ROUTINE HOSTING'S ECOMMERCE GLOSSARY   A      B      C      D      E      F      G      H      I      J      K      L      M      N      O      P      Q      R      S      T      U      V      W      X      Y      Z   A Acquiring Bank The bank that does business with merchant(s) who accept credit cards. A merchant has an account with a bank and each day deposits the value of the day's credit card sales. Acquirers buy (acquire) the merchant's sales slips and credit the tickets' value to the merchant's account. Also known as Merchant Bank. Acquiring Processor The processor provides credit card processing, billing, reporting & settlement, and operational services to acquiring and issuing banks. Many financial institutions don't do their own bankcard processing because it's more cost-effective to let someone like First Data Corporation (FDC) invest in the equipment and personnel and do it for them. Also known as Payment Processor. American Express An organization that issues cards and acquires transactions, unlike Visa and MasterCard, which are bank associations. Approval An acceptance of a payment. Usually in the form of an authorization code provided by the issuing bank. Authentication Verifying that a person is who he/she claims to be, or that an email message is actually from the person or organization that claims to have sent the message. Authorization The act of insuring that the cardholder has adequate funds available against their line of credit. A positive authorization results in an authorization code being generated, and those funds being set aside. The cardholder's available credit limit is reduced by the authorized amount. Authorization Capture A payment capture method that is used by merchant(s) who ship orders on the same day that they receive orders. The payment is captured when the merchant authorizes the credit card used by the customer. Authorization Code A numerical or alphanumerical code sent by the card issuer verifying that the sale has been authorized. The authorization may be obtained by voice, software, or terminal transmission. The merchant should include the authorization number on the sales draft to facilitate the authorization process. Authorization Request An electronic message sent from the merchant's business to the customers credit card issuing bank to request an authorization code for a sale transaction. Authorization Response An issuing bank's electronic message reply to an authorization request. Back to Top B Bank An institution that handles savings and checking accounts, issues loans and credit, and deals in government and corporate issued securities. Bank Account An account that holds funds within a bank and is subject to additional deposits and withdrawals. Batch Settlement Each time an order is placed, it is approved and added to a "batch". But the funds have not actually been charged against the credit cards nor transferred to the merchant's bank account. That happens when the business manager accesses the Back office Order interface to first "capture" the funds for orders in a batch and then to "settle" the batch. Capturing the funds causes the credit cards to get charged and the funds to be transferred to the merchant bank account. Browser A client to a web server that allows the user to read hypertext documents on the World Wide Web. Netscape Navigator and Microsoft Internet Explorer are examples of popular web browsers. Business Community A central point where buyers and sellers can engage in electronic commerce, or build and manage an online business. Back to Top C Capture The act of converting the authorization amount into a billable transaction record. Transactions cannot be captured unless previously authorized, and authorizations should not be captured until the goods or services have been shipped or transmitted to the consumer. Cardholder Any person who opens a credit card account and makes purchases using a credit card. Card Reader A magnetic card reader is a device used to scan cards containing magnetic data strips such as on the back of credit cards. Cash Money in the form of paper or coin that is readily available for use as a medium of exchange. Certificate An electronic affidavit, issued by a trusted organization, like a bank, that vouches for the identity and the authority of an individual or business to conduct any transaction over the Internet. Certificate Authority A Certificate Authority can be an issuer of Security Certificates used in SSL connections, as well as a trusted third-party organization that can verify the identity and origin of a person or organization. These institutions issue digital certificates directly to end-users or to other certificate authorities allowing them to also issue digital certificates. A certificate authority, such as Thawte or VeriSign, vouches for the identity and the authority of an individual or business to conduct transactions over the Internet. Chargeback The process of taking back, or debiting, the merchant's credit card funds after the funds have been paid to the merchant. This occurs when a customer disputes a credit card transaction. The merchant must respond to the chargeback and provide proof that the product or service was provided to the customer. Checking Account A bank account that the account holder can draw checks against without giving prior notice or having a passbook. Clearing The process a check goes through to validate and transfer funds between banks. An electronic check will clear in the same manner as a paper check. Common Gateway Interface (CGI) Script A computer program that allows web servers to forward requests for processing to other programs, which then return their results to the