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Sertifi's Payment Glossary

Working with payments and all of the terms that come with it can sometimes feel intimidating - like you have to learn a whole other language. Don’t worry, we’ve got you. To aide any confusion, we have created this payment glossary – a living document where we will house as many payment-related terms as we can find to set you up for success. Soon, you will be speaking payment lingo like a pro. 

Last Updated: 4/14/2023


  • 3-D Secure (3DS) - a protocol designed to be an additional security layer for online credit and debit card transactions in the merchant/acquirer domain, the issuer domain, and the interoperability domain 


  • Authorization Fees - fees that are charged to a merchant every time a credit card is used and checked out to ensure a secure transaction 
  • Automated Clearing House (ACH) - a network of domestic financial institutions that provide a variety of automated electronic transactions 
  • Address Verification Services (AVS) - a fraud prevention system meant to limit fraud and chargebacks by verifying that the address entered by the customer is associated with the cardholder's credit card account 
  • Acquiring Bank - a financial institution, that processes payment card transactions for merchants and is defined by a payment brand as an acquirer 
  • Authorizationoccurs when a merchant receives a transaction approval after the acquirer validates the transaction with the issuer/processor 


  • Bank Transfer – when customers pay directly from their bank account
  • Branded Cards – credit cards offered by big companies, usually used for rewards 


  • Cardholder – any individual authorized to use a payment card and/or an individual whose payment card is issued to them personally 
  • Cardholder Data (CHD) - any information found on a customer’s card including verification codes 
  • Card Authentication Value (CAV) - a card holder’s verification code on JCB payment cards
  • Card-Not-Present Transaction – when a customer’s card is not physically present for a transaction 
  • Card-Present Transaction - when a customer’s card is physically present for a transaction 
  • Card Security Code (CSC) - a cardholder’s verification code on American Express cards 
  • Card Validation Code (CVC) - a card holder’s verification code on Mastercard payment cards 
  • Card Verification Value (CVV) - a card holder’s verification code on Visa and Discover cards 
  • Chargebacks – the act of disputing the validity of a transaction in an effort to receive a refund, customers will dispute a transaction with their issuing bank who will reverse the transfer of funds from the customer to the merchant 
  • Chargeback Reason Codes – a 2-to-4-digit alphanumeric code provided by the issuing bank involved in a chargeback, used to identify the reason for the dispute 
  • Common Vulnerability Scoring System (CVSS) - an industry standard designed to convey the severity of computer system security vulnerabilities and help determine a level of urgency and the priority of response
  • Consumer - an individual who purchases goods, services, or both


  • Early Termination Fees – fees merchants could face if they are looking to leave their current processing contract before the agreed upon end date 
  • E-commerce – the electronic, digital commerce that takes place over the internet
  • Encryption – the process of converting information into an incomprehensible form except to holders of a specific cryptographic key


  • Fiat Money - a currency issued by a government 
  • Fraudsters - a person who commits fraud, especially in business dealings
  • Frictionless Payments - online and offline checkout processes where the barriers of buying have been minimized


  • Hidden Processing Costs - fees that are involved in the production or management of a business and are difficult to identify 


  • Information Security - protection of information to insure confidentiality, integrity, and availability
  • Issuing Bank – a bank that supplies physical credit cards and debit cards


  • KYC Banking Regulations - a legal requirement for financial institutions and financial services companies to establish a customer’s identity and identify risk factors, helping prevent identity theft, money laundering, and other financial crimes


  • Merchant - any entity that accepts payment cards bearing the logos of any of the five members of PCI SSC (American Express, Discover, JCB, MasterCard or Visa) as payment for goods and/or services
  • Monthly Minimum Fees – a fee a processor could charge based on their minimum transaction requirements and the merchant’s ability to meet them each month 
  • Monthly Settlement Fee – a monthly fee charged by a processor that does not coincide with any actions taking place by the processor or the processor itself 
  • Multifactor Authentication (MFA) - a method of verifying an individual based on at least two discrete elements of the following three categories: 1) possession, such as a mobile device; 2) biometrics, such as a fingerprint; and 3) knowledge, such as a passphrase  


  • Network Segmentation - isolates system components that store, process, or transmit cardholder data from systems that do not


  • Primary Account Number (PAN) - a unique number (typically for credit or debit cards) that identifies a card issuer and the particular cardholder account
  • Payment Application - a software application that stores, processes, and/or transmits cardholder data as part of authorization or settlement, where the payment application is sold, distributed, or licensed to third parties
  • Payment Gateway - on-property technology used to connect properties with payment processors
  • PCI Compliance Fees – fees that merchants can be charged if they are not fully complying with the payment card industry data security standards (or PCI DSS for short).
  • PIN Transaction Security (PTS) - a set of requirements set by the PCI Security Standards Council that prove a network to be PCI compliant and for a PIN to be accepted by POI terminals
  • PIN Verification Value (PVV) - a hidden value encoded in the magnetic stripe of a payment card 
  • Point-of-Interaction (POI) - the initial point where data is read from a credit card 
  • Point-of-Sale (POS) - when and where a transaction occurs


  • Representment - the process in which businesses respond to chargebacks to figure out its legitimacy  
  • Remittance Transfers - bank transfers made across international borders 
  • Report on Compliance (ROC) - a report documenting detailed results from an entity’s PCI DSS assessment 


  • Statement Fees - fees processors charge to allow one to read your bank statement
  • Surcharge - an additional fee charged by a merchant when receiving a payment by cheque, credit card, charge card or debit card meant to cover the cost of accepting that means of payment


  • Transaction Data - data related to electronic payment card transactions 
  • Transaction Fees – fees you pay for each completed transaction based on your payment processor’s processing rates
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About the author

Mimi McNulty

Mimi McNulty is a Marketing Generalist at Sertifi. While she makes a point to have a pulse on all things Sertifi, Mimi is responsible for the company's social media channels, event coordination, and blog. She also assists with content creation, creative marketing, content strategy, and internal marketing ventures. Mimi is a communication enthusiast with a passion for storytelling and media relations.