Term Definition
ABA Transit Routing Number, also Route Transit Number (RTN) The nine-digit bank code located at the bottom left side of a check or official financial draft that identifies the U.S. financial institution the instrument was drawn on. allows the funds to be withdrawn from the correct bank and account. allows checks to be sorted by financial institution.
Acquirer A financial institution that provides the following services to merchants: accepts cards as payment for goods and services. completes card payment transactions for the merchant. captures card information from the merchant.
Acquiring Processor An entity that delivers the following services to merchants: processes and clears transaction for merchants. provides billing, settlement, and reports.
Address Verification System (AVS) A proven fraud prevention model for card transactions that matches a physical shipping address with the cardholder’s billing address AVS is used by Card Associations (Visa, MasterCard, and American Express). Merchants pay an additional 1.25% fee on Visa and MasterCard sales that do not apply AVS.
Alternative payment methods Payments made with non-card payment instruments Examples include pre-paid bank accounts, wallets, vouchers, and transfers.
Application Program Interface (API) Electronic or digital communication of information between two separate computer applications or software that permits information to be transferred and exchanged between the two systems.
Authentication The process merchants and processors use to verify that the purchaser’s payment device, e.g. card or check, is being used by the authorized account holder. Authentication applies to in-person, phone, and online purchases. A cardholder may need to present additional information such as a digital password, the card security code, or a personal ID.
Authorization The process used to approve, reject or refer a non-cash sale Merchants request approval from the cardholder’s issuing bank. The approval process includes verifying the customer’s available balance against the amount of the purchase.
Authorization Amount The transaction amount submitted to the cardholder’s issuing bank for approval The issuing bank verifies that the cardholder has an available balance for the purchase and issues a reserve equal to the amount of the transaction. The reserve is in place until the transaction is captured, a void transaction is submitted, or the 30-day authorization period has expired.
Authorization Capture The process to complete a credit card purchase by authorizing and capturing or settling the funds for the transaction The capture request is submitted by the payment gateway to the card issuing bank. If the issuing bank authorizes the request, the transaction is automatically submitted for settlement.
Authorization Code The approval code transmitted by the issuing bank The Authorization Code is usually printed on the sales receipt.
Authorization Only The total amount of the transaction that is approved The payment gateway requests the authorized total amount from the card-issuing bank.
Authorization Request The process used to verify the customer’s available funds to make the purchase The outcome of a request is an Authorization Request or Authorization Capture.
Automated Teller Machine (ATM) A standalone terminal that dispenses cash, accepts deposits, receives payments, and allows customers to find out the status of their card accounts ATMs are available 24/7 and located in shopping areas, gas stations, hospitals, and in many businesses. ATMs read magnetic stripes and EMV chips.
Automatic Clearing House (ACH)

A funds transfer network that permits the electronic settlement of debit and credit transactions between bank accounts and is available nationwide to participating financial institutions.