The merchantA business that accepts credit cards for goods or services. industry covers financial services, most often referring to processing services. These services allow merchants to accept transactions.
As the payments ecosystem becomes larger and more complex, the merchantA business that accepts credit cards for goods or services. services industry continues to grow with it. This industry includes both payment processors and merchantA business that accepts credit cards for goods or services. acquirers.
With the rise of eCommerce, merchantA business that accepts credit cards for goods or services. acquiring is undergoing a significant transformation. However, not all merchantA business that accepts credit cards for goods or services. service providers are created equal.
Today, we’re going to cover what merchantA business that accepts credit cards for goods or services. acquirers are, and why they matter. This will help you navigate one of the most critical components of your business — the ability to process payments, become more profitable and grow.
What Exactly Is a MerchantA business that accepts credit cards for goods or services. AcquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks.?
A merchantA business that accepts credit cards for goods or services. acquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks. is essentially a bank that hold’s your merchantA business that accepts credit cards for goods or services. account. When you make a sale, they deposit your transactionAn act between a seller and a cardholder that results in either a paper or an electronic representation of the cardholder’s promise to pay for goods or services received from the act. The action between a cardholder and a merchant that results in financial activity between the merchant and cardholder’s account..... Therefore, the term “merchantA business that accepts credit cards for goods or services. acquirer” is often interchangeable with “acquiring bank.”
In the payments processing world, an acquirer collects card-based payments accepted by merchants. However, it is often used more broadly since merchantA business that accepts credit cards for goods or services. acquirers can take on several roles.
MerchantA business that accepts credit cards for goods or services. acquiring activities can affect retailers in several ways, including:
- Recruitment
- Underwriting
- Support and service
- Chargebacks
- Account closures
It’s important to note that a merchantA business that accepts credit cards for goods or services. acquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks. is a bank — but not all banks are acquiring merchants. Since these banks are members of card networks, including MasterCard and Visa, they must follow specific regulations. To clarify, the payment networks that facilitate the processing of payments, including Visa and MasterCard are known as card schemes. Banks and other financial institutions become members of these card schemes.
Now, this is where things get a bit more complicated.
Many in the industry will refer to merchantA business that accepts credit cards for goods or services. acquirers in relation to a payments processorA large data center that processes credit card transactions and settles funds to merchants. A processor connects to the merchant on behalf of an acquirer via a gateway or POS system to process payments electronically. Processors edit and format messages and switch to bankcard networks. They provide files for clearing and settlement and other value-added services..... This is the entity that authorizes transactions and then routes them to the appropriate card network.
Regardless, a merchantA business that accepts credit cards for goods or services. acquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks. helps merchants with:
- Payment processing
- Customer authentication
- Card authorizationThe request to charge a cardholder for goods or services. Authorization must be settled in order to post the authorization to the cardholder’s account. If not processed within a certain time frame authorizations will be cancelled. The time period is usually from 3-7 days....
- Receiving money from the bank that issued the card
- Refunds, chargebacks, and returns
- Scheme fees charged by credit card companies
Bottom line — A merchantA business that accepts credit cards for goods or services. acquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks. acts like a “switch” that protects merchants from having to understand all the fine print and details associated with card schemes. They work with merchants to effectively and securely process payment.
Recommended reading: Your Complete Guide to Managed-Risk Merchant Services
Breaking Down the Payment Cycle
Whether you’re set up in-store, are at a trade show event, or sell products online, it only takes a second for a customer to tap their card or finalize a digital payment. The transactionAn act between a seller and a cardholder that results in either a paper or an electronic representation of the cardholder’s promise to pay for goods or services received from the act. The action between a cardholder and a merchant that results in financial activity between the merchant and cardholder’s account.... is almost instantaneously approved — but how does a merchantA business that accepts credit cards for goods or services. acquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks. fit into the picture?
The payment cycle looks like this:
Customer –> MerchantA business that accepts credit cards for goods or services. –> MerchantA business that accepts credit cards for goods or services. GatewayA payment gateway is a combination of hardware and software that provides merchants with the ability to perform real-time credit card authorizations from a website over the Internet. It’s the link between a merchant website and the processor. –> MerchantA business that accepts credit cards for goods or services. AcquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks. (Acquiring Bank) –> Card Scheme –> Issuing Bank –> Accepted
The merchantA business that accepts credit cards for goods or services. acquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks. processes transactions on behalf of you, the merchantA business that accepts credit cards for goods or services..
The issuing bank issues credit cards to consumers, acting as the customer middleman. In comparison, the merchantA business that accepts credit cards for goods or services. acquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks. is the middleman for the merchantA business that accepts credit cards for goods or services..
Understanding the Services Provided by MerchantA business that accepts credit cards for goods or services. Acquirers
Here’s how the payment processing cycle works.
Customer authentication
In the United States, two-factor authentication is not mandatory for every industry. However, it is required in healthcare, finances, law enforcement, government, and other sectors.
