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American Express (AMEX): A global payments, network and travel company since 1850. AMEX began issuing credit cards in 1958. U-M units can decide to accept AMEX along with Visa, MasterCard, and Discover cards, but need to specifically request to do so.
Approved Charging Unit: An organization or unit approved by the Treasurer’s Office to process credit/debit card sales.
AVS: Address Verification Service enables Merchants to verify a cardholder’s billing address before completing a transaction.
Authorization: The process of verifying that the payment card has sufficient funds available to cover the amount of the transaction, and that the card is authentic and not reported as stolen. An authorization number is obtained for every sale.
Authorization Fees: A fee charged by the merchant acquirer for handling Discover and/or American Express transactions. This fee is not related to discount fees.
Bank Card: A payment card issued by a financial institution. The most common Bank Card are MasterCard and Visa branded payment cards.
Batch: The collective amount of transactions in the Merchant’s terminal or point of sale (POS) device that have yet to be settled.
Card Associations: Visa, MasterCard, Discover, and American Express are the major card association and their credit/debit cards are accepted by University Merchants. (Visa, MasterCard and Discover Cards are accepted by default, while American Express and PIN-based debit cards are optional.)
Cardholder: A person who uses a payment card to purchase goods and services.
Chargeback: A customer dispute over a specific charge to their payment card. The Merchant is notified of the dispute and must respond timely to the chargeback, offering proof of validity for the transaction.
Check Card: Payment card whose funds are withdrawn directly from the cardholder’s checking account. Also known as a debit card.
Commercial Card: A payment card used by business to cover expenses such as travel, entertainment, and purchasing.
Copy Request: A request for a Merchant to provide a copy of the original sales slip for a particular transaction. Copy requests should be acted on within ten days, and if ignored, can lead to chargebacks.
Corporate Card: A payment card used for business-related expenses such as travel and entertainment.
Credits (Refunds): Departments must specify in writing (in the Merchant Card Policy document) to the Treasurer’s Office the person or persons that will be allowed to approve a Credit (Refund) Slip. This cannot be the same person who processes sales.
Debit Card: A payment card whose funds are withdrawn directly from the cardholder’s checking account. Some debit cards have Visa or MasterCard logos, which can be used for purchases at debit or Visa and MasterCard merchants. Also see Check Card and PIN-based Debit cards.
Discount Rate (Fee) : A collection of fees charged by the merchant acquirer to process the Merchant’s transaction. This includes interchange fee, assessment, and per item charges. These fees are displayed on the monthly Merchant statement and also the unit's state of account. The discount rate is separate from authorization fees.
Discover Card: Dean Winters Financial Services group launched the Discover Card in 1986. Discover Card is accepted in the U.S., Mexico and the U.K. U-M units are set up by default to accept Discover Cards when they become Merchants.
e-Commerce: Electronic Commerce is the act of conducting retail operations through the Internet.
Electronic Ticket Capture: The transmission of sales to a credit/debit card processor through the use of electronic equipment. Credit/debit card terminals are the most common devices used for this purpose. Other options for processing include software to allow batch processing, Web processing, cash registers with terminal built-in, and touch tone phone processing.Encryption: The process of encoding electronic transaction information, to allow secure transmission of data over the Internet.
Fifth Third Bank: U-M's current contracted bank for merchant processing. Fifth Third Processing Solutions is the specific bank group that provides these services.
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Interchange: The card association function that enables members to exchange payment card transaction data and funds on standardized basis.
Interchange Fee: For purchases, the fee charged to the acquirer and paid to the card issuer. Also known as “Interchange Reimbursement Fee.” This is part of the discount fee.
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Manual Imprinter: A manual device used with a sales draft to obtain an impression of the payment card when electronic authorization is unavailable or the cardholder's magnetic stripe is unreadable.
MasterCard: A global payments and network company. A group of banks created a member association in 1966. Over the years the cards evolved to be MasterCards. U-M Merchants are set up by default to accept MasterCard credit cards, while debit cards are optional.
Merchant: A University organization or department that accepts credit/debit cards as payment for goods and services.
Merchant Number: An identifying number assigned by the merchant acquirer to each Merchant. Each U-M department that accepts credit/debit cards has their own unique merchant number.
Merchant Acquirer: A bank or its affiliate that provides services for processing credit/debit card transactions. U-M contracts with Fifth Third Bank and Fifth Third Processing Solutions.
Network Vulnerability Scans: Wireless Security and Network Vulnerability scanning tests will be performed on each Merchant in order to comply with the PCI Data Security Standard.
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Payment Card: A broad term, applying to any magnetic coded card used to make purchases. Currently, U-M units can be set up to accept the following cards: Visa, Mastercard, Discover, American Express, and PIN-based debit cards.
Payment Card Industry (PCI) Data Security Standard: A standard created by MasterCard and Visa to protect cardholder information. Compliance is mandatory for all University Merchants.
PIN-based Debit Card: a payment card that deducts the purchased amount from the cardholder's bank account. The cardholder authorizes the transaction by entering the Personal Identification Number (PIN) associated with the debit card. U-M Merchants must specifically request to accept PIN-based Debit cards. Merchants are not set up by default to accept PIN-based debit cards.
Pre Item Charge: Fees paid to the processor on a per transaction basis. This is part of the discount fee.
POS: The Point of Sale is the physical or web location where a sales transaction occurs, and payment is authorized.
Processor (Merchant Acquirer): An organization that is connected to a card association and provides authorization, clearing and settlement services on behalf of a member.
Procurement Card: A payment card typically used by government organizations, which allows for large expenditures.
Purchasing Card: A payment card designed specifically for smaller volume business-to-business purchases made by mid or large size corporations.
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Refunds (Credits): Departments must specify in writing (in the Merchant Card Policy document) to the Treasurer’s Office the person or persons that will be allowed to approve a Credit/Refund Slip. This cannot be the same person who processes sales.
Sales Draft: The multi-copy paper form used by the Merchant, and signed by the cardholder, to document the transaction. Generally this item is used when the card authorization system is unavailable or when the cardholder's magnetic stripe is unreadable.
Settlement: The process of sending the Merchant’s batch to the card network for processing and payment. Settlement should occur each business day.
Software: Programming that determines the characteristics and features of the terminal.
T&E Card: A form of corporate card used by businesses for travel and entertainment expenses.
Terminal: The Point of Sale (POS) equipment used to capture, transmit, and store payment card transactions.
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Visa: Visa is a global payment and network association. It began in 1958 when Bank of America issued BankAmericard. Over time the it became its own business and cards were renamed called Visa cards. Multiple banks that issue Visa cards on the governing board. There are Visa credit and debit cards. U-M Merchants are set up by default to accept Visa credit cards, while debit cards are optional.
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