Other Payment Systems Flashcards
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What are the five main participants in the Check system?
Payor, Paying Bank, Correspondent Bank, Bank of First Deposit, and Payee
What are the five main participants in the Card system?
Cardholder, Issuer, ATM/Payment Network, Acquirer, and Merchant
What is the year the American Bankers Association (ABA) adopted a routing number policy?
1911
What is the string of characters on the bottom of a check that includes the routing number and account number?
MICR (Magnetic ink character recognition) line
What is Check clearing?
The path a check follows
What is the process of debiting and crediting funds represented by a check?
Check collection
Fedwire® Funds Service uses what type of system to settle interbank funds transactions such as federal funds purchases, corporate payments, and other large-value payments?
Real-time gross settlement
What is a multi-party network with intermediaries connecting and managing the flow of funds between Cardholders and Merchants?
Open loop network
Payment services are provided directly to Merchants and Cardholders by the owner of the network without involving third-party financial institutions as intermediaries is called what?
Closed loop network
Online debit card transaction are also known as what?
PIN-based or single message transaction
Offline debit card transaction are also known as what?
Signature-based or dual message transaction
What is the instant payments platform operated by The Clearing House?
RTP®
What are the three RTP® status messages?
Accepted
Rejected
Accepted and not posted
What is the Federal Reserve’s payment service that allows transactions to be sent 24/7 called?
FedNow® Service or FedNow®
What are the types of FedNow® participation?
Customer Credit Transfer
Liquidity Management Transfer
Settlement Only
What is a transit check?
A check that must be sent to another depository institution for collection
What is settlement is done individually for each transfer, rather than processing by batch called?
Gross settlement
Which card transactions are eligible for fraud or unauthorized chargeback?
Signature-based card transactions
What type of check MUST be sent to another depository institution for collection?
Transit check
Which wire system participant receives the funds?
Beneficiary
What is a debit card payment requiring a PIN and traveling over one of the ATM/POS networks is also known as?
Online debit
What is debit card payment requiring a customer signature and traveling over a credit card network is also known as?
Offline debit
Which payments are final and irrevocable?
Wire, RTP®, and FedNow®
Which participant authorizes, clears, and settles a debit transaction between an Acquirer and Issuer?
An ATM/POS Network
List the three main type of cards and what they access.
- Credit cards access a lending product
- Debit cards access a DDA / checking account
- Prepaid/stored value cards access a stored balance that is not associated with the Cardholder’s account
