Payment Card Transaction Lifecycle

There are many parties involved in the lifecycle of a payment card transaction (regardless of the channel if come through – i.e., face to face or “card present” transactions, card no present transactions like online or telephone purchases, etc.). Refer to the diagram below for a graphical depiction of the flow.

  1. Acquirer– Also referred to as “merchant bank,”“acquiring bank,” or “acquiring financial institution.” Entity, typically a financial institution that processes payment card transaction for merchants, and is defined by a payment brand as an acquirer.  Acquirers are subject to payment brand rules and procedures regarding merchant compliance.  See also Payment Processor.
  2. Payment Processor–Sometimes referred to as “payment gateway” or “payment service provider (PSP)”. Entity engaged by a merchant or other entity to handle payment card transactions on their behalf. While payment processors typically provide acquiring services, payment processors are not considered acquirers unless defined as such by a payment card brand.
  3. 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,” and is the cardholder’s (consumer)bank.
  4. 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.
  5. Service Provider – Business entity that is not a payment brand, directly involved in the processing, storage, or transmission of cardholder data on behalf of another entity. This also includes companies that provide services that control or could impact the security of cardholder data. Examples include managed service providers that provide managed firewalls, IDS and other services as well as hosting providers and other entities. If an entity provides a service that involves only the provision of public network access—such as a telecommunications company providing just the communication link—the entity would not be considered a service provider for that service (although they may be considered a service provider for other services).
  6. Consumer– Individual purchasing goods, services, or both.
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