web server. Connection Establishing Contact with a remote computer. Consumer A person who purchases goods and services. Credit The extension of funds issued by a bank that allows a consumer to purchase goods or services from a merchant. The consumer then pays back the bank either in full or in installments, at an interest rate determined by the bank. Credit Card A bank-issued card that allows consumers to purchase goods or services from a merchant on credit. Credit Card Gateway A reference to both the actual machine and the company hosting the credit card gateway server, acting as a middleman between the merchant and the merchant bank. The Credit Card Gateway passes data between the merchants business website and the bank. Credit Deposit The value of a merchant's credit card purchases that are credited to its bank account after the acquirer buys the merchant’s sales slips. The deposit is credited. It is not funded until the acquirer gets the monetary value from the issuer during settlement. Back to Top D DDA Demand Deposit Account A bank account, such as a checking account, that allows the holder to withdraw funds or use funds for payment upon demand. Debit The process of subtracting from the balance of an account. Debit Card An ATM bankcard. This type of card allows a merchant to deduct money directly from a customer's bank account. Decrypt The process of converting encrypted data or text back to plain data or text. Denial When permission to perform a particular action has been declined. DES Data Encryption Standard. Digital Cash Money, in the form of information, that can be stored in electronic wallets or on smart cards. Digital cash systems have been designed for use on the Internet for so-called ’micropayments’ – payments for goods that are too inexpensive to be paid for by credit cards. Digital Certificate A digital certificate is a special kind of message that contains information about who it belongs to, who it was issued by, a unique serial number or other unique identification, valid dates, and an encrypted "fingerprint" that can be used to verify the contents of the certificate. Digital certificates are issued by trusted third parties, known as Certificate Authorities. The public key of the merchant’s digital certificate is used to encrypt the shopper’s order information before it is emailed to him. Digital Goods Digital goods are products that can be distributed electronically. Examples of digital goods, also known as soft goods, include software, music files, images, or any other types of data that can be sent electronically from one computer to another. Digital ID A chunk of information (often stored as a text file) that is used by the SSL protocol to establish a secure connection. A Security Certificate contains information about whom it belongs to, who it was issued by, a unique serial number or other unique identification, valid dates, and an encrypted "fingerprint" that can be used to verify the contents of the certificate. In order for an SSL connection to be created both sides must have a valid Security Certificate. Digital Signature A way to ensure whether a message was actually sent by the person who claimed to have sent it. The sender's private key encrypts the signature, and the recipient decrypts the signature with the sender’s public key. Digital signatures use public key cryptography and work in conjunction with certificates. Discount Rate A percentage rate that is charged by the acquiring bank for processing a merchant’s transaction. The type of business and/or how the credit card is processed usually determine this rate. Retail based transactions, also known as Card Present transactions are assigned lower discount rates than MO/TO, also known as Mail Order/Telephone Order, Internet, or Card Not Present transactions. Download The transfer of data from a host computer to a client computer over a network, in this case, the Internet. Drop-shipping An arrangement whereby a mail-order or Internet merchant accepts orders for products, and then pays a manufacturer or distributor to ship the product to the customer. Back to Top E Electronic Check An electronic version of the traditional paper check. It includes all the components of a paper check and can be used as a method of payment on the Internet. Electronic Check Security A combination of state of the art technology and established business practices to prevent fraud on electronic checks. Electronic check pilots are currently being conducted using a combination of technology tools, data encryption, digital signatures, certificates, secure e-mail and smart card technology to ensure that the security of the system is not compromised. Electronic Check Verification The validation of an electronic check using certificates and digital signatures. Once the electronic check is deposited, the bank will perform additional verification against internal databases. Electronic Wallet Also called a virtual wallet, a software mechanism that allows commerce server users to store and use credit card and electronic payment information. Typically, information in the wallet is encrypted and is persistent from session to session. Encrypt The process of scrambling a message to ensure data secrecy. The message is encoded using an electronic key, which makes it unintelligible to anyone except to the holders of the other half of the key. There are two main types of encryption methods, private key and public key encryption. Back to Top F Financial Institution An institution that obtains capital from individuals, businesses, and other organizations and invests it in various financial assets. Funds The amount of money available for a consumer to use to make