Cards and Payment Domain

 There are three main types of cards, credit card, debit card and prepaid card. 1.Credit Card The banks and a couple of non-banks (or NBFCs) generally issue such cards along with networks(Mastercard, Visa, Amex).  The card issuer creates a account and grants a line of credit to the cardholder, from which the cardholder can borrow money for payment to a merchant or as a cash advance.  There are two credit card groups: consumer credit cards and business credit cards. Most cards are plastic, but some are metal cards (stainless steel, gold, palladium, titanium). There are also co-branded credit cards that are issued by bank for a particular partner company like Flipkart Axis, Amazon ICICI Pay etc. Following are few feature of Credit Card Credit Limit:  Customer get credit limit which depend on their salary, profession, company Spending Rule: Allow the cardholder to spend up to a specified credit limit Credit Period: Offer   cardholder an interest fee period, allow card holder to repay at l

 Off Us Transaction Payment System take input from bank B and route to bank A, that is taking transaction from acquirer and route to issuer. The card is belongs to issuer still transaction being done at acquirer side this called off us transaction. On Us Transaction When acquirer and issuer bank are same and they  don't need payment system to route there own transaction this called on us transaction.   

What are Acquiring Banks? An acquiring bank is a bank or financial institution that processes credit or debit card payments on behalf of a merchant.  An acquiring bank serves a merchant by “acquiring” funds from cardholder banks when payment card transactions are processed. What are Issuing Banks? Issuing banks on the other hand is bank who issued the card. They issue payment cards to authorized consumers. In above image Bank  B  provided  Account and POS machine to the merchant which accepting payment from Cardholder hence bank B is Acquire  Bank Bank  A    Providing money to the Merchant  on behalf of Cardholder Hence  Bank  A  is Issuer Bank Merchant is a customer of Acquirer bank Customer who uses card is a customer of Issuer bank

A Payment gateway is a technology allow merchant to accept cards payment from customer for their purchase.  Any business accepting electronic payment using cards need payment gateway to process the transactions. In simpler word a payment gateway is a network through customer can transfer funds from their account to merchant account.  How Payments Gateway works Let assume customer having A bank credit card, When customer swipe or insert card on POS machine, the transaction reach to bank B Using IIN it decided which payment scheme provided the card (like if card start with 4 it provided by visa) and transaction rout to the corresponding payment system Using Issuer BIN payment system decided which bank issued the card What is BIN? The abbreviation of BIN is bank identification number A bank identification number(bin) is the first six numbers that appear on credit card Example