CPP Study Deck 2 Flashcards
Client Organization
A company or organization that sponsors a Commercial card program; such as Business; Corporate; Purchasing (including Fleet); and any other program combining the functionality of these cards; in which cards are provided to users for business-related purchases. Such companies or organizations may be public- or private-sector companies; including sole proprietors and self-employed individuals.
Client Reference Number
An eight-digit number supplied by the establishment for electronic draft capture; electronic cash register; or direct solutions transactions.
Click Rate
On a Web page menu item; especially an advertisement; the ratio of the number of times it is selected (∫clicked∫) to the number of times it is viewed.
Client-Server
Any hardware-software combination that generally adheres to client-server architecture; regardless of the type of application.
Client-Server Architecture
Any network -based software system that uses client software to request a specific service; and the corresponding server software to provide the service from another computer on the network
Close Batch
The end-of-day or end-of-shift process in which the merchant balances and submits transactions for clearing and settlement. This process occurs on a terminal-based capture system. On a host-based capture system the host automatically generates the process at a predetermined time of day.
Closed-Loop
A system using a prepaid card within a boundary or a select group of merchants or at one particular merchant; such as mall cards that can only be used in the issuing shopping mall; major retailers such as Best Buy and Home Depot and campus cards that can only be used on the issuing campus. This type of program uses a proprietary network.
Closed System
A payment card system in which one organization both issues cards and acquires merchants. American Express and closed loop gift cards are examples of closed systems.
Co-Branded Cards
A customized branded card product for a specific retailer or service provider; such as General Motors; that wishes to solicit its customers.
Code “10”
A call made by a sales associate to the merchantπs voice authorization center when the appearance of a card or the actions of a cardholder suggest the possibility of fraud. The term ∫Code 10∫ is used so calls can be made without arousing suspicion while the cardholder is present. Specially trained operators then provide assistance to point-of-sale staff on how to handle the transaction.
Code of Federal Regulations (CFR)
The compiled administrative procedures by which federal agencies administer the laws passed by the U.S. Congress.
Cohabitation
The ability of multiple technologies to reside on the same card and not interfere with each other. An example is a magnetic stripe card with a chip embedded.
Cold Call
A lead-generation technique in which a salesperson calls on new businesses either physically or by telephone.
Collateral
Savings; bonds; insurance policies; jewelry; property; or other items that are pledged to pay off a loan or other debt if payments are not made according to agreed upon terms. Synonym: Security.
Collateral Material
Printed; broadcast; or other communications regarding marketing; including solicitations; promotional materials; advertisements; statements; statement inserts; direct mail solicitations; brochures; and telemarketing operator scripts.
Collected Funds
Funds for which final payment has been received.
Collections
A status or process by which borrowers or clients/customers have defaulted on their debts. Many companies hire collection agencies that specialize in recovering all or a portion of these debts for a fee. The fee sometimes includes a portion of the recovered monies.
Combined Terminated Merchant File (CTMF)
A database maintained by the card companies that lists all merchants terminated for cause.
Combined Warning Bulletin
The printed list of blocked numbers published jointly by Visa U.S.A. and MasterCard International. This list was discontinued in April 1994.
Commercial Card
A credit or debit card issued to businesses and corporations for travel and entertainment; fleet; business-related expenses; and procurement.
Commercial Card Enhanced Data Transport
A service that enables issuers to provide their Visa Commercial card customers with optional enhanced reporting of transaction information provided by merchants and acquirers.
Commercial Credit
Short-term credit that a seller gives to a buyer to pay for a service or product.
Commercial Relationship
An agreement between parties to do business together for the purpose of EBPP/EIPP. It may or may not include a contract.
Commercially Reasonable Time Frame
A period of time generally considered acceptable for a process in a given industry; taking into consideration the circumstances of the parties to the transaction. (Source: Billing.org)
Commission-Only Sales
Sales personnel who are not employed by a company but receive commissions instead of a salary when they effect a sale. These personnel are also considered “1099” personnel because they are issued IRS Form 1099 as proof of wages and for tax filing purposes.
Communications Processor Unit (CPU)
A computer embedded in a communications system. CPU is also an abbreviation for the central processing unit of a computer.
Compliance
A process for resolving disputes between card companies arising from violations of the operating regulations and verification by the member that a financial loss has occurred.
Compliance Filing
A formal case filing (on a completed regulations/rules violation form) submitted following an unsuccessful good-faith attempt to resolve the dispute.
Computer-Based Training (CBT)
Lessons or classes designed for self-study from computer programs.
Concentrator
- In data transmission; a functional unit that permits a common path to handle more data sources than there are channels currently available within the path. A concentrator usually provides communication capability between many low-speed; usually asynchronous channels and one or more high-speed; usually synchronous channels. Usually different speeds; codes; and protocols can be accommodated on the low-speed side. 2. A device that connects a number of circuits; which are not all used at once; to a smaller group of circuits for economy. (Source: Federal Communications Commission)
Concentrator
A financial institution or third-party service provider that a biller retains to handle payment and/or remittance data.
Confidentiality
The guarantee that a message will be legible to no one other than the intended recipient.
Confirmation
The acquirer’s electronic acknowledgment of the retrieval request.
Confirmation Number
A number provided by a hotel; motel or auto rental to verify a cardholderπs guaranteed reservation or advance resort deposit.
Confirmed Fraud Transaction
A transaction; reported by an issuer to the card companies; involving a card that was lost; stolen; never received; issued on a fraudulent application; counterfeit; or used fraudulently.
Congestion
Density of traffic when the load exceeds the capacity of a data communication path. (Source: Federal Communications Commission)
Connection Endpoint (CE)
A terminating device at one end of a layer connection within a service access point. Within VisaNet (Visa’s network); Visa Access Point (VAP) serves as the connection endpoints. Within BankNet (MasterCard’s network); MasterCard Interface Processor (MIP) serves as the connection endpoints.
Consolidator
A bill service provider that consolidates bills from multiple billers or other bill service providers (BSPs) and delivers them for presentment to the customer service provider (CSP). (Source: Billing.org).
Consumer
A person not engaged in commercial transactions.
Consumer Cards
The term used to identify all personal credit and debit cards.
Consumer Fraud
The commission of fraudulent acts by a consumer against a merchant. Some examples include writing bad checks; closing an account or having no account for checks; or intentional chargebacks.
Consumer-Operated Terminal (COT)
A self-service; usually a freestanding device such as an ATM or kiosk where the consumer initiates and consummates a transaction without the aid of a clerk. See also Cardholder- Activated Terminal.
Contact Smart Card
A smart card that connects to the reading device through direct physical contact between the smart card chip and the smart card reader. See ISO/IEC 7816. (Source: Smart Card Alliance)
Contactless Smart Card
A smart card whose chip communicates with the reader using RF (Radio Frequency) and does not require physical contact with the card reader. (Source: Smart Card Alliance)
Contactless Chip with dCVV/CVC3
The dCVV (Visa) and CVC3 (MasterCard) technology is a unique transaction identifier that is generated based upon public key/private key technology in combination with use of a contactless chip (discussed in the Contactless Chip Payments section). This transaction code is transmitted to the issuer for decryption and comparison to authenticate that the transaction being generated came from a valid card.
Controller
The device that captures and consolidates transactions from a group of terminals to be transmitted to another node or entity. For example; the POS devices in all lanes of one store are first transmitted to one store controller and then transmitted to an acquirer.
Control Panel
The access control system component that connects to all door readers; door locks; and the access control server. The control panel validates the reader and accepts data. Depending on the overall system design; the control panel may next send the data to the access control server or may have enough local intelligence to determine the user’s rights and make the final access authorization. Also called the controller or panel. (Source: Smart Card Alliance)
Control Totals
The amounts—usually representing the number of items; their total or other key information—used to help verify that received files are unchanged from the original transmitted files.
Controlled Disbursement
A disbursement arrangement in which a company is notified early in the day of the dollar amount of the items waiting to clear the account later that day; so they can fund the account with the exact amount to clear the items.
Convenience Card
A closed-loop prepaid card that is used by consumers to replace cash. The most successful of these card programs is the Starbucks card.
Convenience Check
Checks issued by credit or prepaid card companies to allow the cardholder an additional access to their line of credit or prepaid card balance; mostly for use in situations that do not take physical credit cards. In the case of a prepaid convenience check; the consumer would call the issuer for a confirmation number to be placed on the check. The check is now valid at retailers for cash.
Convenience User
A cardholder who pays an account balance in full on or before each payment due date. These cardholders incur no interest rate charges and are said to be taking advantage of the float of their funds; which could be the maximum of 30 days usage of money; without a charge.
Cookie
A small chunk of information stored on a computer by a Web site the user has visited that reminds that site about the user on the next visit. (Source: Federal Communications Commission)
Corporate Executive Card
A card serving senior executives and VIPs of mid-to large-size corporations. It has many enhancements to accommodate their meetings and trips; such as an automated expense report.
Corporate Fleet Card
Designed especially for shipping companies; the Fleet Card is a payment system for fuel and maintenance expenses. Every major trucking company issues a fleet card. Any driver can use it; but it can be limited for use only on particular vehicles.
Corporate Purchasing Card
A card that provides an efficient management system for companies’ purchasing processes and includes enhancements such as vehicle rental insurance; medical insurance for travelers; and travel and legal referral services.
Correction
A transaction conducted to correct an error after the customer has left the point-of-sale. It results in a credit adjustment entered as an online reversal or; if the error is discovered after cutover; as an offline adjustment.
Correspondent Bank
A bank that accepts deposits and performs banking services for other banks. Correspondent banking arrangements exist between local banks and banks located throughout the world.
Co-Sign
To sign a credit agreement with someone and share the debt with that person. The co-signer has liability if the primary or other person defaults. This practice is common for first-time credit applicants; especially parents for their children.
Co-Signer
The individual who has shared in the responsibility for the credit debt.