Since online shopping fraud is on the rise, many merchants, both on and offline, are considering an extra layer of security. Two-factor authentication helps confirm a user’s claimed identity. For “cardholder present” payment processing (meaning in-person), this is typically handled by CHIP and PINPersonal Identification Number used by a cardholder to authenticate card ownership for ATM or debit card transactions. The cardholder enters his/her PIN into a PIN pad. The PIN is required to complete an ATM/debit card transaction. processing at the point of sale (POS)The time and place a sale takes place. Also refers to the devices used to transmit the credit card transaction.. For online purchases, this is a bit more complex. The merchantA business that accepts credit cards for goods or services. acquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks. acts as a gatewayA payment gateway is a combination of hardware and software that provides merchants with the ability to perform real-time credit card authorizations from a website over the Internet. It’s the link between a merchant website and the processor. to the card issuerA bank that issues credit cards to consumers..
So, when a customer wants to buy something, you tally up the total and ask for their card details. Control is then passed onto the merchantA business that accepts credit cards for goods or services. acquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks.; the card scheme routes to the card issuerA bank that issues credit cards to consumers. for authentication. If strong customer authentication (SCA) is required, a one-time password will be requested. Once a customer confirms they are who they say they are, the merchantA business that accepts credit cards for goods or services. and acquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks. move onto payment authorizationThe request to charge a cardholder for goods or services. Authorization must be settled in order to post the authorization to the cardholder’s account. If not processed within a certain time frame authorizations will be cancelled. The time period is usually from 3-7 days.....
Card/payment authorizationThe request to charge a cardholder for goods or services. Authorization must be settled in order to post the authorization to the cardholder’s account. If not processed within a certain time frame authorizations will be cancelled. The time period is usually from 3-7 days....
As the merchantA business that accepts credit cards for goods or services., you will swipe a customer’s card. Your POSThe time and place a sale takes place. Also refers to the devices used to transmit the credit card transaction. system will then dial up the merchantA business that accepts credit cards for goods or services. acquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks. for authorizationThe request to charge a cardholder for goods or services. Authorization must be settled in order to post the authorization to the cardholder’s account. If not processed within a certain time frame authorizations will be cancelled. The time period is usually from 3-7 days.....
The acquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks. routes this request to the card scheme, which routes it to the issuerA bank that issues credit cards to consumers.. The issuerA bank that issues credit cards to consumers. checks that the customer has enough available funds, sending back a unique authorizationThe request to charge a cardholder for goods or services. Authorization must be settled in order to post the authorization to the cardholder’s account. If not processed within a certain time frame authorizations will be cancelled. The time period is usually from 3-7 days.... code to the scheme. The acquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks. then receives authorizationThe request to charge a cardholder for goods or services. Authorization must be settled in order to post the authorization to the cardholder’s account. If not processed within a certain time frame authorizations will be cancelled. The time period is usually from 3-7 days...., routing it to the POSThe time and place a sale takes place. Also refers to the devices used to transmit the credit card transaction. system.
This all happens in a matter of seconds.
Each night, merchantA business that accepts credit cards for goods or services. acquirers sort transactions into piles for each scheme. This eventually leads to the issuerA bank that issues credit cards to consumers. bank transferring the amount payable to the scheme’s bank account.
The merchantA business that accepts credit cards for goods or services. acquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks. also provides detailed information about transactions. These are intended for your records as a merchantA business that accepts credit cards for goods or services..
Do I Need a MerchantA business that accepts credit cards for goods or services. AcquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks.?
In 2018, merchantA business that accepts credit cards for goods or services. acquirers provided services to around 10.6 million merchants.
Whether you are operating a business online, in a physical brick-and-mortar location, or both, you may need to partner with an acquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks..
If you are charging customers using a point of sale, card reader, or virtual terminalA web based credit card terminal that merchants can process sales through from any location that they have Internet access from., you will not need to sign a contract with a merchantA business that accepts credit cards for goods or services. acquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks.. Instead, the company you partner with for these payment services will work directly with a merchantA business that accepts credit cards for goods or services. acquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks.. As the merchantA business that accepts credit cards for goods or services., you will generally pay a transaction feeA fee charged for each transaction processed by the merchant. This is in addition to the percentage discount fees..
Once card information is collected from the payment gatewayA payment gateway is a combination of hardware and software that provides merchants with the ability to perform real-time credit card authorizations from a website over the Internet. It’s the link between a merchant website and the processor., a merchantA business that accepts credit cards for goods or services. acquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks. will be responsible for the authorizationThe request to charge a cardholder for goods or services. Authorization must be settled in order to post the authorization to the cardholder’s account. If not processed within a certain time frame authorizations will be cancelled. The time period is usually from 3-7 days.... and authentication. However, if your company processes payments yourself, you will be required to have a merchantA business that accepts credit cards for goods or services. acquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks.. There are some exceptions to this, but for the most part, you’ll need a merchantA business that accepts credit cards for goods or services. acquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks. to offer a one-stop shop for your merchants.
NMA Is Here for You
NMA is an innovative merchantA business that accepts credit cards for goods or services. services provider, pro-business advocate, and payments acquirerAny bank, financial institution, and public or private company that maintains a seller’s credit card processing relationship and receives all transactions from the seller to be distributed to the credit card issuing banks. transforming the financial services industry.
Being a trusted partner for over 15 years means NMA has revolutionized the payment processing space. We proudly stand behind our signature, “We Work For You™.”
We understand that your business is unique and requires a customized, tailored approach.Visit our website to learn more and to get started today!