Frequently Asked Questions

The Payments Industry Terms You Need to Know :

  • Card Processing 101
  • Merchant Account
  • Payment Gateway
  • POS Terminal
  • POS Software
  • Mobile Payments
Card Processing 101 - Key Players

Processing credit cards is not complex once you understand the basic industry terms. Below is a list of the key players in merchant card processing.


If you have a credit or debit card (as most of us do), you're already pretty familiar with the role of the cardholder. A cardholder is someone who obtains a bankcard (credit or debit) from a card issuing bank. The cardholder presents their credit/debit card to a merchant as payment for goods or services.


A merchant is any business engaged in the sale of goods or services. A merchant is required to obtain a merchant account in order to accept a cardholder's credit/debit card as payment.

Acquiring Bank (Merchant Bank)

An acquiring bank is a registered member of the card associations (Visa and MasterCard). An acquiring bank is often referred to as a merchant bank because they contract with merchants to create and maintain accounts that allow the business to accept credit and debit cards, (i.e. merchant accounts). Acquiring banks provide merchants with equipment and software to accept cards, promotional materials, customer service and other necessary aspects involved in card acceptance. The acquiring bank also deposits funds from credit card sales into a merchant's account.

Interestingly enough, many merchants don't recognize their acquiring bank as the primary provider of their merchant account. Acquiring banks are playing an increasingly hands-off role as the bankcard system evolves. Acquiring banks often enlist the help of third-party independent sales organizations (ISO) and membership service providers (MSP), like SaleManager, to conduct and monitor the day-to-day activities of their merchant accounts.

Issuing Bank (Cardholder Bank)

An issuing bank issues credit cards to consumers. The issuing bank is also a member of the card associations (Visa and MasterCard). Issuing banks pay acquiring banks for purchases that their cardholders make. It is then the cardholder's responsibility to repay their issuing bank under the terms of their credit card agreement.

How credit card processing works

9 Steps to Credit Card Processing

How Credit Card Processing Works
what is a Merchant Account?

A merchant account is a type of bank account that allows businesses to accept payments by credit/debit cards. A merchant account is established under an agreement between a processor and a merchant acquiring bank for the settlement of payment card transactions. In some cases a payment processor, independent sales organization (ISO), or member service provider (MSP) is also a party to the merchant agreement. Whether a merchant enters into a merchant agreement directly with an acquiring bank or through an aggregator, the agreement contractually binds the merchant to obey the operating regulations established by the card associations (Visa/MasterCard). The major benefit of a merchant account is that the name of the merchant (business) will appear on the cardholder's credit card statement.

How do I obtain a merchant account?

A merchant (business) can obatin a merchant account from a processor/acquiring bank by applying directly with a independent sales organization (ISO), or member service provider (MSP), like SaleManager. In order to apply for a merchant account, the merchant must complete and sign a merchant service agreement and provide other requested support documentation. Once approved, the merchant account will be configured with the merchant's Point of Sale (POS) solution to enable cardholder payments.

what currencies can I accept?

A merchant account will settle in a single currency. The settlement currency is selected during the application process. Some POS solutions provide a DCC (Dynamic Currency Conversion) feature but we encourage our merchants to obtain a merchant account for each required settlement currency. SaleManager processors can provide a merchant account with settlement in the following currencies -- USD, CAD, GBP & EUR.

can a high risk business obtain a merchant account?

Yes, SaleManager has a special program for high risk businesses. The application process for a high risk business takes 4-6 weeks to obtain an approval from the processor. During the application process, the processor may request additional documentation. A merchant is strongly encouraged to respond in a timely manner.

What is a Payment Gateway?

A payment gateway is an online service that authorizes credit/debit card payments for e-businesses, online retailers, bricks and clicks, or traditional brick and mortar.

how do i get a payment gateway?

A merchant can request a payment gateway service, like Planetauthorize, during the merchant account application process. However, if you already have a merchant account you can go directly to the payment gateway to obtain an account.

can I use a payment gateway for my retail and online store?

