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March 24, 2010
Now Offering: Free 30 minute consultaion!
December 18, 2009
We have added industry terms & web site setup for your education.
Industry Terms Website Setup
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 Industry Used Terms
Terminal – A stand alone machine that requires both a phone line or DSL and electricity to work. This swipe unit allows the card to be swiped and prints a receipt .
Virtual Terminal - A terminal that is online. The user logs onto a secure site and can either swipe the card using a swipe unit or Wedge or the user can key in the transaction information and then submit the card for approval – the transaction is processes immediately.
AVS - Address Verification System checks the address of the card holder. This is not required but if used will help additional fees from being added.
CVV1 - A three digit code that is on the back of the credit card and used to verify and help prevent fraud.
PCI Compliancy - This is a compliancy check that makes sure the card data can not be breached while with the merchant. All merchants need to be compliant. There are different levels of compliancy depending in the manner in which the credit card is processed and if they are storing the credit card information. Large fines can be passed to the merchant if a breach occurs.
Discount Rate – The fee or percentage that is charged to the merchant for a credit card that is processed.
Transaction Fee – The set price fee for each transaction, paid whether the card was charged or credited.
Pass Thru Fees – Fees that can be added to the base discount rate – this is generally added due to the way the card was processed or issued.
Gateway – The online system that helps the merchant process credit cards or checks by passing the data to the processor in a secure way.
Processor – The company registered with Visa, MasterCard, Discover or American Express and a sponsor bank. They settle the transactions that come through daily and usually deposit the funds on the 2nd day after the card was processed.
Issuing Bank – The bank that issues the credit card to a consumer or business.
Interchange – The dollar amount of the transaction that is passed through to the issuing bank including pass thru fees.
ISO – (Independent Sales Organizations) Companies registered with the Networks and is in business to sign up merchants with the ability to take credit cards or checks.
Swiped Rate – The discount rate charged for processing credit cards that are swiped through a mag stripe. This rate is generally lower than a keyed rate.
Keyed Rate – The discount rate charged when the credit card is not swiped, it is entered into a virtual terminal or manually entered into a terminal – This discount rate is usually higher.
CRM – (Consumer Relations Manager) A program online or software that keeps track of your clients and the contacts made. This program keeps track of the amount charged, amount paid, products purchased. Etc.
Networks – The company that owns the technology that moves the transactions and settles with the issuing banks and sponsor banks.
Charge Back – When the customer calls the issuing bank and wants their money back from the transaction. There are many ways a customer can get their money back. If the card is keyed a chargeback can be processed without notifying the merchant first. Chargebacks are also used by the processor and card associations to determine if the merchant operating the business in an acceptable manner. Typically you must be below 1% (transactions to chargeback ratio). If you are above 1% and have over 50 MasterCard chargebacks and 100 Visa chargebacks you will most likely be placed on the “Watch List”.
Watch List – As defined above, this list tracks merchants that qualify by being over 1% and over 50 MasterCard and 100 Visa chargebacks per month on an account. In the first months they request a chargeback reduction plan from the merchant – this is to assist the merchant continue processing credit cards. Fines are also assessed from the first month and can reach close to $100,000.
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