Cost of Capital
A company’s overall cost of funding their business may be made up of a combination of debt and equity costs. (Source: American Express)
Cost of Debt
A company’s cost of borrowing funds. If a company uses 100 percent debt to finance receivables; then the cost of funds will be equal to the cost of debt. (Source: American Express)
Cost of Funds
The dollar cost of interest paid or accrued on funds from various sources within a bank or lending institution. (Source: American Express)
Cost of Goods Sold (COGS)
The cost of direct materials; direct labor; and overhead attached to the units sold. The amount of money required to produce and distribute products or goods; including the cost of sales personnel to solicit and consummate a contract with a merchant.
Counterfeit Card
A plastic card that has been fraudulently printed; embossed; or encoded to appear to be a genuine bank card but has not been authorized by the card companies or issued by a member. A card originally issued by a member but subsequently altered without the issuerπs knowledge or consent.
Counterfeit Paper
Paper originating from the use of counterfeit cards for transactions.
Credential
The general identification device (both the physical device and the data it holds); commonly referred to as the ID token in physical access control systems. (Source: Smart Card Alliance)
Credit or Return
The return of a purchased item that results in the adding of the amount back to the cardholder’s line of credit. In a debit card environment; the credit or return transaction is a deposit to the debit cardholder’s access account. The merchant is debited the amount of return or credit.
Credit Authorization
The process of accessing a network and a database to verify that the customer’s credit card is valid and that the credit balance is sufficient to cover the purchase.
Credit Balance
On a revolving line of credit; the amount that the cardholder currently owes.
Credit Bureau
A company that keeps records of credit history for any card or loan. Anyone with authority to approve loans or lines of credit will examine a credit for the individual or company to determine their risk. The most common credit bureau agencies in the United States are Equifax; Experian (TRW); and TransUnion.
Credit Cap
The limit on the dollar amount of credit transactions that a company can originate from an account or entity.
Credit Card
Plastic cards that allow payments to be offset against a special-purpose account associated with a revolving line of credit and requiring some form of installment-based payment.
Credit Card Processor
A financial institution or its agent or third party that processes credit card or debit card transactions.
Credit Card Protection Service
Card registration and protection services offered through an agent that records the names; numbers; and issuers of the cards that the cardholder wishes to register and protect. When a card is lost or stolen; the issuer calls the service; and the service in turn notifies the card issuers.
Credit Counseling
Companies with professional counselors that give advice about using credit responsibly and consolidating debt.
Credit Deposit
The value of a merchantπs credit card purchases that are credited to its bank account after the acquiring bank buys the merchantπs sales slips; also called deposit credit. The deposit is credited but not funded until the acquiring bank gets the monetary value from the issuer during settlement.
Credit Draft Transaction
An offline manual food stamp transaction used to credit the cardholder’s account for the refund of a food stamp purchase.
Credit Life Insurance
Insurance that covers accounts with outstanding balances in the case of the death of the cardholder or a serious illness that makes the cardholder unable to pay the bill.
Credit Limit
The maximum amount the cardholder may owe to the issuer on the card account at any time.
Credit Loss
The amount lost (charged off) as a result of the cardholder’s failure to repay the amount owed on the account.
Credit Policy
The risk management guidelines detailing criteria to be evaluated before the issuance of a card to a cardholder or the approval of a merchant for card acceptance. The policy defines the acceptable level of risk for the portfolio.
Credit Rating/Grade
The measurement of a consumer’s or business’s credit worthiness. Normal grades are A through E.
Credit Record
An individual’s credit history.
Credit Report
A summary of an individual’s credit history. This report also includes facts such as age; address; marital status; employment history; and other information used to help a potential creditor evaluate credit worthiness.
Credit Risk
A party to a transaction is unable to meet its financial obligations either when due or at any time in the future.
Credit Scoring
A method for predicting the credit worthiness of a credit card applicant through statistical analysis.
Credit Schemes
A type of fraud that occurs when merchants or collusive employees deposit what appear to be legitimate transactions and then issue one or more credits to their personal Visa or MasterCard accounts. The credits zero out the sales; making such scams more difficult to detect.
Credit Slip
A paper or electronic representation of credit; issued to a cardholder on a prior credit card sale. Also called a credit voucher.
Credit Transaction
A payment transaction that pushes funds from the CSP or CPP to the BPP. (Source: Billing.org)
Credit Union
A democratically owned and controlled nonprofit financial cooperative that offers a variety of savings and lending services to members. Typically associated with a corporation or employer; such as the federal credit union used by Postal Service workers.
Creditworthy
Qualified to have credit.
Cross-Border Payments
ACH payments made between accounts in different countries; from the payment system of the country of origin through a gateway operator to the payment system of the country of receipt.
Cryptographic Algorithm
The formulas and key management processes used to encrypt and decrypt data and messages.
Cryptography
The science of ensuring that messages are secure.
C-Store
A term referring to a convenience store; such as 7-Eleven.
CTO (Corporate Travel Online)
An American Express travel reservation tool that allows users to book air; hotel; and car reservations online; 24 hours a day; 7 days a week. (Source: American Express)
CTX (Corporate Trade Exchange)
ACH entry format for corporate payments that include ANSI X12 or UN/EDIFACT payment-related records.
Current Account
A cardholder account on which payment is up to date and no amount is overdue.
Currency Conversion
The act of converting the dollar amount of the currency of the cardholder’s issuing country to the merchant’s acquiring country’s currency at the time of purchase. See Dynamic Currency Conversion.
Custom Payment Services (CPS)
Visa interchange rate structure that began in 2000 as PaymentService; designed to meet the special card acceptance and operating procedures of different types of merchants and cards.
Customer
An individual or entity that receives goods or services subject to bills; invoices; or statements.
Customer Identification Program (CIP)
A rule as a result of the USA Patriot Act of 2001 that requires financial institutions to implement procedures to collect identifying information on new accounts; verify customer identity; maintain identification records; and determine if the customer appears on any list of suspected terrorists or terrorist organizations.
Customer-Initiated Entry (CIE)
An automated consumer transaction that allows consumers to originate an ACH bill payment through their financial institution or a third-party bill payment service.
Customer Payment Provider (CPP)
An agent of the customer that originates payments on behalf of the customer.
Customer Relationship Management (CRM)
A formal program for the management of relationships. Also called client relationship management.
Customer Service
The operational department that services the cardholder and the merchant. The customer can write; call; or go online with questions about billing; payments; processing; and disputes. This department services or supports the client on processing issues and typically is separated from the help desk; which is a technical support group.
Customer Service Provider (CSP)
An agent of the customer that provides an interface directly to customers; businesses; or others for bill presentment. Among the CSP’s functions are enrolling customers; enabling presentment; and providing customer care. (Source: Billing.org)
CVC—(Card Validation Code)
A MasterCard tool used to prevent fraud. MasterCard requires that the number located on the back of the card and above the magnetic stripe be entered with the transaction to verify that the card is present and authentic
CVV—(Card Verification Value)
A Visa card’s unique check value encoded on a magnetic stripe and replicated in a chip to validate card information during the authorization process.
Cyberspace
A term coined by the science-fiction novelist William Gibson in his fantasy novel; Neuromancer that is used to describe the world of computers; especially the Internet. (Source: Federal Communications Commission)
Cycle
The grouping of cardholder accounts to provide for a distribution of workload and easier account identification.
Cycle Billing
The preparation of monthly cardholder statements by group (cycle) for the purpose of evenly distributing the workload and receipt of cardholder payments.
Cycle Period
A specific period during which both debit and credit transactions are accumulated from billing.
Daily Periodic Rate
The annual percentage rate (APR) expressed on a daily basis. It equals 1/365th of the APR and is typically used to calculate a loan payout.
Data
Representation of facts; concepts; or instructions in a formalized manner suitable for communication; interpretation; or processing by humans or by automatic means. Any representations such as characters or analog quantities to which meaning is or might be assigned. (Source: Federal Standard 1037C; Telecommunications: Glossary of Telecommunication Terms)
Data Authentication
A process used to verify data integrity e.g.; verification that data received are identical to data sent; or verification that a program is not infected by a virus. (Source: Federal Standard 1037C; Telecommunications: Glossary of Telecommunication Terms)
Database
A computer file used to store large quantities of information; such as customer names and addresses.
Data Capture
The collection; formatting; and storage of information in computer memory. Some point-of sale terminals perform data capture functions. See EDC Terminal
Data Capture-Only Capability
Point-of-transaction capability in which the transaction receipt data are electronically captured for deposit purposes but does not have the capability to go online for authorizations.
Data Dictionary
A manual that outlines the content and definition of data elements used in building a particular transaction set.
Data Element
The basic unit of information in EDI transaction sets; containing a set of values that represent a piece of information.
Data Encryption Key (DEK)
Used for the encryption of message text and for the computation of message integrity checks (signatures).
Data Encryption Standard (DES)
A cryptographic algorithm for the protection of unclassified computer data and published by the National Institute of Standards and Technology in Federal Information Processing Standard Publication 46-1. In the Bank card industry the primary method for encrypting and decrypting a Personal Identification Number and securing that these PIN numbers never appear in the clear when transporting from a terminal. All messages are encrypted and decrypted using this format. In the bank card industry; the approved algorithm used by electronic hardware devices for the cryptographic protection of computer data.
Data Integrity
- The condition existing when data are unchanged from their source and have not been accidentally or maliciously modified; altered; or destroyed. 2. The condition in which data are identically maintained during any operation; such as transfer; storage; and retrieval. 3. The preservation of data for their intended use. 4. Relative to specified operations; the a priori expectation of data quality. (Source: Federal Standard 1037C; Telecommunications: Glossary of Telecommunication Terms)
Data Management
The control of data-handling operations; such as acquisition; analysis; translation; coding; storage; retrieval; and distribution of data; but not necessarily the generation and use of data.
Data Mining
The process of analyzing data to determine data relationships undiscovered by previous analyses.
Data Storage Entities (DSE)
The term used by MasterCard to describe all entities that store MasterCard account data on behalf of merchants; such as Web hosting providers and payment gateways.
Data Transmission
The electronic exchange of information between two data processing points.
Data Transport Network
In MasterCard; the part of the BankNet system through which information is exchanged between members and the central processing site in St. Louis; Missouri.
