Reference
Payments Glossary
Plain-language definitions of authentication, settlement, risk, card, and compliance terms — written and reviewed by payments specialists at Adaptiv. Use search or the A–Z index to find a term.
5 definitions · Updated regularly
- 3D Secure Payment Gateway
3D Secure is a risk-based authentication protocol used for card-not-present payments, such as online transactions. A 3D Secure payment gateway incorporates this technology and initiates the authentication process for high-risk transactions, ensuring the purchase is legitimate.
- AVS Mismatch
An AVS (Address Verification System) mismatch occurs when the billing address a customer enters during a card transaction doesn't match the address on file with the card-issuing bank. This can trigger fraud flags and increase transaction fees, or cause declines, depending on the merchant's processor settings and risk thresholds.
- Merchant Account
A merchant account is a commercial account at an acquiring bank that lets a business accept credit and debit card payments and receive the resulting settlement funds.
- Pre-Authorized Payment
A pre-authorized payment is a type of hold that checks if the card number is valid and if the customer's account has sufficient funds. However, this pre-authorization does not settle the charge or transfer funds. Merchants may use this for a number of reasons, including delayed fulfillment of the product, varying final costs, or a service deposit.
- Void Transactions
Void transactions mean that a pending transaction is canceled before any funds are moved from the customer's account. A void transaction is different from a refund or chargeback because it happens in the pre-settlement phase, before the customer's bank or card issuer has transferred any funds.