Marcel van Oost’s Post

An Introduction to Cards in Payments Edition 2: 𝐓𝐡𝐞 𝐊𝐞𝐲 𝐏𝐥𝐚𝐲𝐞𝐫𝐬 𝐢𝐧 𝐏𝐚𝐲𝐦𝐞𝐧𝐭𝐬 Behind every card transaction there is a coordinated set of players: Each with a unique role. 𝐈𝐬𝐬𝐮𝐞𝐫𝐬: Issuers are banks or financial institutions that provide cards directly to consumers. ► Key Functions: → Underwrite and approve new cardholders → Furnish credit, debit, or prepaid cards → Authorize and clear transactions in real-time ► How They Make Money: From interchange fees, annual card fees, interest on revolving credit, and FX markups. ► Examples: Citi, UBS, ING, TD, Deutsche Bank, Chase 𝐀𝐜𝐪𝐮𝐢𝐫𝐞𝐫𝐬 Acquirers are responsible for enabling businesses to accept card payments. ► Key Functions: → Set up and manage merchant accounts → Process card transactions and settle funds to merchants → Manage chargebacks and fraud risk ► How They Make Money: Through processing fees, gateway charges, and often value-added services (fraud protection, analytics) ► Examples: Checkout.com, Worldpay, Nuvei 𝐂𝐚𝐫𝐝 𝐍𝐞𝐭𝐰𝐨𝐫𝐤𝐬 Card networks serve as the central infrastructure layer between issuers and acquirers. ► Key Functions: → Route transaction requests between issuer and acquirer → Establish dispute resolution protocols → Set interchange and assessment fees → Manage card branding and acceptance standards ► How They Make Money: Card networks earn scheme fees, cross-border fees, and fraud assessment charges ► Examples: Visa, Mastercard, American Express, GIE Cartes Bancaires 𝐏𝐚𝐲𝐦𝐞𝐧𝐭 𝐆𝐚𝐭𝐞𝐰𝐚𝐲𝐬 Gateways act as the secure portal through which card data travels from the consumer to the acquiring bank. ► Key Functions: → Route transactions to the appropriate processor → Offer tools for fraud prevention, 3DS, and retry logic → Provide dashboard and reconciliation interfaces to merchants 𝐍𝐨𝐭𝐞: The tokenization process may be performed by 3rd Party vault VGS, Acquirer Checkout.com, Gateway DEUNA, and Merchant... ► How They Make Money: Gateways charge monthly platform fees, per-transaction fees, and revenue-sharing arrangements ► Examples: DEUNA, CellPoint Digital, Amadeus 𝐏𝐚𝐲𝐦𝐞𝐧𝐭 𝐀𝐠𝐠𝐫𝐞𝐠𝐚𝐭𝐨𝐫𝐬 Aggregators combine payment services into a single offering, especially for smaller merchants ► Key Functions: → Act as Merchant of Record (MoR), processing under their own MID → Aggregate transactions across merchants → Handle onboarding, settlement, and risk management ► How They Make Money: Profit from higher per-transaction fees and managing float ► Examples: Paddle, Stripe, PayU, BillDesk — ► Check out Edition 1: The Types of Cards: https://bit.ly/4jx072E ► Check out Edition 3: The Payment Method Guide: https://bit.ly/3YMB6bk — Source: Travel & Payments, and a BIG thanks to my mate Arthur Bedel for writing this amazing piece 👌 Find this helpful? [ 𝗿𝗲𝗽𝗼𝘀𝘁 ] Anything to add about this subject? [𝗶𝗻𝘃𝗶𝘁𝗲𝗱 𝘁𝗼 𝗰𝗼𝗺𝗺𝗲𝗻𝘁] Nice story, Marcel. Next! [ 𝗹𝗶𝗸𝗲 ]