Daylight Overdraft
A negative funds position in an account that occurs after opening of business and is cleared before close of business on the same day.
Days Outstanding (DSO)
The number of days between the time a transaction occurs and the time that funds are collected. (Source: American Express)
DBA (Doing Business As)
A formal name under which an individual; company; or organization conducts business. (Source: American Express)
Death Notification Entry
An automated notice of death sent by a federal agency to a financial institution to notify the financial institution that a recipient of payments from that agency has passed away.
Debit
An entry to the record of an account to represent the transfer or removal of funds from the account.
Debit Block
The process used to restrict debits to a demand deposit account; generally limited to business accounts.
Debit Cap
The limit on the dollar amount of debit transactions for an account or entity.
Debit Card
A plastic card linked to a checking or savings account. Offline or signature-based debit cards work in the merchant environment the same as a credit card transaction and are not required to be “online” to the account balance. Offline signature-based functionally work like credit cards; an initial transaction is used to hold funds and a second to settle or remove the funds from the card balance. Online debit cards or PIN-based debit cards ride over the ATM network; they require a PIN and the ability to authorize against the actual balance of the card in a single step transaction. Prepaid cards fall into the debit category.
Debit Identifier
The word DEBIT displayed on the front of all consumer debit and prepaid cards.
Decipher
To decrypt or unencode information.
Decision Maker
The business owner or manager who is authorized to make decisions for the business. (Source: American Express)
Decline
The denial of a transaction either online or during stand-in or a telephone authorization.
Declined Response
An authorization response indicating that the transaction is declined and the card is not to be honored.
Decryption
The mathematical process of unencoding encrypted information so the original message or information can be used.
Dedicated Circuit
A circuit designated for exclusive use by specified users. Usually operated between two users only. See Leased Line.
Default
Failure; inability or unwillingness to pay a debt; or bankruptcy.
Deferred Clearing Transaction
A transaction that is cleared and settled without authorization or a transaction that is authorized with one system and cleared though another.
Deferred Payment Transaction
A transaction completed in a card-absent environment for which the cardholder is billed once; no more than 90 days after the first shipment of merchandise.
Delayed Delivery Transaction
A single transaction in which a cardholder completes two separate transaction receipts. The first transaction receipt functions as the deposit for goods or services (such as a down payment); the second is to pay the balance due the merchant.
Delimiter
A predetermined code that indicates the beginning and end of a data segment.
Delinquency
Late payment of a bill or debt.
Delinquent Account
The account status occurring when the cardholder does not meet the payment conditions of the cardholder agreement; i.e.; one or more payments are past due.
Demand Deposit Account (DDA)
The merchant bank account that the acquirer/processor credits or debits for deposits; fees; and adjustments. Also used by consumers for funds access. Funds can be accessed by check; debit card; or the Automated Clearing House (ACH). Also called a checking account.
Demand Draft
A single payment check without a scannable remittance document attached. This draft may be drawn on the customer’s account or the consumer payment provider’s (CPP) account. Generally; it is created by the payee with authorization from the payor and may not have a signature. (Source: Billing.org)
Demographics
The specific geographic attributes of a business; market segment; or product usage area.
Department of Justice (DOJ)
The U.S. Cabinet department created in 1870 to enforce the law and defend the interests of the United States according to the law and to ensure fair and impartial administration of justice for all Americans. The DOJ is administered by the Attorney General. Some of its many divisions include Antitrust; U.S. Attorneys; and the Federal Bureau of Investigation. The DOJ investigates unfair practices by businesses as reported by other contracted businesses or by consumers.
Deposit:
The submission of a transaction receipt by a merchant to an acquirer; resulting in a credit or debit to the merchant’s Visa account.
Deposit Account
An account used by a customer to make deposits and withdrawals at a financial institution. Deposit accounts include checking; savings; and NOW (negotiable order of withdrawal) accounts.
Deposit Date
The date on which an acquirer receives the transmission receipt from the merchant. Also; the date when the merchant receives his funds.
Depository Financial Institution (DFI)
A financial institution able to receive deposits from another financial institution by completing and depositing checks.
Derived Unique Key Per Transaction (DUKPT)
In cryptography; a key-management technique that uses a unique key for each separate transaction to prevent the disclosure of any past key used by the transaction-originating tamper-resistant security mode (TRSM). The unique transaction keys are derived from a base derivation key using only nonsecret data transmitted as part of each transaction.
DES Algorithm
The Data Encryption Standard algorithm that is a publicly available mathematical calculation used in conjunction with confidential encryption keys to scramble data securely.
Descriptive Statement
A financial institution account summary or a bank card account summary that contains descriptive information about one or more entries for which a separate item may or not be enclosed.
Dial-up Terminal
An authorization terminal that; like a telephone; dials the authorization center for validation of transactions.
Digital
Systems whose information is represented in binary form.
Digital Cash
Two main mechanisms that download “digital coins” to a personal computer from a participating bank that set up a digital money account with a bank. Both encrypted forms of cash can be sent to merchants for payments.
Digital Dozen
The 12 requirements of the Visa Cardholder Information Security Program (CISP)
Digital Money
The same as digital cash; but can also involve the use of software-based secure credit card transactions
Digital Signature
An electronic means of authentication that uniquely identifies the sender of a message or payment through special encryption techniques.
Digital Signature Algorithm (DSA)
The algorithm used to generate a digital signature.
Digital Subscriber Line (DSL)
In integrated services digital networks (ISDN); equipment that provides full-duplex service on a single twisted metallic pair at a rate sufficient to support ISDN basic access and additional framing; timing recovery; and operational functions. The physical termination of the DSL at the network end is the line termination; the physical termination at the customer end is the network termination.
Digital Wallet
The software that provides the equivalent of a wallet for electronic commerce. Also called an e-wallet; it holds digital money that is purchased similar to travelers’ checks. A wallet may also hold credit card information or checking account information along with the associated digital certificate that authenticates the cardholder.
Diners Club Card/Carte Blanche
: An independent card wholly owned by CitiGroup primarily known as a T&E card. In 1950; the Diners Club Card was the first charge card in the U.S. issued as a cardboard card to Frank McNamara (founder of the company) to be used in restaurants. The Diners Club program also issued the first corporate card in the U.S. in 1975. Diners Club International was acquired by Citicorp in 1981 but many franchises are still independently owned. It also boasts the issuance of the first rewards program in 1984. In the US; Diners Club/Carte Blanche cards are acquired through the same methods as MasterCard’s. The messages and rules are very similar to MasterCard. All card numbers begin with a “36”. However in the US; they have a MasterCard number starting with a “5.”
Direct Billing Costs
These costs include the costs of invoicing (statement creation and issuance); collecting funds (e.g.; through a lock box); reconciling balances and handling basic disputes and non collections. (Source: American Express)
Direct-Connect Merchant
A merchant that directly enters authorization requests into Visa’s V.I.P. system and MasterCard’s BankNet network.
Direct Deposit
A payment method used in the ACH system in which funds are automatically transferred from the account that owes the funds to the account of the payee.
Direct Federal Program
Any federal benefit program that is prefunded into the cardholder’s cash account.
Direct Marketing
A transaction category for customized services and procedures for merchants that offer merchandise or services via catalogues; telephone; mailings; and/or advertisements.
Direct Mail
A lead generation technique used by issuers; acquirers; and direct sales agents in which pre-approved mailers; postcards; or letters are sent to new businesses or consumers.
Direct Payment
A method of collection used in the ACH Network for certain claims; generally those that are repeated over a period of time; under which the debtor gives the originator a standing authorization to debit his or her account.
Disclosure
The information required by federal or state law (see Regulation Z) to be relayed to the cardholder concerning terms of the credit agreement or fees and conditions associated with any kind of payment card. Disclosure must be made by the issuer before the first use of the card by the cardholder and must be included on all monthly statements and other documentation mentioning finance charges and/or fees. The same principle applies to contracts with a merchant. All fees and charges must be fully disclosed before charges are made and agreed upon by both parties contractually. Some items to be disclosed include: interest rates (annual and periodic); amount; types; and timeline of fees; method of calculating finance charges; credit line; and any terms affecting billing.
Discount Rate Revenue
The amount of revenue that American Express generates from the discount rate charged a merchant. (Source: American Express)
Discover
Morgan Stanley spun off Discover Financial Services in 2007. Discover Financial Services (NYSE: DFS) is comprised of Discover Network (network; credit and signature debit card issuing; acquiring; merchant services and prepaid issuing); Pulse; Goldfish (UK subsidiary); Discover Bank and Discover Card.
Discover Card
The Discover Card began as a reward-based card issued by Sears in the mid-1980s. Discover/Sears issued all of the cards and had a reseller program for the sales to merchants. Since then Discover has grown to over 5 million merchants accepting the card. In 2007; Discover went to an indirect acquiring model by allowing acquiring processors to acquire and sell Discover as part of the MasterCard/Visa package. All Discover Cards begin with a “6.”
Discover Network
Network; credit and signature debit card issuing; acquiring; prepaid card issuing and merchant services arm of Discover Financial Services.
Disparity
The term used for a form of suppression when a merchant allows placement of competitor POP (point-of-purchase) but not American Express POP. (Source: American Express)
Dispute
The cardholder or merchant disagreement about a particular charge or bill.
Dispute Management
EIPP (electronic invoice presentment and payment) functions that allow buyers to notify the seller of problems or adjustments to an invoice.
Diversity
All human and organizational differences.
