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L net revenue – Discount income less interchange expenses.
loyalty programs – Used by card issuers and merchants net settlement – Netting out of debits and credits owed
to encourage customers to make payments using specific between card issuers and acquirers; amount is equal to
cards; many are tied to mobile wallets and/or rewards sales less interchange less other fees.
cards. NFC (near field communication) – Short-range, high-
frequency wireless technology that enables smartphones
M to connect to compatible POS devices; supports tap-and-go
payments.
mag stripe cards – Traditional credit and debit cards with
magnetic stripe on back that is encoded with account O
and related information. EMV adoption is expected to
eventually eliminate need for mag stripe cards. offline authorization – Issuer-controlled process that
MATCH (Member Alert to Control High Risk) list – supports authorization without first contacting the issuer
Shared database of terminated merchant accounts that lists when transactions are below a certain floor limit.
every merchant denied access from accepting payment omnichannel – In retailing, refers to the ability to offer
cards for any number of violations of card brand rules. customers seamless shopping experiences whether they are
Formerly called Terminated Merchant File (TMF). at brick-and-mortar outlets or using PCs, mobile devices or
merchant account – Bank account established at acquiring telephones; concept is rapidly spreading across industries.
bank through which merchant-accepted payments are open to buy – Cardholder's available credit.
processed and settled.
originator – Financial institution that initiates a wire
merchant agreement – Written agreement between transfer or ACH payment. Also known as originating
merchant and acquirer detailing each party's rights, depository financial institution (ODFI).
responsibilities and warranties. P
merchant category codes – Four-digit numbers assigned
merchants to denote business type/service. PAN (primary account number) – Numeric code embossed
MICR (magnetic ink character recognition) – Numbers on front of payment card and encoded on the mag stripe;
imprinted with magnetic ink at the bottom of a check identifies the issuer and cardholder's account number and
detailing routing/transit, account and check number. includes validation number.
micro merchant – Very small businesses that accept fewer partial authorization – An issuer's partial approval of a
than 100 card payments a year and/or generate less than prepaid authorization request; merchants can complete
about $25,000 a year in processing volume. Many micro sale with split tender processing.
merchants also accept micro payments.
payfac (payment facilitator) – Merchant services provider
micro payments – Very small transactions (common in that operates a platform for businesses that don't have their
online sales) of $1 or less. own merchant accounts. Considered sub-merchants, these
MLS (merchant level salesperson) – Independent agent/ businesses process transactions through a master account
salesperson who sells payment processing and other owned by the payfac. Payfacs assume full responsibility for
business services to merchants; must adhere to rules for all sub-merchant losses and chargebacks.
working with ISOs registered with acquiring banks. PCI DSS (Payment Card Industry Data Security Standard)
mobile POS (mPOS) – Point of sale system or device that –Standards and procedures for protecting cardholder
is not in a fixed location and enables mobile payment information before, during and after a payment transaction
acceptance. has taken place. Managed by the PCI Security Standards
Council.
mobile wallet – Mobile payment application that runs on
smartphones (for example, Apple Pay, Chase Pay). phishing – Fraudulent emails/text messages, purportedly
from trusted entities (such as banks), seeking to dupe
MO/TO (mail order/telephone order) – Card transactions recipients into providing sensitive information (for
that do not occur in person. Instead of capturing card example, passwords and account numbers).
information electronically for processing, it is entered
remotely. PIN (personal identification number) – Number used by
an individual cardholder to authenticate transactions; most
N commonly used with debit cards.
PIN authorization request – Procedure enabling card
NABU (network access and brand usage) – Per-transaction issuer to validate cardholder's identity.
fee assessed by Mastercard, similar to Visa's acquirer access
fee. PIN pad – Device used to enter PIN that can be part of a
POS terminal or a peripheral.
net payment – Payment made to merchant for sales drafts
less credits minus appropriate discount fee and any point-to-point encryption – See encryption.
chargebacks. prepaid card – Debit card that can be used to spend only up
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