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If you’re new to the fascinating world of B2B Prepaid, you may get lost and confused with all the terminology. I’m here to help. I’ve identified many terms that you will come across and need to understand as you make decisions on how to run your program. I’ve listed them in alphabetical order for your convenience.
Acquirer – A bank or processor that sponsors merchants for the acceptance of credit and debit card transactions.
Breakage – The unused portion of funds on a prepaid debit card at the date of expiration.
Closed Loop – Store cards or gift cards that can only be used at a single merchant or single merchant group (such as Starbucks).
Custom Card – Cards that are customized to a given companies logo, look, feel, brand or messaging.
Embossing – The raised lettering and numbering found on most debit, prepaid and credit cards.
Faux Card – A card where the front is a printed picture of the actual debit card and with generic information. The back of the card is blank with no issuing language.
Generic Embossing – Cards that are embossed with generic verbiage such as “Thank You” instead of the cardholders name. These cards are great to keep on hand for “On The Spot Rewards” to employees or customers.
Interchange – A fee paid by the merchant to the issuer in POS (Point Of Sale) transactions. This is a source of revenue for the issuing bank and/or the processor.
Merchant Category Code (MCC) – A code assigned by an Acquirer to a Merchant to identify the merchant’s principal trade, profession or line of business. This four digit code is also known as the SIC CODE.
Open Loop – Open loop or branded cards are debit, prepaid or credit cards that can be used on the “open” networks of MasterCard, Visa, Discover and American Express. The term Open is used because they can be used at a variety of merchants as opposed to Closed Loop gift or store cards.
Payroll Card – A prepaid debit card issued by an employer to their employees who don’t have a banking relationship or participate in direct deposit.
PCI – Payment Card Industry
PCI Compliance – A set of comprehensive requirements for enhancing payment account data security. This standard is intended to help organizations proactively protect customer account data.
Prepaid – Also known as stored value. Cards are pre-funded with a set dollar amount and can be either single value or reloadable.
Private Label – A card program that allows prepaid cards to be restricted in their use to a single merchant or group of merchants. They do not have the MasterCard or Visa logo on them, but it rides on their network. These cards are not embossed. The cards will only work at defined locations.
Reloadable – A card that can have additional money added or “loaded” electronically.
Replica Card – A card where the front is a printed picture of the actual debit card and with generic information. The back of the card has standard verbiage and a unique number to identify the card.
Selective Authorization – The capability to restrict where a card can be used or specifically steer clients to a single merchant, merchant category or group of merchants.
Single Value – A card that has a one-time, fixed amount of money. The card can be used until funds are depleted or until the card expires.
Slippage – The money that is still on cards that are issued but not activated for use prior to the expiration date.
Transaction – An action between a cardholder and a merchant that results in activity on a cardholder account.