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A to Z of Payments

Written by  Siddarth Tuesday, 30 May 2017 07:03

 

Aggregation

Aggregation in payments is the overarching theme since the early 2000’s. Payment aggregators bring together all kinds of digital payments in one platform, thereby helping businesses and consumers to collect/pay using one interface. These are typically non-bank entities.

 

Bitcoin

This is the newest kind of digital currency in town. Bitcoins offer unprecedented security and transparency through a concept called Block chain. Transactions using bitcoin occur directly between the payer and the payee and each transaction is recorded in a ledger called block chain. Recently, the value of 1 bitcoin surpassed the value of I ounce of gold!

 

 

CVV

CVV stands for Card Verification Value. Each credit/debit card uses this as a factor of authentication. This is typically present on the reverse of the card.

 

Data Security Standard

DSS is typically set by the Payments Card Industry (an industry body). This is a proprietary standard set for companies that process credit card payments. These standards ensure that there is no data theft and fraud while processing these payments.

 

 

EDC machine

EDC machine is a hardware device which allows a merchant to either swipe a card or insert a chip based card and process the payment. EDC machine is the most prevalent mode of processing digital/card based payments.

 

Factors

These are defined as security measures that are used to prevent frauds. CVV /Signature are typically one Factor used while an OTP or password is the second Factor. All payments in India are 2FA (2 factor authenticated) while payments abroad might use only one factor.

 

 

Gateway

A gateway typically connects a merchant and the issuer of the instrument. Gateways allow a secure passage for sensitive information to flow between the merchant where the payer is paying and the bank or issuer where the authentication is done.

 

Hot list

A hot list is a negative list of cards that will not be honored when presented for payment. When somebody calls a bank or an issuer, asking to block a card, the card is immediately placed in the hot list.

 

 

Instrument Issuer

An instrument issuer is defined as something that can store money. Issuers are typically banks who “issue” or give you the right to choose a payment instrument. On cards, there are typically two brands, one is that of the network (Visa/Master etc) and the other logo that belongs to an issuer. It is typically a bank that will authenticate the payment and also honor the payment if authenticated successfully.

 

Japan Credit Bureau

Japan Credit Bureau is a credit card network/issuer that is the largest in the Japanese market and is also widely accepted everywhere. It is allied with the Discover network in the United States to increase acceptance.

Read 795 times Last modified on Thursday, 01 June 2017 06:17