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| Term | Definition |
|---|---|
| Provider | Payment Gateway/Payment Aggregator/PSP used to process a transaction. Example - Stripe, Braintree, Razorpay etc |
| 3DS | Three-Domain Secure - A security protocol for online card payments that adds an additional authentication layer |
| Authentication Attempted | Status indicating that 3DS authentication was initiated for a transaction |
| Authentication Declined | Status indicating that 3DS authentication failed or was rejected |
| Authorization | Process of verifying if a card has sufficient funds and is valid for a transaction |
| Authorization Success | Status indicating that a transaction has been successfully approved by the issuing bank |
| AVS | Address Verification Service - A security feature that compares the billing address provided by the customer with the address on file at the card-issuing bank |
| Blended Rate | Average cost of accepting payments. Calculated as the sum of total fees (transaction and platform fees) divided by the net volume (charges minus chargebacks and refunds) |
| Blended Rate Model | A pricing model where all fees (interchange, scheme fees, processor markup) are combined into a single rate for the merchant |
| Card BIN | Bank Identification Number - The first 6-8 digits of a card number that identify the issuing bank and card type |
| Card Brand | The brand visible on the card, which can be either the main network brand (like Visa) or co-branded with other entities |
| Card Network | The infrastructure and systems that process card payments, operated by card schemes |
| Card Scheme | Organizations (like Visa, Mastercard) that set the technical specifications and rules for card payments and manage the payment networks |
| Card Type | Classification of payment cards as Credit, Debit, or Prepaid, each with different processing rules and fees |
| Challenge Flow | In 3DS, when the customer must provide additional verification (like an OTP) to complete authentication |
| Chargeback Lost | When a dispute is resolved in favor of the cardholder, requiring the merchant to return the funds |
| Chargeback Won | When a dispute is resolved in favor of the merchant, allowing them to retain the transaction amount |
| CVC | Card Verification Code - A 3 or 4-digit security code printed on payment cards (also known as CVV, CSC, etc.) |
| Decline | When a transaction is rejected by the issuing bank or payment processor |
| Dispute | When a cardholder questions a transaction, potentially leading to a chargeback |
| Frictionless Flow | In 3DS, when authentication is completed without requiring additional customer input |
| Gross Revenue | Total sum of all captured transactions before deducting refunds and chargebacks |
| IC+ Pricing Model | Interchange Plus pricing model where the merchant pays the actual interchange fee plus a markup |
| IC++ Pricing Model | Interchange Plus Plus pricing model where the merchant pays the actual interchange fee plus scheme fees plus a markup |
| Interchange Fee | Fee paid between banks for the acceptance of card-based transactions. Interchange fee is typically paid by the merchant's bank (acquiring bank) to the customer's bank (issuing bank) and is fixed by card brands or government regulations |
| Issuer | The bank or financial institution that issues payment cards to consumers |
| Issuer Country | The country where the card-issuing bank is located |
| Net Revenue | Gross revenue minus refunds, chargebacks, and fees |
| Network Tokens | Network tokens are unique, cryptographically-secured digital representations of payment card details issued by card networks, replacing sensitive card information to enhance transaction security and reduce fraud risks. |
| Order | A customer purchase request that may contain one or multiple transactions |
| Platform Fees | Fee charged by the Provider that can't be tied to one particular transaction but is instead cumulated across multiple transactions or as a recurring fee for a month |
| Provider Transaction ID | Unique identifier assigned by the payment provider to track a specific transaction |
| Refund | Return of funds to a customer, initiated by the merchant |
| Second Chargeback | Also known as "pre-arbitration," occurs when a chargeback decision is challenged and disputed again |
| Settlement | Process of transferring funds from the acquiring bank to the merchant's account |
| Settlement Currency | The currency in which the merchant receives the payment |
| Settlement ID | Unique identifier assigned to a batch of transactions that are processed and settled together |
| Shopper Country | The country where the customer is located when making the payment |
| Shopper Interaction | The way a customer initiates a payment (e.g., online, in-person, recurring) |
| Shopper Interaction - CIT | Customer Initiated Transaction - Payment explicitly initiated by the customer |
| Shopper Interaction - MIT | Merchant Initiated Transaction - Automated payment initiated by the merchant based on prior customer agreement (e.g., subscriptions) |
| Tokenization | Process of replacing sensitive card data with a unique identifier (token) for secure storage |
| Transaction | A single instance of a paymentbeing processed through the payment system |
| Transaction Currency | The currency in which the customer makes the payment |
| Transaction Fees | Fee charged by the Provider for a transaction |
| Visa RDR | Rapid Dispute Resolution - Visa's automated dispute resolution process that helps prevent formal chargebacks |
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