digital currency that is pegged to a “stable” reserve asset like the U.S. dollar or gold. Stablecoins are designed to reduce volatility relative to unpegged cryptocurrencies like Bitcoin.  


The action of making or agreeing to make an advance payment in order to receive or participate in something.

SWIFT (Society for Worldwide Interbank Financial Telecommunications)

Society for Worldwide Interbank Financial Telecommunication (SWIFT), is a Belgian society providing services related to the execution of financial transactions and payments between banks worldwide. Its principal function is to serve as the main messaging network through which international payments are initiated. Provides a secure messaging system for financial transactions between participating banks.

Technical Service Provider (TSP)

Technical Service Providers (TSPs) are individuals or businesses that have technical expertise in conservation planning and design for a variety of conservation activities.

The Federal Financial Supervisory Authority (BaFin)

Brings together the supervision of banks and financial services providers, insurance undertakings and securities trading.

Third Party Provider (TPP)

A third-party service provider is defined as an external person or company who provides a service or technology as part of a contract.


The action of teaching a person a particular skill or type of behaviour.

Transaction Monitoring

Transaction monitoring refers to the monitoring of customer transactions, including assessing historical/current customer information and interactions to provide a complete picture of customer activity. This can include transfers, deposits, and withdrawals.

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VAR (Value Added Reseller)

A value-added reseller is a firm that enhances the value of third-party products by adding customized products or services for resale to end-users.

Virtual Cards

Virtural cards work exactly like physical bank card, they just live in your digital wallet on your phone instead of your physical wallet. Secured by encryption, they offer a safe and convenient way to pay online and in-store.

Virtualized Card vs Tokenized Card

„Virtual cards are regular payment cards reduced to their 16-digit primary account numbers (PAN). A fast and secure way to pay vendors and workers, virtual cards have been part of the payments landscape for almost twenty years. Like virtual cards, tokenized cards do not exist in a physical form. Unlike virtual cards, however, tokenized cards are not identified by a PAN. They are instead identified by a substitute string known as a token. The advantage of tokenized cards is that they can be very difficult to misuse, even if they fall into the wrong hands.

Thanks to tokenization, your personal information is much less likely to be compromised when you use a digital wallet than when you pay with a regular credit card. That is because only the token is stored in the merchant’s database — your PAN remains protected.“


A void transaction is a transaction that is cancelled before it settles through a consumer’s debit or credit card account.

Wallet Payment

“Wallet Payments” refers to payments made with a digital, virtual wallet. A characteristic of this payment method is that customers deposit a balance into their wallet and use that to conduct secure online payments.


a business that operates through a website, selling goods or services

Wechat Pay

WeChat Pay works as a wallet and is enabled on mobile phones, making the payment service easy and transparent to consumers. It can be used for making offline payments such as in taxis, supermarkets, and even street vendors. This coverage has allowed WeChat Pay to become the most-used payment method for Chinese consumers today. WeChat Pay came about in 2013, and its main difference to Alipay is that it functions as an additional feature within WeChat, China’s biggest social media and instant messaging app

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3D Secure

3D Secure an additional layer of card holder authentication on online card transactions. If a card holder is making a payment online and the bank detects that the transaction might be suspicious, the bank card issuer redirects them to a 3DS page for extra verification.

6AMLD (6th Anti-Money Laundering Directive)

The 6th AML Directive aims to harmonise the definition of predicate offences against money laundering by all member states. To adapt to the changing nature of the European threat landscape, now also include cybercrime and environmental crime.

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