Paymentpedia

3

• Payment Industry Terms

  3DS (3-D Secure)

  An additional security layer for online card transactions.

A

• Payment Industry Terms

  A2A (account-to-account)

  A2A payments allow for money to be moved from one account to another, without the need for third-parties.

• Payment Industry Terms

  Acquirer

  A financial institution that authorizes and settles payments for merchants. (See also Merchant of Record)

• Payment Industry Terms

  API (Application Programming Interface)

  A set of programming tools that allows software to interact with other services or applications.

• Payment Industry Terms

  APM (alternative payment method)

  Refers to any form of payment that isn’t a major international credit card brand.

• Payment Industry Terms

  ARN (Acquirer Reference Number)

  A unique number assigned to a transaction during payment processing.

• Payment Industry Terms

  Auth/Capture

  A two-step authorization process for credit card payments:

  • Authorization: verifies the cardholder's ability to pay and reserves the funds.
  • Capture: confirms the transaction and collects the funds from the cardholder.

B

• Payment Industry Terms

  BIN (Bank Identification Number)

  The first six digits of the PAN, which identifies the issuing bank.

• Payment Industry Terms

  BNPL (buy now pay later)

  BNPL differentiates itself from installment loans by primarily offering zero-interest payment installments, without the need for a credit card.

C

• Payment Industry Terms

  Card Networks (Card Schemes)

  Organizations that set rules and provide infrastructure for processing card payments (e.g., Visa, Mastercard).

• Payment Industry Terms

  Cardholder

  The person who uses a credit or debit card to make a payment.

• Payment Industry Terms

  Conversion Rate (CR)

  The percentage of transactions successfully completed compared to the total number of transactions processed.

• Payment Industry Terms

  Credit Card Payments

• Payment Industry Terms

  CVV (Card Verification Value)

  A security code (usually 3 or 4 digits) on the back of the card used for online transactions.

D

• Payment Industry Terms

  Descriptors

  Text appearing on the cardholder's statement describing the transaction.

• Payment Industry Terms

  Digital wallet/eWallet

  Digital wallets allow users to instantly transfer funds through several linked routes. The user will transfer the funds from an existing bank account, or credit/debit card information must be uploaded to transact.

F

• Payment Industry Terms

  Fallback

  An alternative processing channel used if the primary channel experiences an error.

• Payment Industry Terms

  FX (Foreign Exchange)

  The rate at which one currency is converted to another.

G

• Payment Industry Terms

  Gateway vs Processors

  • Payment Gateway: Transfers transaction data to processors or acquirers.
  • Payment Processor: Provides complete payment processing services, including data transfer, authorization, settlement, and fund collection.

I

• Payment Industry Terms

  Installments

  Prevalent in Latin America, installment credit refers to credit card-based small or micro-loans designed to purchase consumer goods.

• Payment Industry Terms

  IPN (Instant Payment Notification)

  A real-time notification sent after a transaction is complete.

• Payment Industry Terms

  Issuer

  The financial institution that issues a credit or debit card to a cardholder.

K

• Payment Industry Terms

  KYC (Know Your Customer)

  Regulations requiring businesses to verify the identity of their customers.

M

• Payment Industry Terms

  Marketplace

  An online platform where multiple vendors sell products or services.

• Payment Industry Terms

  MCC (Merchant Category Codes)

  Codes that classify businesses by industry type.

• Payment Industry Terms

  Merchant of Record (MoR)

  The entity legally responsible for processing customer credit card transactions. dLocal acts as a local MoR in each market

• Payment Industry Terms

  Mobile money

  Mobile money is a local payment method prevalent in emerging markets. Users can deposit cash at registered agents, and send funds using an account linked to their mobile number without internet access.

P

• Payment Industry Terms

  PAN (Primary Account Number)

  The main card number displayed on the front of the card.

• Payment Industry Terms

  Payment Types

  Different methods for making online payments (e.g., credit cards, bank transfers, cash tickets, eWallets, etc.).

R

• Payment Industry Terms

  Refunds and Chargebacks

  • Refund: A credit issued to a customer by the merchant.
  • Chargeback: A credit issued to a customer by their bank, typically due to unrecognized charges.
• Payment Industry Terms

  RTP (real-time payment)

  A payment method that links up and pulls money straight from a bank account and into a customer’s, in real time.

S

• Payment Industry Terms

  Sale

  A single-step transaction where the card is charged immediately.

• Payment Industry Terms

  Save

  Tokenization of cardholder information for recurring payments.

• Payment Industry Terms

  Settlement Types

  Different options payments are settled between dLocal and merchants:

  • Cross-border: dLocal collects payments locally and settles in USD abroad.
  • Local-to-local: dLocal collects and settles payments in the same local currency.
  • FX@Transfer: dLocal collects payments locally, and converts to USD/EUR for settlement with the merchant.
• Payment Industry Terms

  Smart chaining

  Recover failed and rejected card payments with the alternative that better fits the transaction.

• Payment Industry Terms

  Smart routing

  AI-driven transaction routing to the best-converting processor.

• dLocal Specific Terms

  Smartfields

  Customizable payment fields hosted by dLocal but embedded in the merchant

T

• Payment Industry Terms

  Tokenization

  Replacing sensitive data (like credit card numbers) with a secure token for future use.