Fintech Words: The Payments Glossary You Actually Wanted

Oct 10

5 min read

Ever sat in a partnership call, nodding along while someone says "we'll sort it on the issuer side, IC++ pricing, network tokens from day one"? You're not alone. Payments speaks its own language, and most of it is three letters long.

Consider this your phrasebook. Every term you'll hear in the room, decoded in one line, so next time you're the one doing the explaining.

The players: who's who in a card payment

A single tap of a card touches five or six companies. These are their names.

Term	What it means
Issuer	The bank or fintech that gives the customer the card (Monzo, Barclays, Revolut). It approves or declines your spend.
Acquirer	The bank or licensed firm that lets a merchant accept cards and receives the money on their behalf.
Card scheme / network	The rulebook and rails connecting issuers and acquirers: Visa, Mastercard, Amex, UnionPay, Discover, JCB.
PSP (Payment Service Provider)	The company a merchant signs up with to take payments: Stripe, Adyen, Checkout.com, Teya, SumUp. Often an acquirer too.
Payment facilitator (PayFac)	A PSP that onboards lots of small merchants under its own master account, so each one doesn't need its own acquiring contract.
Processor	The tech that moves the transaction messages around. Issuer processors (Marqeta, Thredd, Paymentology) run the card side; acquirer processors run the merchant side.
BIN sponsor	A licensed bank or EMI that lends a fintech its scheme membership so the fintech can issue cards.
Programme manager	The fintech that designs and runs a card programme day to day, sitting on top of a BIN sponsor and a processor.
EMI (E-Money Institution)	A UK/EU licence to hold customer money and issue e-money. Lighter than a banking licence: no lending, no FSCS protection.
Card bureau	The factory that physically makes, personalises and posts cards.

The money flow: what happens after the tap

Term	What it means
Authorisation	The real-time "yes or no" from the issuer. Takes about two seconds. No money moves yet.
Clearing	The batch step where the transaction details are confirmed and amounts are calculated.
Settlement	The actual movement of money: issuer pays the scheme, scheme pays the acquirer, acquirer pays the merchant. Usually T+1 or T+2.
Interchange	The fee the acquirer pays the issuer on every transaction. Capped in the UK and EU at 0.2% for consumer debit and 0.3% for consumer credit.
Scheme fees	What Visa and Mastercard charge both sides for using the network. Not capped, and rising.
MSC (Merchant Service Charge)	The all-in price a merchant pays: interchange + scheme fees + the acquirer's margin.
Blended vs IC++	Blended = one flat rate. Interchange++ = each cost passed through separately. Big merchants prefer IC++.
Chargeback	A forced refund the customer triggers through their issuer ("I never received it"). The merchant pays, plus a fee.
MCC (Merchant Category Code)	A four-digit code describing what a business sells. Drives fees, rewards and risk rules.
Float	Customer money sitting with a provider before it's paid out. Earns interest for whoever holds it.

The card itself

Term	What it means
PAN	Primary Account Number: the long number on the card.
BIN / IIN	The first 6-8 digits of the PAN. They identify the issuer and card type.
EMV	The chip standard (Europay, Mastercard, Visa) that made card cloning much harder.
Card-present vs card-not-present (CNP)	In-store vs online. CNP is where most fraud now happens.
Tokenisation	Swapping the real card number for a stand-in. Network tokens (from Visa/Mastercard) also update automatically when a card expires.
3DS2 / SCA	The "approve in your banking app" step. Strong Customer Authentication is the UK/EU law; 3-D Secure 2 is how cards meet it.
Virtual card	A card that exists only as data, often single-use. Big in B2B and travel.
SoftPOS / Tap to Pay	Turning a normal phone into a card terminal. No extra hardware needed.
PCI DSS	The security standard anyone touching card data must meet. Version 4.0.1 is now the one in force.
HSM (Hardware Security Module)	A tamper-proof box that stores the cryptographic keys behind PINs and chips.

Account-to-account (A2A): payments without cards

Term	What it means
Open banking	Rules that let regulated apps read your account data (AISP) or start payments from it (PISP), with your consent.
Pay by bank	Checking out by approving a transfer in your banking app instead of typing card details. Built on open banking.
VRP (Variable Recurring Payments)	A standing permission for an app to pull varying amounts from your account, within limits you set. The A2A answer to direct debit.
Faster Payments	The UK's instant payment rail. Up to £1m per payment, 24/7.
Bacs	UK batch payments: salaries and Direct Debits. Takes three working days.
CHAPS	UK same-day high-value payments, run by the Bank of England. House purchases live here.
SEPA / SEPA Instant	The euro area's shared payment rails. Instant transfers are now mandatory for euro banks to offer.
RTP (Real-Time Payments)	The generic name for instant rails: Pix (Brazil), UPI (India), FedNow (US).
ISO 20022	The new global messaging standard for payments. Richer data per transaction, now live on CHAPS and SWIFT.

The buzzwords you'll hear in 2026

Term	What it means
APM (Alternative Payment Method)	Anything that isn't a card: wallets, BNPL, bank transfers, QR codes.
Digital wallet	Apple Pay and Google Pay (which tokenise your card) or stored-value wallets like Alipay and M-Pesa (which hold the money themselves).
BNPL	Buy Now, Pay Later: Klarna, Clearpay, PayPal Pay in 3. Coming under FCA regulation in the UK from 2026.
Embedded finance	Financial products built into non-financial apps: a loan inside Shopify, a card inside Uber.
BaaS (Banking-as-a-Service)	A licensed bank renting out its licence and infrastructure through APIs so others can launch accounts and cards.
Payment orchestration	A layer that routes each payment to the best PSP for cost, approval rate or uptime.
MoR (Merchant of Record)	The legal seller on a transaction, responsible for tax, refunds and compliance. Paddle and Lemon Squeezy are MoRs for software firms.
Stablecoin	A crypto token pegged to a currency, usually the US dollar (USDC, USDT). Increasingly used for cross-border settlement.
Agentic commerce	AI agents shopping and paying on your behalf. Visa (Intelligent Commerce) and Mastercard (Agent Pay) are building the rails.
KYC / KYB / AML	Know Your Customer, Know Your Business, Anti-Money Laundering: the checks every regulated firm must run.

One sentence to remember: the issuer serves the cardholder, the acquirer serves the merchant, and the scheme sets the rules between them. Everything else is plumbing.