Yes, merchants can use the Planetauthorize payment gateway to process their retail (swipe) transactions and their online (keyed) transactions. Sales reporting is consolidated on a single platform when you use your payment gateway service to process cardholder transactions from multiple channels (e.g. retail, online, mobile).

Merchants can accept customer orders on their online webstore and have the customer's sales receipt available for fulfillment in their retail store or restaurant.

which payment gateway does salemanager offer?

SaleManager offers the Top 4 rated payment gateways -- Planetauthorize, Authorize.Net, PlugnPay, Skipjack.

Can I load multiple merchant accounts in a single payment gateway account?

Yes, Planetauthorize allows merchants to load multiple merchant accounts in a single gateway account. Merchant can select the merchant account and currency when processing a transaction. This feature is available from the virtual terminal and integration API.

Can I use a shopping cart with my payment gateway?

Yes, your customers will "add to cart" then "check out" and send the transaction(s) to your payment gateway for processing. Most shopping carts support multiple payment gateways. Your SaleManager can discuss shopping carts options with you.

what is a POS Terminal?

POS (Point of Sale) Terminals are compact computers that have integrated touchscreens specifically designed for POS applications. Their compact design helps save counter space and many models offer sealed and fanless versions to handle any environment. POS Terminals require a telephone LAN line or a Internet connection in order to process credit/debit card transactions.

Point of sale terminals are a combination of software and hardware that allows retail locations to accept card payments without updating their cash registers to read cards directly. The costs of installing POS terminals vary with the size of the business and the terms from the supplier. Small merchants may have to pay rent for the terminal, as well as pay an additional per-transaction fee.

The Trend is to update POS Terminals to models supporting EMV and NFC.

EMV® is a global standard for credit and debit payment cards based on chip card technology" taking its name from the card schemes Europay, MasterCard, and Visa - the original card schemes that developed it.

Near field communication (NFC) is the set of protocols that enable electronic devices to establish radio communication with each other by touching the devices together, or bringing them into proximity to a distance of typically 10cm or less. Examples of NFC are ApplePay and Android Pay.

Does SaleManager offer a free terminal program?

Yes, SaleManager does offer a free POS Terminal program. Our free terminals are EMV/NFC ready.

what is POS Software?

POS software is what brick and mortar retailers use to conduct sales. It's sometimes a cash register, computer, or even an iPad or Android tablet where cashiers input your products, tally the cost, and conduct the financial transaction. Most POS software will also communicate with inventory levels to keep everything in balance.

Do I need a merchant account to use POS Software?

Merchants will require a merchant account in order to process credit cards electronically.

Does SaleManager have a solution for taking orders online and fulfilling at the merchant's location?

Yes, the merchant can use Planetauthorize payment gateway to process online and retail transactions. Consolidated sales reporting can help with the merchant's fulfillment process.

Can I use open source software?

Yes, merchants can use open source software. However, merchants should use POS Software that includes encrypted card readers and is PCI Compliant.

Which POS software does Salemanager recommend?

SaleManager recommends unicenta POS and Planetauthorize.Net for use in retail stores. unicenta is available as a free download. Planetauthorize.Net is available directly from SaleManager. Both platforms support encrypted card readers.

Mobile Payment Processing

Mobile payment processing provides merchants with the ability to accept credit cards payments using their mobile phone or tablet. Mobile payment applications are available in the respective online stores (e.g. iTunes, Google Play, Microsoft Store).

Do mobile payment apps use an encrypted card reader?

Not all mobile payments applications use an encrypted card reader. Due to security risks, merchants should not use a mobile payment application to process swipe transactions without an encrypted card reader.

Can I process swipe and keyed transactions?

Yes, mobile payment applications allow merchants to process both swipe and keyed transactions. However, merchants will pay a higher rate for keyed transactions.

Which mobile platforms are supported?

SaleManager's mobile payment application, Mobileauthorize™, supports iOS, Android and Windows Phone.