Document Express
The American Express system that stores all card acceptance agreements (SE contracts). (Source: American Express)
Domain
- The independent variable used to express a function. Examples of domains are time; frequency; and space. 2. In distributed networks; all the hardware and software under the control of a specified set of one or more host processors. A unique context (e.g.; access control parameters) in which a program is operating; in effect; the set of objects a subject has the privilege to access. (Source: Federal Standard 1037C; Telecommunications: Glossary of Telecommunication Terms)
Domain Name
The conventional Internet name for a network or computer system; which consists of a sequence of two or more groups of characters separated by periods; e.g.; the ∫govinst.com∫ groups of characters in the host name ∫www.govinst.com;∫ where the ∫.com∫ is the first-level domain name (or top-level domain name); and the ∫govinst∫ characters represent the second level. In the United States; nonprofit organizations are identified (with exceptions) by the suffix ∫.org;∫ government entities by ∫.gov;∫ educational institutions by ∫.edu;∫ commercial organizations by ∫.com;∫ and military bodies by ∫.mil.∫ Outside of the United States; domain names contain an ISO-standard country code suffix to indicate the computer or network’s country of origin. (Source: Federal Standard 1037C; Telecommunications: Telecommunications: Glossary of Telecommunication Terms)
Domain Name System (DNS)
A general-purpose data query service for looking up host addresses based on host names. Important domains are .com (commercial); .edu (educational); .net (network); .gov (government); .mil (U.S. military); and .org (nonprofit organization).
Domestic Interchange
Interchange of a transaction within the country of issuance and acquisition.
Domestic Transaction
A transaction in which the issuer and the acquirer of the card used are located in the same transaction country.
Do Not Call Registry
A provision of the federal Telemarketing Sales Rule announced in June 2003 that created a national registry to make it easier and more efficient for U.S. consumers to stop receiving telemarketing calls.
Door Reader
The device on a door that communicates with an ID card or credential and sends data from the card to the control panel for decision on access rights. An example is a card used in a university environment. (Source: Smart Card Alliance)
Door Strike
The electronic lock on each door that is connected to the control panel. (Source: Smart Card Alliance)
Downline Load (DLL)
The process of downloading a software application onto a terminal.
Download
To transfer a copy of a file residing on a remote computer to a userπs computer. In the world of electronic processing; this term refers to the passing of programming information and parameters from a terminal driving processor to an electronic data capture terminal. This transfer is typically accomplished by phone from a computer program or by directly connecting a terminal to a computer or to another already programmed terminal.
Downgrade
The interchange downgrades that occur when a transaction does not meet all of the criteria set forth by the card companies to qualify for the best possible interchange rate. Visa and MasterCard examine each transaction as submitted and qualify or downgrade it based on the set of criteria established and presented.
Down Time
A period when all or part of a system or network is not available to end users due to failure or maintenance.
Draft Storage
The storage of sales drafts after processing for possible future reference or retrieval. The drafts can be stored at the processor; the acquirer; or the merchant.
Dual Dating
The practice of embossing cards with valid from and expiration dates as a fraud-deterrent measure.
Dual Interface Card
An ID card that has a single smart card chip with two interfaces; contact and contactless;using shared memory and chip resources. (Source: Smart Card Alliance)
Due Date
The day a payment is due to the creditor.
Dues and Assessments
To be an acquiring or issuing member of Visa and/or MasterCard the financial institution must pay annual membership dues and quarterly assessments. The dues are based on the asset size of the financial institution. The assessments are based on the dollar size of the issuing portfolio or the dollar amount of merchant sales transactions. Dues and assessments fund MasterCard and Visa services and operations; including licensing; patents and copyrights; operating regulations; national and international settlement and authorization systems; the interchange network; product development; advertising and promotion; and risk management services. Discover and American Express have similar assessments.
Dun & Bradstreet (D&B)
A United States-based for-profit agency that furnishes subscribers with marketing statistics and the financial standings and credit ratings of businesses. It is used in risk management.
DUNS
The number issued by Dun & Bradstreet to identify various companies; originally for credit reporting and information purposes.
Dynamic Currency Conversion (DCC)
The consumer’s ability to transact the price of a transaction in local currency in real time at the point of sale. This expedites the transaction for the consumer; who then does not have to wait for receipt of the credit card statement before the conversion amounts are known. It is a value-added activity for both merchant and consumer. Some T&E merchants offer to convert the transaction into the cardholder’s home currency. This means the merchant‚Äîand not the card company‚Äîis converting the currency. If the merchant supports DCC; the card companies require that the consumer is provided a meaningful choice at the point of sale and have the right to buy the purchase in the local currency or home currency. The card companies also require merchants offering this service to inform the consumer of the exchange rate including any applicable commission being charged.
EBCDIC
Acronym for the standard IBM mainframe computer character set.
EBITDA
An accounting term referring to “earnings before interest; taxes; depreciation; and amortization” but after all product/service; sales; and overhead costs are accounted for. Sometimes referred to as operational cash flow; EBITDA is a measure of a company’s cash flow that can be compared to the enterprise value (the total value of a firm’s assets calculated by adding debt to market capitalization and subtracting cash). Some analysts consider the ratio of enterprise value to EBITDA as more useful than the price-to-earnings ratio.
EBPP (Electronic Bill Presentment & Payment)
The process of paying a bill online; e.g. with electronic banking products.
EBT (Electronic Benefits Transfer)
The delivery of annuity and public assistance benefits via the application of plastic card technology.
E-Cash
Abbreviation for electronic cash; or data representing money. The data can be transferred by computer network and traded as token exchangeable for real money. Also called digicash; digital cash.
ECA (Electronic Check Acceptance)
The process of electronically submitting and processing a paper check.
ECC (Elliptic Curve Cryptography)
A type of security encryption used in the development of smart cards. (Source: Smart Card Alliance)
E-Check
The electronic equivalent of a paper check.
ECM (Excessive Chargeback Merchant) Merchant
is defined as any distinct merchant location; whether a merchant’s physical location or a merchant’s Internet site or uniform resource locator (URL) that is uniquely identified by the acquirer in the transaction record. If a merchant location has a CTR (chargeback-to-transaction ratio) in excess of 50 basis points and at least 50 chargebacks in a calendar month; then MasterCard considers the merchant a Chargeback-Monitored Merchant (CMM). If a merchant location has a CTR (chargeback-to-transaction ratio) of at least 100 basis points and a minimum of 50 chargebacks in each of two consecutive calendar months (the “trigger months”); then MasterCard considers the merchant an Excessive Chargeback Merchant (ECM).
E-Commerce
Abbreviation for electronic commerce. A way of doing real-time business transactions via telecommunications networks when the customer and the merchant are in different geographical places. Electronic commerce is a broad concept that includes virtual browsing of goods for sale; selection of goods to buy; and payment methods. Electronic commerce functions on a bona fide basis; without prior arrangements between customers and merchants. It operates via the Internet using any combination of technologies designed to exchange data (such as EDI or e-mail); access data (such as shared databases or electronic bulletin boards); and capture data (through bar coding and magnetic or optical character readers). (Source: Federal Standard 1037C; Telecommunications: Telecommunications: Glossary of Telecommunication Terms)
Economies of Scale
Term that describes volume as leverage for pricing; cost efficiencies; and outsourcing decisions. More volume lends to a lower per item charge.
ECP (Electronic Check Presentment)
The electronic transmission of the contents of the MICR (magnetic information character recognition) line of each check; with the physical items to follow.
ECR (Electronic Cash Register)
A cash register connected to a computer or other data processing device; allowing the use of such functions as sales; reporting; check and credit authorization inquiries; and direct transfer of funds from customer bank accounts to merchant accounts.
EDC (Electronic Data Capture)
The electronic collection; formatting; and storage of data such as customer name; account number; and amount of purchase.
EDI (Electronic Data Interchange)
A computer-to-computer exchange of standard business data according to agreed-upon data formats. Also; an abbreviation for electronic document interchange; a computerized system that allows linked computers to conduct business transactions; such as invoicing and ordering; over a telecommunications network.
EDIFACT
A set of standards approved by the United Nations for international electronic data interchange.
Edit Package
The clearing and settlement audit software that both Visa and MasterCard deliver to processors to validate interchange qualification; process interchange data; and process incoming transactions.
Effective Date
The date on which a card is activated or new terms or programs take effect.
Effective Entry Date
The date on which the originator requests that ACH transactions be posted to the originator’s and receiver’s accounts.
E-Fraud
Fraudulent activity conducted via the Internet. Types of e-fraud include unauthorized credit card use; some online auction dealings; and false investment. See Web Theft.
EFT (Electronic Funds Transfer)
The order; instruction; or authorization of any transfer of funds initiated through an electronic terminal; telephone; computer; or any other electronic means.
E-Invoice
The process of electronic invoice payment and presentment.
Eighty-Twenty (80:20) Rule
The observation that 80 percent of sales come from 20 percent of customers. Sometimes called the Parento Principle after the 19th-century economist who showed that income is unevenly distributed in society.
EIPP (Electronic Invoice Presentment and Payment)
In the B2B arena; the presentment of an invoice from a seller to a buyer and the corresponding payment from a buyer to a seller.
Electron Card
A card that bears the electron symbol and is issued as an electronic PIN-based debit card mark in the international Visa markets.
Electronic
Relating to technology having electrical; digital; magnetic; wireless; optical; electromagnetic; or similar capabilities.
Electronic Banking
A form of banking in which funds are transferred through an exchange of electronic signals between financial institutions rather than an exchange of cash; checks; or other negotiable instruments.
Electronic Bill Delivery
A bill delivery system that allows banks to send consumers their bills via their personal computers or telephone lines. This system allows consumers to transfer funds from their bank to the billing agent.
Electronic Bill Payment (E-Pay)
An alternative to paper checks for paying bills. Consumers can use PCs; telephones; screen phones; or ATMs to send electronic instructions to their banks or bill payment providers to withdraw funds from their accounts and pay merchants. Payments may be made either electronically or by a paper check issued by the bill payment provider.
Electronic Bill Presentment and Payment (EBPP)
The electronic presentation of statements; bills; invoices; and related information sent by a company to its customers and the corresponding payment for goods and services.
Electronic Billing Invoice Delivery Service (EBIDS)
A pilot using the ACH Network as a bill information delivery and payment remittance option for business-to-consumer payments.
Electronic Check
A payment transaction that originated as a paper check but was converted to an ACH transaction at the point of purchase.
Electronic Check Clearing House Organization (ECCHO)
A national clearinghouse for electronic check presentment.
Electronic Check Imaging
The process by which the merchant or financial institution can scan; capture; and store a duplicate image of a check. The check then can be cleared using the ACH format and process.
