Defined below are several terms found in
the Merchant Bankcard Services Agreement
and shall have the following meanings. Please
refer to additional documents within the
Merchant Services Guide for definitions
of terms relating to those specific topics.
Acquiring
Bank
The financial institution that settles
card transactions for a merchant.
Address Verification
System (AVS)
A system built into the authorization
process that enables a merchant to verify
the United States billing address of the
customer to be the billing address the
Issuing bank currently has on file.
Average Ticket
Size
The total dollar amount of a single transaction
approved to be processed through a merchant
account. Card Association MasterCard International,
Visa U.S.A., Visa International and any
other association and/or network assigned
to the Merchant Bankcard Services Agreement.
Card Verification
Value - Visa (CVV 2)
Card Validation Code - MasterCard (CVC
2)
A three-digit value printed in the signature
panel on the back of a MasterCard or Visa
card. This value is a security feature
designed to crosscheck the information
embossed on the card.
Cash Reserve
Account Days The number of days as indicated
in the Merchant Bankcard
Services Agreement that funds will be
set aside in the Reserve Account.
Cash Reserve
Amount Percentage
The percentage of settled transactions
set aside in the merchant Reserve Account.
Chargeback
The return of a transaction from the cardholder’s
bank generated from a cardholder’s dispute
or resulting from the authorization process.
Chargeback
Ratio
The amount of sale transactions divided
by the amount of chargebacks received
in any given month. This is calculated
using either the item count of both or
the dollar amount of both.
Demand Deposit
Account (DDA)
A checking account, which must be linked
to a merchant processing account to deposit
funds to and debit funds from as needed.
Digital Certificate
An authentication system that confirms
a website is registered to the correct
individual(s) through a thorough validation
process.
Discount Rate
The percentage of the total transaction
amount, debit and credit, that is deducted
from the amount deposited to the merchant
account.
Electronic
Commerce Transaction
A transaction conducted over the Internet
or other network where a cardholder enters
card data and transmits the data. This
includes email, electronic order forms,
and interactive websites.
ETC Type
Electronic Ticket Capture code that identifies
the method that a merchant settles transactions.
Inquiry Fee
A fee imposed for all card types (MasterCard,
Visa, American Express, Diners Club, JCB,
etc.) each time an authorization is requested
and/or a batch is closed.
Issuing Bank
The financial institution that issues
a card to a consumer. Monthly Bankcard
Volume The total dollar amount of MasterCard
and Visa transactions approved to be processed
through a merchant account in any given
month.
Payment Gateway
The transaction processing vehicle that
receives encrypted transactions from the
merchant server, authenticates the merchant,
decrypts the payment information, and
transmits the data to the authorization
and settlement networks.
Reserve Account
Merchant funds maintained at BankCard
USA to be utilized for any potential losses
generated from a merchant account, such
as unpaid chargebacks or other unpaid
fees.
Retrieval
Request
A request from the cardholder’s bank to
supply a copy of
the sales draft usually for research of
a dispute.
Secure Electronic
Transaction (SET)
A future industry standard that will authenticate
customers and merchants to ensure the
safety and confidentiality of data processed
over the Internet.
Terminal A hardware device equipped with
a magnetic strip reading device utilized
for processing of card transactions, typically
used in a retail (face-to-face) environment.
Transit Routing
Number / ABA #
A nine-digit identification number assigned
to a financial institution necessary to
authenticate automated clearinghouse (ACH)
transmissions regarding a merchant account.
