What is an acquiring bank?¶

An acquiring bank is the financial institution that supports a merchant in accepting card payments.

Avoid this assumption: The acquiring bank is the same institution that issued the customer’s card.

The card issuer provides the card to the customer. The acquiring bank supports the merchant side of the transaction.

Between them may sit a payment processor, gateway, card network or payment facilitator.

The acquiring bank or its processor may hold records about the merchant account, terminal, transaction routing, settlement, chargebacks and refunds.

These records can help identify the legal merchant behind an unfamiliar descriptor or marketplace payment.

Relevant identifiers may include merchant ID, terminal ID, acquiring reference, transaction reference, authorisation code and settlement record.

The acquiring bank does not automatically know who physically operated the merchant terminal or website account. It may also rely on a payment facilitator that manages several underlying sellers.

It may hold the merchant relationship, while the merchant holds order, staff, CCTV and customer records.

Preserve the merchant descriptor, category code, terminal details, amount, timestamp and transaction reference.

Ask the issuer or processor to identify the acquiring institution where it is not obvious.

Then obtain the acquiring or merchant records relevant to the payment.

Do not assume that money settled directly from the cardholder to the merchant. Card payments usually involve several system stages and institutions.

When reporting, distinguish the issuing bank, acquiring bank, processor and merchant.

Operational takeaway¶

Use acquiring-bank and processor records to identify the merchant account, terminal and settlement route, while obtaining separate evidence about the actual seller and operator.