Electronic Check Council (ECC)
A council formed by NACHA to govern; oversee; and monitor the pilot programs for electronic check conversion.
Electronic Commerce Indicator (ECI)
An indicator required by Visa in the clearing record of all Internet transactions.
Electronic Commerce Merchant
A merchant that conducts the sale of goods or services electronically over the Internet and other networks.
Electronic Commerce Transaction
A transaction conducted over the Internet or other network using a cardholder access device. An electronic commerce transaction is one of the following: nonsecure transaction; nonauthenticated security transaction; or secure transaction.
Electronic Data
Data describing a transaction receipt.
Electronic Data Interchange (EDI)
The computer-to-computer exchange and use of information in a standardized message format.
Electronic Draft Capture (EDC) Terminal
A point-of-sale device that reads information encoded in the bank card’s magnetic stripe; performs authorization functions; stores transaction data; and batches and transmits that data to the acquirer or the acquirer’s processing agent for processing. Also called electronic data capture terminal.
Electronic Financial Services (EFS)
Financial services provided via electronic delivery channels (e.g.; personal computers; telephones; screen phones; and ATMs). These services may be transaction- and/or information oriented and may be provided by bank and nonbank providers.
Electronic Federal Tax Payment System (EFTPS)
The service formed to expedite and automate tax payments using the ACH Network.
Electronic Funds Transfer Act
Title IX of the Consumer Credit Protection Act establishing the basic rights; liabilities; and responsibilities of consumers using electronic money transfer services and of financial institutions offering those services.
Electronic Funds Transfer at the Point of Sale (EFTPOS)
A system that allows the automatic transfer of money from a buyer to a seller of goods or services at the time of sale. This system is more common in the United Kingdom.
Electronic Funds Transfer Association (EFTA)
A nonprofit association whose members make up the financial institutions and processors that effectuate electronic transfer of funds.
Electronic Funds Transfer System (EFTS)
An electronically based system that eliminates the need for paper (such as checks) in the movement of funds; e.g.; an ATM withdrawal or a pay-by-phone transaction.
Electronic Payment Gateway
Software and hardware interfacing merchants and credit/debit card authorization networks.
Electronic Point of Sale
A point-of-sale merchant with electronic equipment for pricing and recording transactions; but not necessarily incorporating functions for electronic funds transfer.
Electronic Purse (ePurse)
A payment card application that replaces cash. The ePurse holds monetary value; either on the card or in a central account on a host system that communicates with the payment card. See also Stored Value Card.
Electronic Services Payables
A system used by American Express to handle payments and reports for service establishments. (Source: American Express)
Electronic Signature
An electronic sound; symbol; or process attached to an agreement; authorization; or written statement executed with the intent to sign the record See also Digital Signature.
Electronic Terminal
A machine that is connected to card companies and allows for quick card transactions. (Source: American Express)
Electronic Transactions Association (ETA)
Founded in 1990; under the name Bankcard Services Association (BSA); the renamed ETA is a not-for-profit organization representing entities that provide transaction services between merchants and settlement banks and others involved in the electronic transactions industry.
Electronic Transaction Receipt
A receipt for which the terminal generates the required data.
Electronic Wallet (E-Wallet)
Software residing as a plug-in in the Web browser that enables a cardholder to conduct online transactions; manage payment receipts; and store digital certificates. Like a physical wallet; the digital wallet stores credit card information; payment information; and shipping details. The wallet typically initiates the data encryption in an SET transaction.
Element
The smallest item of information in a transaction set.
Abbreviation for electronic mail. An electronic means of communication in which (a) text is transmitted (and sometimes also graphics and/or audio information); (b) operations include sending; storing; processing; and receiving information; (c) users are allowed to communicate under specified conditions; and (d) messages are held in storage until called for by the addressee. Some email software permits the attachment of separate electronic files; e.g.; word processing; graphics; and audio files. (Source: Federal Standard 1037C; Telecommunications: Telecommunications: Glossary of Telecommunication Terms)
Embossing
The process of placing raised data; such as account numbers; cardholder names; and expiration dates; on an access card for automatic or manual reading.
Emergency Card Replacement Service
A MasterCard service that replaces cardholders’ lost and stolen cards.
Emergency Cash Service
A MasterCard service that provides cardholders with cash advances in emergency situations.
Employer Identification Number (EIN)
An identification number that the Internal Revenue Service assigns to employers that serves as the tax identification number.
EMS Order System
An American Express database that is used to order electronic merchant services products; e.g.; terminals and payment links. (Source American Express)
EMV
The international smart card standards group made up of Europay International; MasterCard International; and Visa International.
EMV Compliant
A card or terminal application that complies with the requirements of the EMV Integrated Circuit Card Specifications for Payment Systems.
EMV Integrated Circuit Card Specifications for Payment Services
Technical specifications developed jointly by Europay International; MasterCard International; and Visa International to provide standards and ensure global interoperability for use of chip technology in the payment industry.
Encode
To convert data using a code; frequently one consisting of binary numbers; in such a manner that reconversion to the original form is possible. To convert plain text to cipher text by means of a code. To append redundant check symbols to a message for the purpose of generating an error detection and correction code. (Source: Federal Standard 1037C; Telecommunications: Telecommunications: Glossary of Telecommunication Terms)
Encoding
The process of recording magnetized data on an access card’s magnetic stripe. The available ABA tracks on which to encode data are Track 1 (read only-alphanumeric; includes card number information; expiration date; and name); Track 2 (read only-numeric; includes card number; expiration date; security information such as PIN offset; and service codes for usage parameters); and Track 3 (numeric read and write capability; used in early offline ATMs and no longer widely used; has limited ability to store balances and velocity in simple arithmetic formats).
Encrypt
A generic term encompassing encipher and encode. To convert plain text into unintelligible forms by means of a cryptosystem. (Source: Federal Standard 1037C; Telecommunications: Glossary of Telecommunication Terms)
Encrypting Pin Pad (EPP)
A PIN pad that performs message encryption and decryption; usually DES or 3DES. See also Data Encryption Standard.
Encryption
A data security technique in which machine-readable data are scrambled and must be decoded before they can be processed.
Encryption Algorithm
In cryptography; a set of mathematically expressed rules for rendering data eligible by executing a series of conversions controlled by a key. (Source: Federal Standard 1037C; Telecommunications: Glossary of Telecommunication Terms)
Encryption Key
A string of characters or numbers; private to the parties using a particular encryption process that allows the originator of a message to encrypt the message and the receiver to decrypt it.
Encryption Support Service Provider (ESSP)
Services obtained from an organization; not an acquirer; whose benefit security-related business relationship with an acquirer includes: loading software into a terminal that will accept benefit security cards; loading or injecting encryption keys into terminals or PIN pads; or merchant help desk support that includes reprogramming of terminal software.
Enhanced Authorization Service
A VisaNet service providing issuers with all of the following: automated management of authorization request volumes; automated exception file updates; and enhanced reporting of authorization activity.
Enhanced Data
Also called Level 2 and Level 3 data. Data provided through the card companies to the issuer in connection with a commercial; purchasing; fleet or business card program. Such data may include both or either merchant level or transaction-level data.
Enhanced Merchant-Level Data
Merchant-related data provided through a card company to an issuer in connection with a commercial; purchasing; fleet or business card program. Such data may include: merchant street address; telephone number; incorporation status; owner’s name; minority- and woman owned business status; and taxpayer identification number.
Enhanced Transaction-Level Data
Transaction-related data provided through a card company to an issuer in connection with a commercial; purchasing; fleet or business card program. Such data may include: accounting code; sales tax; description of items purchased; cost per unit; number of units; vehicle fleet data (vehicle/driver ID; odometer reading); and detailed itinerary information (airline; origination/destination; class of travel).
Enhanced Visa Wordmark
A Visa-owned mark representing the Visa corporate identity; consisting of the Visa logotype centered above the comet design. Visa updated their wordmark and logo in March 2005. The πVπ in Visa was enhanced with a gold color to highlight the Visa wordmark’s unique serif. The word πVisaπ is much more prominent. The banners used as borders in the current design were eliminated.
Enhancement Services
Value-added services (such as an extended purchase warranty) that increase the bank card program’s appeal to the cardholder.
Enrollment
The process by which a customer establishes a relationship with a provider of bill; gift card; biometrics programs; or any program in which the consumer must initiate the exchange of payment and personal information in order to participate.
Enterprise Resource Program (ERP)
Integrated; corporate-wide applications such as accounts receivable; accounts payable; purchasing; customer relationship management; and treasury.
Entitlement
The government program benefits given to qualified members of a specific group.
Entitlement Date
The day that benefits are issued to recipients.
Entrepreneur
The person who assumes the financial risk of the initiation; operation; and management of a business or undertaking. He/she is primarily a financial and/or professional risk taker.
Entry
An electronic item representing the transfer of funds in the ACH Network.
Enveloping
A process by which documents of the same type or purpose are grouped together; bound; and sent to the same destination in an electronic envelope. Enveloping is accomplished with an electronic data interchange management software function.
EOM
Abbreviation for end-of-month.
e-P3
MasterCard purchasing card program that integrates payment processing with remittance processing.
Equal Credit Opportunity Act (ECOA)
The federal law enacted in 1974 that requires that all U.S. financial institutions make credit available equally to all creditworthy customers regardless of age; marital status; race; color; religion; or national origin. Also called Regulation B.
Equity
Value when business debts are subtracted from the business current market value. For example; if debts amount to $100;000; but the business could sell for $300;000; then the business has $200;000 in equity. The residual value of a business or property beyond any mortgage thereon and liability therein.
Equity Interests
A relationship structure among some ISOs/MSPs and their sponsors in which the ISO/MSP has negotiated an equity interest in the portfolio. Some of the terms include: right of first refusal to sell the portfolio; division of equity in monthly revenue and sales process; and some form of portfolio valuation.
Error Resolution Process
Procedures required under Regulation E for resolving a consumer’s allegation that entries were improperly charged to his/her account.
ESA (External Sales Agent)
The American Express program that allows an independent sales organization to sell the acceptance of American Express cards to merchants. American Express pays the agent an agreed-upon fixed fee for each approved application and allows the sales entity to retain amounts over the set discount rate as an inducement to sell and to reimburse the agent for the cost of sales.
