Glossary of Terms – POS and Payment Processing

The payment processing industry confuses many people because it uses many unique words and acronyms specific to the industry. Since payment processing is a vital part of our customer’s businesses, we feel it is important to get past this “language” so we can service you better. Although our list isn’t exhaustive, it does include the most used words and acronyms used in the field today.

Acquirer – Also referred to as “acquiring bank” or “acquiring financial institution.” Entity that initiates and maintains relationships with merchants for the acceptance of payment cards. Cardholder – Non-consumer or consumer customer ot whom a payment card is issued to or any individual authorized to use the payment card.

Cardholder Data – At a minimum, cardholder data consists of the full PAN. Cardholder data may also appear in the form of the full PAN plus any of the following: cardholder name, expiration date and/or service code.

Cardholder Data Environment – The people, processes and technology that store, process or transmit cardholder data or sensitive authentication data, including any connected system components.

Card Verification Code or Value - Also known as Card Validation Code or Value, or Card Security Code. Refers to either: (1) magnetic-stripe data, or (2) printed security features.

(1) Data element on a card's magnetic stripe that uses secure cryptographic process to protect data integrity on the stripe, and reveals any alteration or counterfeiting. Referred to as CAV, CVC, CVV, or CSC depending on payment card brand. The following list provides the terms for each card brand:
_ CAV – Card Authentication Value (JCB payment cards)
_ CVC – Card Validation Code (MasterCard payment cards)
_ CVV – Card Verification Value (Visa and Discover payment cards)
_ CSC – Card Security Code (American Express)

(2) For Discover, JCB, MasterCard, and Visa payment cards, the second type of card verification value or code is the rightmost three-digit value printed in the signature panel area on the back of the card. For American Express payment cards, the code is a four-digit unembossed number printed above the PAN on the face of the payment cards. The code is uniquely associated with each individual piece of plastic and ties the PAN to the plastic. The following list provides the terms for each card brand:
_ CID – Card Identification Number (American Express and Discover payment cards)
_ CAV2 – Card Authentication Value 2 (JCB payment cards)
_ CVC2 – Card Validation Code 2 (MasterCard payment cards)
_ CVV2 – Card Verification Value 2 (Visa payment cards)

IP - Acronym for “internet protocol.” Network-layer protocol containing address information and some control information that enables packets to be routed. IP is the primary network-layer protocol in the Internet protocol suite.

ISO - Better known as “International Organization for Standardization.” Nongovernmental organization consisting of a network of the national standards institutes of over 150 countries, with one member per country and a central secretariat in Geneva, Switzerland, that coordinates the system.

Issuer - Entity that issues payment cards or performs, facilitates, or supports issuing services including but not limited to issuing banks and issuing processors. Also referred to as “issuing bank” or “issuing financial institution.”

Issuing services - Examples of issuing services may include but are not limited to authorization and card personalization.

Magnetic Stripe - Also referred to as “track data.” Data encoded in the magnetic stripe or chip used for authentication and/or authorization during payment transactions. Can be the magnetic stripe image on a chip or the data on the track 1 and/or track 2 portion of the magnetic stripe.

Merchant - For the purposes of the PCI DSS, a merchant is defined as 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. Note that a merchant that accepts payment cards as payment for goods and/or services can also be a service provider, if the services sold result in storing, processing, or transmitting cardholder data on behalf of other merchants or service providers. For example, an ISP is a merchant that accepts payment cards for monthly billing, but also is a service provider if it hosts merchants as customers.

PAN - Acronym for “primary account number” and also referred to as “account number.” Unique payment card number (typically for credit or debit cards) that identifies the issuer and the particular cardholder account.

Payment Application - Any application that stores, processes, or transmits cardholder data as part of authorization or settlement.

Payment Cards - For purposes of PCI DSS, any payment card/device that bears the logo of the founding members of PCI SSC, which are American Express, Discover Financial Services, JCB International, MasterCard Worldwide, or Visa, Inc.

PCI - Acronym for “Payment Card Industry.”

PED – PIN entry device.

Personally Identifiable Information – Information that can be utilized to identify an individual including but not limited to name, address, social security number, phone number, etc.

PIN – Acronym for “personal identification number.” Secret numeric password known only to the user and a system to authenticate the user to the system. The user is only granted access if the PIN the user provided matches the PIN in the system. Typical PINs are used for automated teller machines for cash advance transactions. Another type of PIN is one used in EMV chip cards where the PIN replaces the cardholder’s signature.

POS - Acronym for “point of sale.” Hardware and/or software used to process payment card transactions at merchant locations.

SAQ - Acronym for “Self-Assessment Questionnaire.” Tool used by any entity to validate its own compliance with the PCI DSS.

Virtual Terminal - A virtual terminal is web-browser-based access to an acquirer, processor or third party service provider website to authorize payment card transactions, where the merchant manually enters payment card data via a securely connected web browser. Unlike physical terminals, virtual terminals do not read data directly from a payment card. Because payment card transactions are entered manually, virtual terminals are typically used instead of physical terminals in merchant environments with low transaction volumes.