purchases. Back to Top G Gateway A device that allows for the translation and management of communication between networks that use different protocols or designs. Goods All things bought or sold that can be made or grown such as clothes, food, cars, etc. Back to Top H Hard Goods Tangible products that are distributed through the postal or other delivery service. Contrasts with soft goods, which are distributed electronically. Helper Application A software application that supports another software application. Host A computer running Internet protocols that can act as either a client or a server on the Internet. Host Capture A credit card processing model where the authorization and capture of the transaction data are accomplished within a single message sent to the payment processor. HTML HyperText Markup Language The formatting or document description language use to create World Wide Web pages. HTTP HyperText Transfer Protocol Allows for the exchange of HTML documents over the World Wide Web. HTTP Proxy Server A server that forwards client requests using the HyperText Transfer Protocol (HTTP) over the World Wide Web. Back to Top I Imprint An imprint of a customer's credit card can be electronic, swiping the card through a credit card terminal, or manual, taking a physical impression of the credit card. Either of these two methods is required to prove the customer's credit card was present. Incentive A reduction in price given to customers after a purchase has been made. Integration The act of combining or coordinating several parts or elements into an entire whole. Interchange The exchange of information, transaction data and money among banks. Interchange systems are managed by associations like Visa and MasterCard, and are very standardized so banks and merchants worldwide can use them. Interchange Fee A fee paid by the acquiring bank/merchant bank to the issuing bank. The fee is meant to compensates the issuer for the time after settlement with the acquiring bank/merchant bank and before it recoups the settlement value from the cardholder. Internet The Internet is the world's largest computer network; it is essentially a network of networks. Any device attached to the Internet can communicate with any other device on the network. Some uses of the Internet include sending and receiving email, browsing websites, and increasingly, the buying and selling of goods and services. Internet merchant A business owner who sells products or services over the Internet. IP Address A unique number that is assigned to any device connected to the Internet. ISO Independent Sales Organization An organization that performs merchant solicitation, sales or service on behalf of financial institutions and/or processors. Issuer The bank that extends credit to customers through bankcard accounts. The bank issues the credit card and receives the cardholder's payment at the end of the billing period. Also called the issuing bank or the cardholder bank. Issuing The act of providing a bank card to a cardholder and authorizing them to use it to make financial transactions. Back to Top J No Terms Defined. Back to Top K Key pair The use of the public and private key together. The public key is used to exchange and encrypt the private key. Back to Top L Link A URL hidden behind a formatting option that may take the form of a colored item of text, logo or image, and which allows a user to automatically move between WWW pages, WWW sites or within a WWW document. Logs Records of network activities. These activities can include access records, errors, and financial transactions. Back to Top M Mall A group of businesses, usually retail, that have individual managements, but are also managed under one administrator. Online malls are virtual malls, and may consist of one business under individual management. Manual Entry The entering of credit card information via computer keyboard or terminal keypad instead of swiping the card through a credit card reader terminal. ecOrderDesk support the act of manually entering a customers credit card information for processing directly against a payment gateway. MasterCard An association of banks that governs the issuing and acquiring of MasterCard transactions. Merchant Any business that agrees to accept credit cards and debit cards in exchange for goods or services. In terms of Internet Commerce, a merchant is any website that is selling physical goods, services, or digital content to consumers or other businesses. Merchant Account A written, commercial bank account established by contractual agreement between a merchant/business and a bank and/or a payment gateway. The agreement contains the respective rights, warranties, and duties with respect to accepting bankcards like Visa or MasterCard. You must apply for this account directly from your bank, or from the Payment Processor. Merchant Bank The bank that does business with merchants who accept credit cards. A merchant has an account with a bank and each day deposits the value of the day’s credit card sales. Acquirers buy (acquire) the merchant’s sales slips and credit the tickets’ value to the merchant’s account. Also known as Acquiring Bank. Merchant ID A unique set of numbers or letters and numbers that is associated with a specific merchant. The merchant ID is typically tied to a system database record that contains all merchant specific information regarding that particular merchant. This is provided by the bank or the Payment Processor. Merchant Service Agreement A contract that outlines the terms for accepting and processing credit cards between an acquiring bank and/or payment gateway company, and the merchant. Message Information sent and