Escheatment
The process of turning over unclaimed or abandoned funds or property to a state authority.
Escrow
A kind of holding pen for money that is released after a specific event has occurred. Some acquirers have ISOs or merchants put money into an escrow account; which is supervised by a neutral third party such as a financial institution. The financial institution (called the “escrow agent”) releases the money to the ISO or merchant only after the ISO or merchant has carried out certain agreed-upon tasks; such as completion of work or performance of a service.
ETA (2) (Electronic Transfer Accounts)
U.S. Treasury accounts to be used at participating financial institutions for the express purpose of electronic benefits transfer. These accounts have specific regulations and standards.
Ethernet
A standard protocol for using various transmission media; such as coaxial cables; unshielded twisted pairs; and optical fibers. (Source: Federal Standard 1037C; Telecommunications: Glossary of Telecommunication Terms)
Ethics Statement
A statement outlining a code of ethics and professional conduct. Sponsoring members sometimes require these statements for new sales professionals upon registration.
Exceptions
Transactions that are in some way abnormal. In the case of bank cards; exceptions can be questionable charges and chargebacks.
Exception Item
Any entry that requires special attention or processing; A list of lost; stolen; counterfeit; fraudulent; or otherwise invalid account numbers kept by individual merchants or their third-party processors. The exception file should be checked as part of the authorization process; particularly for transactions that are below a merchantπs floor limit. including retrieval requests and chargeback processing.
Exception Report
A summary detailing questionable charges and chargebacks.
Excessive Chargeback Activity
Chargeback activity that exceeds Visa/MasterCard-specified parameters. See also Chargeback Ratio.
Excessive Chargeback Program
Visa and MasterCard programs which monitor and alert acquirers when a merchant approaches or reaches high volumes of chargebacks. Warnings; alerts; and fines may be imposed if thresholds are exceeded.
Excessive Chargeback Program Reporting
Under the revised Excessive Chargeback Program (ECP) Standards; each calendar month an acquirer is responsible for calculating the chargeback-to-transaction ratio (CTR) in basis points for each of its merchants.
Excessive Fraud Activity
Fraud activity that exceeds Visa/MasterCard specified parameters. See also Fraud Ratio.
Exchanges
Forums or clearinghouses that enable buyers; sellers; and commodities to partner to provide economies of scale and reduced development expenses.
Exchange Rate
The charge for exchanging the currency of one country for the currency of another.
Excite Field
The RF (radio frequency) field or electromagnetic field that is transmitted constantly by the contactless door reader. When a contactless card is within range of the excite field; the internal antenna on the card converts the field energy into electricity that powers the chip. The chip then uses the antenna to transmit data to the reader. (Source: Smart Card Alliance)
Exclusivity
A contractual term whereby the primary party requires a sole relationship for the services being contracted.
Executive Business Card
Issued by MasterCard Issuers only in the United States. It includes a higher credit limit (currently $10;000 per account) to provide select small businesses with additional buying power.
Expiration Date
The date embossed on a bank card or imbedded in a chip card beyond which the card becomes invalid.
Exposure Limit
A maximum total limit established by an originating depository financial institution (ODFI) for each of its originators beyond which the ODFI is unwilling to process additional ACH files. This limit is established as a fraud and error control.
ExpressPay
The contactless American Express card for transit; tolls; and other proximity payments. (Source: American Express)
Expert System
An information-processing technology that stores a large amount of data on a specific area and then performs a series of logic on responses to simple questions with the aim of solving problems. Sometimes these systems are called knowledge based systems. They are popular in technical and customer support systems; where many people need quick training and an archive of solutions.
Extranet
An intranet that has been extended to include access to or from selected external organizations such as customers or suppliers; but not the general public. Connections may be via leased lines; dial-up connections; or network interconnections. The overall network may be; but is not necessarily; a virtual private network. This term also refers to a Web site that links businesses to consumers; suppliers; and other parties for electronic commerce. These sites usually provide more consumer-specific information than public sites and may have security devices such as passwords for a user to gain access to more sensitive information. See also Intranet. (Source: Federal Standard 1037C; Telecommunications: Glossary of Telecommunication Terms)
Eyeballs
The marketing measurement indicating the number of people who have looked at an ad or magazine to determine circulation. Also; a term that describes usage of a Web site for projection of possible shoppers.
Face-to-Face Environment
An environment in which a transaction is completed under all of the following conditions: card is present; cardholder is present; and an individual representing the merchant or acquirer completes the transaction. Transactions in this environment include: retail transactions and manual cash disbursements. Transactions in this environment exclude: installment billing transactions; mail/phone order transactions; recurring transactions; and cardholder-activated terminal transactions.
Facsimile (FAX)
A form of telegraphy for the transmission of fixed images; with or without halftones; with a view to their reproduction in a permanent form. The process by which fixed graphic images; such as printed text and pictures; are scanned and the information converted into electrical signals that may be transmitted over a telecommunications system and used to create a copy of the original; or an image so produced. Wire photo and telephoto are facsimile via wire circuits. Radio photo is facsimile via radio. Technology exists that permits the transmission and reception of facsimile data to or from a computer without requiring hard copy at either end. (Source: Federal Standard 1037C; Telecommunications: Glossary of Telecommunication Terms)
Facsimile (FAX) Access Service/System
A facsimile-based process that enables low-volume participants to transmit and fulfill copy requests through the VisaNet Copy Request and Fulfillment Service.
Facsimile Draft
A paper record that an acquirer may provide as a substitute for the sales draft. Also called a substitute document.
Factoring
Also called laundering. One merchant’s depositing drafts to its account that have originated from the sales of another merchant; generally one that cannot obtain a merchant account in its own name. Can also be the coercion or bribery of a legitimate merchant to process other merchants’ transactions that are typically fraudulent.
Fair & Accurate Credit Transaction Act
Enacted on December 4; 2003; this law gives regulators the green light to enact certain protections in regulating companies; such as financial institutions or payment processors that have access to an individual’s confidential financial information.
Fair Credit Reporting Act (FCRA)
Seeks to achieve fair; timely; and accurate reporting of credit information. Under this act; a consumer has the right to see the credit history maintained by a credit bureau. Signed into law on December 4; 2003; it includes amendments to help consumers protect themselves from identity theft.
Fair Isaac Corporation
A company that supplies creative analytics and predictive modeling solutions to the payment card processors.
Fair Market Value (FMV)
The worth of a product or company in a marketplace. In leasing terms; the fair market value is used at the end of the lease to calculate remaining debt on the lease.
Farm Bill
This federal legislation passed in 1990 required the U.S. Department of Agriculture to issue regulations to establish EBT as a food stamp delivery option.
FastTrack Exhibits
A series of specific questionnaire-style exhibits; available upon request; designed for each chargeback category to facilitate the exchange of information in the dispute resolution process. A FastTrack Exhibit is required when documentation is sent to the opposing member and may be used for nonfraud-related disputes when a cardholder or merchant letter is unavailable.
Fat Client
A client-centric computing model where software must be installed on each client in a network. This approach often requires that each client computer be upgraded to the same level. (Source: Federal Standard 1037C; Telecommunications: Glossary of Telecommunication Terms)
Fault Tolerance
The extent to which a functional unit continues to operate at a defined performance level even though one or more of its components are malfunctioning. (Source: Federal Standard 1037C; Telecommunications: Glossary of Telecommunication Terms)
FCC (Federal Communications Commission)
The U.S. government board of five presidential appointees that has the authority to regulate all nonfederal interstate telecommunications (including radio and television broadcasting) as well as all international communications that originate or terminate in the United States. Similar authority for regulation of federal telecommunications is vested in the National Telecommunications and Information Administration (NTIA). (Source: Federal Standard 1037C; Telecommunications: Glossary of Telecommunication Terms)
FDIC (Federal Deposit Insurance Corporation)
The federal regulatory agency that; among other things; insures funds on deposit at member banks.
Federal Information Processing Standard (FIPS)
The federal standard for processing information; including encryption and security features.
Federal Program Agency (FPA)
The federal agency that implements congressional legislation and effects policy decisions of the Executive Branch.
Federal Register
The federal publication in which all public-record government regulatory actions and procedures are published; including requests for comment and final regulations and actions. The date of publication in the Federal Register is often considered the effective date of many regulatory actions.
Federal Reserve Bank (FRB)
The branch or district office of the Federal Reserve System that acts as the central bank of the United States.
Federal Reserve System
A system of 12 regional banks that regulate bank holding companies and subsidiary commercial banks; provide payment services; and; through open-market operations; control the nation’s money supply.
Federal Trade Commission (FTC)
The federal agency responsible for enforcing the Truth in Lending Act (Regulation Z); of which the Consumer Leasing Act is a part; among leasing companies; finance companies; and lessors not regulated by other federal agencies. The Federal Trade Commission also performs other functions related to its role of ensuring that the nation’s markets function competitively; enforcing other statutes affecting consumer financial services; and enforcing the Federal Trade Commission Act; which prohibits unfair or deceptive acts or practices.
Fed Funds
Deposits made by a commercial bank in its local Federal Reserve Bank. These funds include cash balances in excess of the reserve requirement; which may be loaned to other banks overnight.
FedLine
A personal computer software program written by the Federal Reserve Bank that allows access to the FRB’s payment services. Many smaller financial institutions use Fedline to originate and receive ACH.
Fed Wire
A wire transfer service operated by the Federal Reserve Bank to move funds electronically with instantaneous settlement.
Fee Collection
A VisaNet transaction used by a member or Visa to collect financial obligations of a member from a clearing processor.
Feet on the Street
An expression meaning salesperson or merchant-level salesperson.
Fiber-Optic Cable
A transmission medium composed of small strands of glass providing a path for light rays that act as a carrier.
Fictitious Account Number
A cardholder account number that does not exist and has never existed (used for fraudulent purposes).
Field
One or more consecutive character positions within a file.
File Transfer
The copying of a file from one computer to another over a computer network.
