We write about a lot of payment card industry-specific staff here in this article: services, systems, products, best practices, etc. We try to explain, as best we can, how the credit card processing world functions and, more to the point, where your place in it is. The topics covered below can be categorized into 3 groups: first, the subjects that demand total comprehension. Second are topics that require only a basic understanding; and the last group would be of topics that are naturally followed perfectly well without even being aware of their existence or meaning.
The system that we will review in this article falls squarely into the first of the above categories. It is Visa’s payment system, the biggest payment processing platform in the world, and the one that is likely to handle Visa’s system includes technology, products, services, and marketing programs that facilitate the electronic exchange of information and funds among financial institutions, merchants, consumers, businesses, non-profits, and governments. Visa defines the rules that enable financial transactions to be completed safely and reliably, including functional and technical specifications. The majority of your card transactions. So, let’s take a look at how Visa works.
What Is Visa’s Payment System?
Visa’s system includes technology, products, services, and marketing programs that facilitate the electronic exchange of information and funds among financial institutions, merchants, consumers, businesses, non-profits, and governments. Visa defines the rules that enable financial transactions to be completed safely and reliably, including functional and technical specifications.
Who Participates in Visa’s Payment System?
The following entities take part in each transaction facilitated by Visa’s system.
- Merchant : an entity (business or non-profit) that is authorized to accept Visa-branded cards for the payment of products and services.
- Acquirer (also known as a merchant bank) : a financial institution and a Visa member that contracts with merchants to accept Visa cards for the payment of goods and services.
- Cardholder : an authorized user of Visa cards.
- Issuer : a financial institution and a Visa member that issues Visa cards for use in transactions and enters into agreements with its cardholders for the billing and payment of these transactions.
- Visa Inc. :a publicly traded company that collaborates with financial institutions that issue Visa cards (the issuers) and/or sign merchants to accept Visa-branded cards as payment for goods and services (the acquirers). Visa provides card products, promotes the Visa brand, and establishes the rules and regulations governing the processing of payments involving its cards. Visa also operates the world’s largest retail electronic payments network to facilitate the flow of transactions between acquirers and card issuers.
- VisaNet : a part of Visa’s retail electronic payment system, VisaNet is a collection of systems that includes:
- an authorization service through which card issuers can approve or decline individual Visa card transactions.
- a clearing and settlement service that processes transactions electronically between acquirers and issuers to ensure that:
- Visa transaction information is sent from acquirers to issuers for posting to cardholders’ accounts.
- Payments for Visa transactions are facilitated from issuers to acquirers to be credited to merchant accounts.