Who’s Involved in Credit Card Processing?

Every transaction made requires an entire chain of participants, ensuring the process is seamless. Here’s every participant involved:

• Cardholder: A customer who uses a credit or debit card at checkout.
• Credit card: A card with payment credentials used to make a purchase. Each credit card has a unique EMV chip embedded on the card, adding additional transaction security and reducing fraudulent transactions.
• Merchant: A business (like yours) that accepts credit cards as a form of payment.
• POS: The point-of-sale system used by the merchant (your business) to accept credit card payments.
• Issuing bank: Provides the customer with their credit card and an accompanying line of credit. Examples include U.S. Bank and BMO*.
• Acquiring bank: This is your credit card processor's banking relationship, which will collect the card transaction information from your POS system and route the transaction through the card network and the card issuing bank for authorization, settlement and funding to your business's depository bank.
• Card network: This is the card brand “middleman” (like Visa, Mastercard, and Discover) that manages the network to authorize, settle and eventually direct your customer's payment request to your business. It goes from your credit card processor and the acquiring bank to your customer’s card issuing bank. Then, it returns with either an approval or a decline.
• Merchant services provider: The company that may provide your business the tools and services to accept payments. They put everything in motion, so each step in the transaction process connects properly between banks, card networks, and your POS system. 
• Payment gateways: Facilitate the transfer of payment information between a payment portal, such as a business website and the credit card processor and the acquiring bank.

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