File Transfer Protocol (FTP)
A method of transferring files from one computer to another over the Internet.
Finance Charge
The cost of consumer credit expressed as a dollar amount.
Finance Company
A business that makes consumer loans; usually to individuals who qualify for credit under the criteria of banks and credit unions.
Financial Agent
A financial institution designated by the U.S. Treasury Department to conduct depository services on behalf of the federal government.
Financial EDI
Electronic exchange of payments; payment information; or financially related documents in standard formats between business partners.
Financial Institution (FI)
Any bank; savings and loan; credit union; or other institution organized under either national or state banking laws capable of accepting deposits and/or extending credit.
Financial Intelligence Unit (FIU)
New organization unit for risk management and payment fraud investigation; such as with money laundering.
Financial Management Service (FMS)
A U.S. Treasury Department bureau that is the government’s financial manager and has responsibility for managing the government’s payments and collections; including Electronic Benefits Transfer.
Firewall
A computer that (a) acts as an interface between two networks (e.g.; the Internet and a private network) and (b) regulates traffic between those networks for the purpose of protecting the internal network from electronic attacks originating from the external network. The firewall is capable of handling the following tasks: (a) isolating internal and external traffic (a bridge service); (b) making internal addresses invisible and directly inaccessible from outside and passing through authorized traffic after proper checking (a proxy service); (c) facilitating protected (encrypted) connections to cooperative parties over public networks (a tunneling service); (d) filtering outgoing traffic for security and network usage rules (filtering or monitoring service); (e) filtering incoming traffic for rogue data (viruses; spam; inappropriate data (filtering); or improper actions (port scanning; overload prevention; etc.; (f) blocking forbidden external services or addresses (blocking; ∫network nanny∫-functions); (g) providing log-in services for authorized outside users and simulating the approved outside user as an inside user (proxy; log-in server); (h) caching network traffic (cache service); (i) converting between different network protocols on different protocol levels (bridge when handling lower level protocols; gateway when handling higher level protocols); (j) traffic diverting (e.g.; for cost optimizing; accounting; network planning; monitoring); (k) providing consistent; open entry to the internal network (portal service) and facilitating public network address and connection sharing (proxy service). 2. A system designed to defend against unauthorized access to or from a private network. Firewalls can be implemented in both hardware and software; or a combination of both. Also called front-end security filters; proxy. (Source: Federal Standard 103C: Telecommunications: Glossary of Telecommunication Terms)
First Alert
A legacy system designed to provide early warning reports to members by identifying transactions occurring on accounts listed on the authorization file for credit or fraud reasons. First Alert was replaced in 2005 by the Portfolio Analytics component of the Fraud Performance Analyzer Package.
First-In/First-Out (FIFO)
A queuing discipline in which entities in a queue leave the queue in the same order in which they arrive.
First-In/Last-Out (FILO)
A queuing discipline in which entities in a queue leave the queue in the reverse order from which they arrive.
Flat-Fee Option
A pricing program in which merchants pay $5 per month for American Express Card acceptance. To qualify; the merchant’s American Express charge volume must remain below $5;000 in any consecutive 12-month period. (Source: American Express)
Fleet Card
A corporate credit card used only for the purchase of fuel and vehicle maintenance services. See also Corporate Fleet Card.
Float
The time between a transaction and the actual settlement or posting of funds to cover it. Float is also the cost of not having money available to reinvest in a business. For example; not having access to your money means you may have to find other ways to obtain it; such as borrowing. In addition; the opportunity to invest those funds is lost when access to that money is not available. The longer one waits to receive the money; the more it could cost the business. (Source: American Express) For prepaid card issuers; float is the money held on deposit until spent by the cardholder. There is usually a delay between such time where interest is earned by the bank issuer.
Floor Limit
The maximum dollar amount for a single bank card transaction that may be conducted without authorization at specified merchant categories. Visa and MasterCard have eliminated most floor limits in the US.
Folio
A lodging merchantπs guest file that contains the cardholderπs transaction information; including check-in and check-out dates; rate; intended length of stay at check-in time; applicable charges; and taxes.
Food Stamp Coupon
A paper instrument that is printed in various dollar denominations and exchanged for food that meets Food Stamp Program specifications. The coupons are distributed by the states under the authority of the U.S. Food and Nutrition Service.
Food Stamps
A paper-based food assistance program of the U.S. Department of Agriculture to supplement low-income families. This program is a key automation element of the Welfare Reform Act of 1996 and is being implemented as an EBT program in various states.
Footprint
The amount of counter space a point-of-sale terminal takes up at a merchant store.
Force/Offline Transaction
The after+B1006the-fact entry of a purchase resulting from a referral message (“call Authorization Center”) or a downtime interruption of service from a network that enables the merchant to enter (as a force/post authorization) the transaction and the approval code into the EDC batch.
Formset
A carbon set of two or more copies used by the merchant as a sales draft when the merchant does not have a receipt printer.
Frame Relay
An interface protocol for statistically multiplexed packetswitched data communications in which variable-sized packets (frames) are used that completely enclose the user packets they transport. (Source: Federal Standard 1037C; Telecommunications: Glossary of Telecommunication Terms)
Franchise
An organization that grants a license to a group of merchants to market a companyπs goods or services in a particular territory.
Fraud
The deliberate act of misrepresentation of facts in order to obtain funds or goods illegally. Also; programs or schemes used to extort funds from consumers or banks.
Fraud Activity
A transaction or occurrence in which the cardholder certifies that he/she did not authorize or participate in the transaction or misrepresented his/her identity or financial status to the issuer to obtain any type of plastic card. Merchant fraud activity involves the submission of transactions by a merchant on known fraudulent cards or account numbers.
Fraud Detection
The process of identifying aberrant transaction characteristics.
Fraud Indicator
An alert system that would indicate; either objectively or subjectively; but within preset parameters that a merchant might have fraudulent intent or is prey to fraudulent schemes.
Fraud Prevention
The process of screening and implementing risk management procedures to mitigate fraud losses.
Fraud Monitoring
An operational process; usually done in the risk management area that involves setting alert parameters for review at the time that each transaction is presented to the system. Examples of these parameters include: excessive credits; excessive chargebacks; duplicate transaction amounts; and excessive sales amounts. Visa and MasterCard also monitor transactions and give warnings and alerts to acquirers that have suspicious transactions. Fines or monetary losses can occur if these procedures are not in place.
Fraud Ratio
The ratio of total fraudulent transactions to total sales transactions; expressed as a percentage.
Fraud Risk
The risk that a payment transaction will be initiated or altered in an attempt to misdirect or misappropriate funds.
Fraud-sales-ratio
The ratio of total fraudulent sales volume to total interchange sales volume; expressed as a percentage.
Fraudulent Merchants
Merchants who intentionally perpetrate fraud schemes; such as white plastic fraud or laundering; factoring; or third-party laundering. Chargebacks are a true indicator of fraudulent activity or services. Both MasterCard and Visa have chargeback monitoring programs aimed at decreasing chargeback activity.
Frequency Card
A form of loyalty card program that rewards the cardholder for dollars spent or number of times they shop. Programs differ in the manner of loyalty payments. Examples include points for dollars spent and cash or certificates given when spending thresholds are met. Some private-label department stores offer certificates for use in the store when certain dollar thresholds are met. Some airline and hotel programs offer points for time spent or miles traveled with the redemption of points to be used for future travel.
Frequently Asked Questions (FAQ)
A list of questions and answers provided by companies relating to software products or on a Web site. A FAQ sheet is usually prepared to assist in marketing and customer service of a product.
Front-End Processor
A company that provides communication and data processing services for authorization of card payments and transfer of data between merchant’s point-of-sale equipment to the back-end clearing and settlement processor. Other functions handled by the front-end processor include merchant terminal support and balancing as well as data capture for submission for clearing and settlement to a back-end processor.
FSA (Flexible Spending Account)
One of a number of tax-advantaged financial accounts that can be set up through a cafeteria plan of an employer in the United States. An FSA allows an employee to set aside a portion of his or her earnings to pay for qualified expenses as established in the cafeteria plan; most commonly for medical expenses but often for dependent care or other expenses; a prepaid card program.
FTP
Abbreviation for File Transfer Protocol. The transmission control protocol/Internet protocol (TCP/IP) that is a standard high-level protocol for transferring files from one computer to another. FTP usually is implemented as an application-level program and uses the Telnet and TCP protocols. In conjunction with the proper local software; FTP allows computers connected to the Internet to exchange files; regardless of the computer platform. (Source: Federal Standard 1037C; Telecommunications: Glossary of Telecommunication Terms)
Fulfillment
A document image that the acquirer supplies in response to a copy or retrieval request
Full Service Processing (FSP)
A relationship between an acquirer or an issuer and a full service processor is one in which the processor provides a total outsourcing service. The processor performs all system and back-office functions but does not assume the risk or liability for any credit or fraud losses. The processor is compensated usually by charging fees for the services rendered.
Funding
The payment to a merchant for his submitted deposits.
Funding Correction
A payment made by the acquirer to a merchant to rectify an error made in clearing a merchantπs bank card deposit or transmission through the card companies.
Funding Load
A transaction that results in the addition of funds to the prepaid account. Funding load sources can include cash; checks; debit cards; credit cards; ACH transfers; or other electronic funds transfers.
Funds Availability
The time at which the funds from an electronic funds transfer are made available to the customer or merchant.
Funds Disbursement
The transaction used to dispense funds to either the clearing processor or the merchant.
Funds Transfer System
A wire transfer network; ACH; or other communication system or clearinghouse or association of banks through which a payment order by a bank may be transmitted. The funds transfer system includes: SWIFT; CHIPS; Fedwire; and the National Association of Clearing House Associations; MasterCard and Visa.
Future Services
Any sale in which the complete product or service is not delivered at the time of the sale transaction. The term may apply to either face-to-face transactions or mail/phone orders.
Gateway
In a communications network; a network node equipped for interfacing with another network that uses different protocols. A protocol translation/mapping gateway interconnects networks with different network protocol technologies by performing the required protocol conversions. An interface that provides compatibility between networks by converting transmission speeds; protocols; codes; or security measures. (Source: Federal Standard 1037C; Telecommunications: Glossary of Telecommunication Terms)
Gateway Operator
In cross-border payments; the entity that receives and performs the currency conversion.