received that communicates various parts of a transaction. Micropayments Payments, usually in very small amounts ($3.00) for goods purchased over the Internet. MO/TO Refers to Mail Order / Telephone Order sales where the customer’s card is not present at the time of transaction. Money A means of payment or a measure of value. Back to Top N Network The setup of hardware and software that allows multiple computers to connect and communicate with each other electronically. The Internet is by far and away the largest network in the world. Nexus A seller’s minimum level of physical presence within a state that permits the taxing authority to require the seller to register, collect and remit sales/use tax and comply with the Country’s, Province’s, State’s and/or County’s taxing statutes and regulations. Back to Top O Offline capture A payment capture method used by merchants who ship an order one or more days after they receive it. The payment is captured when the merchant ships the order and sends a post-authorization message to the payment processor. Online A computer or user is online when connected to a network or server that allows communication flow between computers. Online capture A payment capture method used by merchants who ship an order on the same day that they receive it. The payment is captured when the credit card is authorized. Online Store A website that accepts direct payments in exchange for goods and services. Back to Top P Password A sequence of characters paired with a user name that assures only the user with that password can log on with the particular user name associated with it. Payment Capture A method used to receive payment. This method is determined by the merchant’s bank and/or payment processor. Payment Gateway A combination of software and hardware that provides an interface to the bank card processing network. Payment Methods A means for accepting payment. The most common are credit card, electronic check, phone charge, corporate account, and invoice. Payment Processor A financial institution distinct from the bank that processes data from credit card transactions. Providing pre-authorization, post-authorization, and refund services to businesses accepting credit cards. They are responsible for the distribution of funds between consumers and businesses. Sometimes also referred to as a Transaction Processor. Also knows as Acquiring Processor. Private Key Encryption An encryption system that uses two private keys for encrypting and decrypting messages. Both parties must have a secret key to decrypt a message encrypted by the other. The drawback with this method of encryption is in the difficulty of distributing the private keys. Processor A transaction processor, distinct from the bank, that processes data from credit card transactions and then distributes funds from the merchant’s bank account. Protocol On the Internet "protocol" usually refers to a set of rules that define an exact format for communication between systems. For example the HTTP protocol defines the format for communication between web browsers and web server, the IMAP protocol defines the format for communication between IMAP email servers and clients, and the SSL protocol defines a format for encrypted communications over the Internet. Public-Key Encryption An encryption system that uses two keys, a public key for encrypting messages and a private key for decrypting messages, to enable users to verify each other’s messages without exchanging secret keys. Purchase The act of providing a payment in exchange for a product or service. Back to Top Q Queries Inquiries that are performed about transactions, databases, or other records. Back to Top R Real-Time An activity which occurs ’while you wait’, rather than being delayed for processing at a later time. Reconciliation The act of balancing debits, credits, and totals between two systems. Recurring Transaction A credit card transaction permitted by a customer that is periodically charged to the customer’s account on a weekly, monthly, or quarterly basis. Refund A return of funds to a consumer for a returned product. Registration An entry of personal information in a formal record. When customers shop at your online business, they will have the opportunity to register as a member of your online business. The registration usually consists of username, password, billing/shipping address, and e-mail address. Reseller A person who is authorized to sell someone else’s goods and/or services. Response A reply, answer, or additional message that is returned to a sender. Retrieval Request A request by a bank to a merchant for documentation concerning a transaction. Usually regarding a customer dispute or an improper sale or return. A retrieval request can lead to a chargeback. Return A transaction in which a consumer wants to return a purchase and receive his/her money back. RSA A method of public key encryption developed by Rivest, Shamir, and Adelman at the Massachusetts Institute of Technology which is sold by RSA Data Security Inc. RSA technology is one of the most popular public key encryption technologies currently available. Back to Top S Security Measures taken to keep something protected or safe from viewing, destruction, or manipulation. Secure Electronic Transaction (SET) A standard electronic transmission security format developed by Visa/MasterCard which uses a combination of encryption, digital signatures, certificates and third-party validation for secure credit card transactions over the Internet. Secure Socket Layer (SSL) A protocol first designed by Netscape Communications to enable encrypted, authenticated communications across the Internet. SSL is