payments

Card Processing

Acquiring, issuing, BIN sponsorship, and network routing

Card Processing — Overview

Acquiring, issuing, BIN sponsorship, and network routing

Card processing covers issuing (bank creates cards), acquiring (merchant acceptance), and network routing (Visa, Mastercard, RuPay). Processors handle authorization, clearing files, interchange calculation, and merchant onboarding (MID, MCC, descriptor).

// Card processing pipeline
[Merchant POS] → [Acquirer] → [Card Network] → [Issuer]
                      ↓
              [Processor / PayFac]
                      ↓
              [Settlement + Interchange]

// Interchange example (simplified)
// Visa CPS Retail: ~1.51% + $0.10 (US)
// MCC affects rate — 5732 Electronics vs 5812 Restaurants

// Issuer authorization decision chain
1. Card status (active, blocked, expired)
2. Available balance / credit limit
3. Fraud score
4. 3DS result
5. Return DE39 response code

Tip: PayFac model aggregates sub-merchants under one MID — faster onboarding but consolidated chargeback risk.