Gateway Services Switch
For Internet merchants; services that provide the connection to front-end processors; encryption and decryption of messages; connection to a third-party verification and authentication service such as Verified by Visa; and protocol and message conversion. These services also include connections to the back-end processor for submission of transactions to the card companies for clearing and settlement.
General Packet Radio Service (GPRS)
Wireless technology replacing CDPD for speed and accuracy.
General-Purpose Card
A charge or credit card that can be used to make purchases anywhere cards are generally accepted. Some of the most popular cards in the United States are: American Express; Diners Club; Discover; MasterCard; and Visa.
General Purpose Reloadable Prepaid Card (GPR)
A prepaid card that is loaded and reloaded with cash at the point-of-sale and is targeted to the “unbanked” population.
Generic Identifier Card
The Visa term for a card where a generic identifier is on the card instead of the cardholder’s name. Used in a temporary or instant issue card.
Gift Card
A prepaid card that is loaded with an amount usable for later purchases. There are three kinds of gift cards; open-loop which carries a card company logo and can be used anywhere the brand is accepted; closed-loop which is used exclusively at the store of which it is labeled; and private label which is used in a select group of merchants but utilizes the open-loop transaction method.
GLBA
Gramm-Leach-Bliley Act; which governs privacy. Also see Gramm- Leach-Bliley Act.
Global Area Network (GAN)
A network that (a) is composed of different interconnected computer networks and (b) covers an unlimited geographical area. Loosely synonymous with an internet; which designates one specific network (as opposed to the Internet).
Global Merchant Audit Program Report (GMAP)
Alerts acquirers to a potentially fraudulent merchant. This report does not specifically imply that a merchant is or will be responsible for fraudulent or counterfeit transactions.
Gold Card
A card program offering higher credit lines and expanded services. Qualifications for cardholder applicants are generally more stringent than for a standard or classic card.
Good Faith
An attempt by a member to resolve a dispute with another member in writing. A good-faith attempt at resolution must be made before filing a compliance case.
Goods and Services Dispute
Disputes resulting from the cardholder’s problem with the quality of goods or services; if the cardholder has tried in good faith to correct the problem and the purchase was made in the cardholder’s home state or within 100 miles of his/her current address and the purchase price was more than $50. (Source: American Express)
Government-Designated Issuer (GDI)
A financial institution designated by the U.S. Treasury to issue Benefit Security Cards to government benefit recipients on its behalf. The GDI; or its processor; maintains cash accounts and/or food stamp accounts on behalf of the cardholder and provides authorization services.
Government Smart Card Interoperability Specification (GSC-IS)
The GSC-IS was defined to provide the ability to develop secure identification smart cards that can operate across multiple government agencies or among federal; state; and local governments and provides solutions to a number of interoperability issues associated with contact smart card technology implementation. An upcoming GSC-IS revision will include interoperability definitions for contactless smart card technologies. (Source: Smart Card Alliance)
Grace Period
The period from the statement date of the last bill to the due date of the current bill; during which a recipient does not have to incur a late charge or interest charge; primarily for those without a revolving balance.
Gramm-Leach-Bliley Act
The Financial Modernization Act of 1999; also known as the ∫Gramm-Leach-Bliley Act∫ or GLB Act; includes provisions to protect consumers’ personal financial information held by financial institutions. There are three principal parts to the privacy requirements: the Financial Privacy Rule; Safeguards Rule and pretexting provisions.
Green Book
A U.S. Treasury publication that outlines the procedures for ACH transactions originated on behalf of the federal government.
Green Sheet
A biweekly publication and on-line portal for the financial services industry.
Greenwich Mean Time (GMT)
Solar time in Greenwich; England; which is at meridian 0. Also called Greenwich Time; it is used as the basis for standard time throughout the world; as well as the base time at which Visa and MasterCard perform their settlement processes.
Grievance
A disagreement filed by one EBT participant against another EBT participant that cannot be resolved by direct communication and must be resolved by the Benefit Security Program.
Gross Deposit
The process of submitting bank card sales and credits at the face amount. The acquirer later deducts the discount rate; also called a window discount. The acquirer takes the risk of prefunding but typically charges for the cost of funds.
Gross Margin
Sales minus cost of sales (cost of goods sold).
Gross Domestic Product (GDP)
The money value (at market prices) of the goods and services produced by the economy in a period of time; usually a year or a quarter. GDP is distinguished from the Gross National Product by the exclusion of income from abroad.
Gross Pay/Pay in Gross
A method of paying merchants that reflects total charge volume submitted without applying a discount rate. American Express merchants can request this option through American Express Customer Service. (Source: American Express)
GSA
General Services Administration; the federal agency responsible for government agency procurement.
GSA Large Transaction
A transaction completed with a purchasing card that is issued to the federal agencies by an issuer contracted with the General Services Administration.
GSA Large Transaction Interchange Reimbursement Fee
A fee paid to or received by a member for a GSA large transaction.
GSM (Global System for Mobile Communication)
International chipbased standard for digital or cellular use.
Guaranteed Funds
A Business to Business (B2B) term indicating that both buyer and seller know funds are available at the time of payment.
Guaranty
A promise by one party to honor the duties or pay the debts of another.
Guest Folio
The guest file of a lodging or cruise line merchant.
GUI
: Abbreviation for graphical user interface. A computer environment or program that displays; or facilitates the display of; on-screen options; usually in the form of icons (pictorial symbols) or menus (lists of alphanumeric characters) by means of which users may enter commands. Pronounced ∫gooey.∫ (Source: Federal Standard 1037C; Telecommunications: Glossary of Telecommunication Terms)
Hacker
- A person who breaks into; or attempts to break into; or use a computer network or system without authorization; often at random; for personal amusement or gratification; and not necessarily with malicious intent. 2. An unauthorized user who gains or attempts to gain access to an information system. 3. A technically sophisticated computer expert who intentionally gains unauthorized access to targeted protected resources. 4. Loosely; a computer enthusiast. 5. A person who uses a computer resource in a manner for which it is not intended or that is in conflict with the terms of an acceptable-use policy; but (unlike the work of a cracker) is not necessarily malicious in intent. (Source: Federal Standard 1037C; Telecommunications: Glossary of Telecommunication Terms)
Hard Copy
Data in paper form. In computer graphics and telecommunications; a permanent reproduction; on any media suitable for direct use by a person; of displayed or transmitted data. Examples of hard copy include teletypewriter pages; continuous printed tapes; facsimile pages; computer printouts; and radiophoto prints. Magnetic tapes; diskettes; and nonprinted punched paper tapes are not hard copy. (Source: Federal Standard 1037C; Telecommunications: Glossary of Telecommunication Terms)
Hardware
Physical equipment as opposed to programs; procedures; rules; and associated documentation. The generic term dealing with physical items as distinguished from its capability or function such as equipment; tools; implements; instruments; devices; sets; fittings; trimmings; assemblies; subassemblies; components; and parts. (Source: Federal Standard 1037C; Telecommunications: Glossary of Telecommunication Terms)
Hardware Security Module (HSM)
The smart card application used to manage the physical security of hardware.
Hash
A mathematical calculation that creates a single number from certain critical fields in each transaction entry as a check against inadvertent alteration of data contents due to hardware failure.
Hash Total
The result obtained by subjecting a set of data to an algorithm for purposes of checking the data at the time the algorithm is applied or for use at a later time; such as after transmission or retrieval from storage. A value computed on data to detect error or manipulation. (Source: Federal Standard 1037C; Telecommunications: Glossary of Telecommunication Terms)
Header
The portion of a message or batch of transactions that contains information used to guide the message to the correct destination. In the case of batch processing; the header is the summary record indicating the number of items and the total amounts. Used for reference and reconciliation.
Head-In System
The access control server; software; and database(s) used in a physical control system. (Source: Smart Card Alliance)
Headquarters/Head Office
The main operating office of a national retail chain through which all communication; supply orders; and funding are managed.
Health-Care Merchant
A merchant; other than a pharmacy; whose primary business is providing health care services.
Help Desk
A service provided to the merchant by an acquirer; sometimes outsourced to a third-party processor. The help desk responds to terminal problems; provides repair or replacement; and assists the merchant with questions about the point-of-sale equipment. This area also manages the initial downline loading of an application to the terminal.
Hexadecimal
The mathematical term that refers to a Base 16 numbering scheme.
Highly Suspect Merchant
A merchant location where an unusually high number of suspect transactions have occurred in proportion to the merchant’s total transaction volume.
High-Risk Chargeback Monitoring Program (HRCMP)
A Visa program that notifies merchant banks when a high-risk merchant has a chargeback-to-transaction rate of over one percent.
High-Risk Location
A merchant outlet with abnormally high levels of riskrelated activity.
High-Risk Merchant
A status identified as high profile for fraud and risk activities. Card companies categorize these merchants as being identified by their risk identification service when established parameters for risk and fraud activities have been exceeded. Merchant categories include: telemarketing; adult websites; travel; online pharmacy; gambling; bail bonds; lottery; pawn shops; dating/escort service; MLM and membership clubs.
Highway
A digital serial-coded bit stream with time slots allotted to each call on a sequential basis. A common path or a set of parallel paths over which signals from more than one channel pass with separation achieved by time division; for example; the Information Highway.
Hold-Back
An underwriting program in which a percentage of the merchant deposit is held back and set aside in a separate account to offset potential chargebacks or fraud. Also called a reserve.
Hologram
A laser-created photograph that creates a three-dimensional image; used as an anti-counterfeiting measure on bank cards.
Home Banking
Products offered by banks that are initiated by telephone or personal computer; such as bill paying; account inquiry; and funds transfer.
Home Page
- The document that is configured to be displayed first when a Web browser is opened. 2. The document designed to be the user’s point of entry into a Web site; or the page the user sees first when he/she visits a Web site. (Source: Federal Standard 1037C; Telecommunications: Glossary of Telecommunication Terms)
