Payment Terms Glossary

Regulated banks that process payments for merchants. When a consumer submits their payment card details, an acquiring bank initiates a request to authorise the payment. It goes to the consumer’s bank (“Issuing Bank”) via the Card Scheme networks. When the transaction is authorised, the acquiring bank retrieves the funds. Acquirers must be licensed by local financial regulators and Card Schemes.

The anti-money laundering and counter financing of terrorism (AML CFT) Division within the Prudential Authority was established in April 2012 and is responsible for supervising and enforcing compliance with the FIC Act. These directives principally exist to combat illicit financial activities, including disguising funds as legitimate transactions.

Card Schemes are the brand of the customer’s card (e.g. Visa, Mastercard, American Express) that set the rules and provide the infrastructure for card payments. They function as the central payment network that facilitates the transmission of payment instructions, including operations and clearing. Acquiring banks and payment processors must adhere to the Scheme Rules for processing card payments, unless local regulation contradicts a specific Scheme Rule.

A Global Payments Processor / Orchestrator nominated by International Merchants to facilitate payments and remittances. These Collection Agents are licensed aggregators of payments (similar to the concept of a TPPP) to process payments on behalf of International Merchants and manage settlement of funds. The scope of their compliance is typically limited to payment processing compliance (e.g. PCI DSS compliance). They do not take on responsibility or liability for any local compliance, tax management, or selling of goods.

Licensed non-bank payment processor or facilitator that facilitates the transmission of payment information between the customer, the merchant, the card network, and their respective banks. In some cases, these entities function strictly as a technical service layer that integrates with licensed payment processors or TPPPs in their respective markets.

The customer’s bank, i.e. the bank with whom the customer engages and who issued their account and card.

A legal entity that offers financial distribution to companies in markets where they are not physically present. A Merchant of Record processes payments using local payment options and takes on the liability related to transactions (e.g. chargeback management, dispute management, selling of goods and services). It arranges all due tax payment and ensures compliance both with local regulation and online payment processing rules.

A registered non-bank payment processor or facilitator that facilitates the transmission of payment information between the customer, the merchant, the card network, and their respective banks. SOs are authorised in terms of the SARB Directive 2 of 2007 by PASA on behalf of the SARB.

A registered non-bank payment processor or facilitator that facilitates the transmission of payment information between the customer, the merchant, the card network, and their respective banks. A TPPP is typically enabled by a SO and may hold funds for payment due in its own bank account for a limited period of time. A SO only provides the technology but does not accept the funds into its own bank account for on-payment to another party.