used mostly, but not exclusively, in communications between web browsers and web servers. URLs that begin with "https" indicate that an SSL connection will be used. SSL provides 3 important things: Privacy, Authentication, and Message Integrity. In an SSL connection each side of the connection must have a Security Certificate, which each side’s software sends to the other. Each side then encrypts what it sends using information from both its own and the other side’s Certificate, ensuring the authenticity of the message’s origin, that only the intended recipient can decrypt it, and that the data has not been tampered with. Security Certificate A chunk of information (often stored as a text file) that is used by the SSL protocol to establish a secure connection. A Security Certificate contains information about whom it belongs to, who it was issued by, a unique serial number or other unique identification, valid dates, and an encrypted "fingerprint" that can be used to verify the contents of the certificate. In order for an SSL connection to be created both sides must have a valid Security Certificate (also called a "Digital ID"). Server A computer or software program that provides services such as email and World-Wide Web access to clients on a network. Session In terms of the payment system, a session manages the exchange of money. SET See Secure Electronic Transaction. Settlement A process in which an electronic transaction (credit cards) is accepted for financial settlement between the acquiring and issuing banks. S-HTTP Secure HyperText Transfer Protocol A secure version of HTTP, developed by Netscape, which provides general transaction security services over the internet. SKU This is referred to as a stock keeping unit which is a specific number designating one specific product. Smart Card A credit-card sized tamper resistant plastic card that contains a microprocessor that can store and process data. Soft Goods Soft goods are products that can be distributed electronically. Examples of soft goods, also known as digital goods, include software, music files, images, or any other types of data that can be sent electronically from one computer to another. Software License A document that verifies a person has permission to use a software program. SSL See Secure Socket Layer. Swiped Card Credit card information that is electronically entered into a computerized system by swiping the credit card through a card reader or terminal. Back to Top T Tax Class Defines the type of taxes that are being applied i.e. G.S.T, VAT, Federal, State, or County tax. Tax Jurisdiction Defines a geographic area that has it’s own distinct set of tax rules and regulations i.e. a Country, a State, a City, a Municipal, or a County. TCP/IP Transmission Control Protocol/Internet Protocol A suite of computer communication protocols that connect networks and allows them to communicate with each other. TCP verifies data transmission between a client and a server. IP moves the data to the appropriate node on a network. TCP/IP is the primary transmission protocol used on the Internet. Terminal A device that enables you to communicate with a computer. Generally, a terminal is a combination of keyboard and display screen. Terminals are sometimes divided into three classes based on how much processing power they contain: Intelligent Terminal: a stand-alone device that contains main memory and a CPU Smart Terminal: contains some processing power, but not as much as an intelligent terminal Dumb Terminal: has no processing capabilities. It relies entirely on the computer’s processor Ticket Another name for the sales slip or its monetary value that results when a credit card purchase is made. Transaction The process that takes place when a cardholder makes a purchase with a credit card. Transaction Fee A per transaction amount charged by the bank for processing each transaction. This amount is in addition to the discount rate. For example: a discount rate of 2.25% plus 15 cents per transaction. Transaction Processor A financial institution distinct from the bank that processes data from credit card transactions. Providing pre-authorization, post-authorization, and refund services to businesses accepting credit cards. They are responsible for the distribution of funds between consumers and businesses. Most commonly referred to as a Payment Processor. Also known as Acquiring Processor. Back to Top U URL Uniform Resource Locator A method of identifying a document or resource on the Internet. A web page address. Back to Top V Visa An association of banks that govern the issuing and acquiring of Visa credit card transactions. Voice Authorization When a merchant makes a telephone call to obtain a credit card authorization rather than using a terminal, or credit card software to obtain the authorization. The merchant must, in addition to the voice authorization, submit the credit card information via telephone, terminal, or software to close out the transaction and transfer the funds to the their bank account. Void The act of canceling a purchase. There is only a small period of time in which a purchase can be canceled. Voids are typically handled by issuing credit to the consumer’s account. Back to Top W Web Browser Software that interprets the markup of files in HTML, formats them into web pages, and displays them to the user. Web Server A Web Server is a computer on the World Wide Web (connected to the Internet Backbone) that stores HTML documents that can be retrieved via a web browser. Back to Top X No Terms Defined. Back to Top Y No Terms Defined. Back to Top Z No Terms Defined.   Back to Top
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