Financial terminology: acquiring - what is it?

Banking structures and other financial organizations often operate with terminology borrowed from the English language. Having basic knowledge of this world communication tool, you can understand some terms, for example, "prolongation of account", "debit payments" and others. But there are cases when a literal translation can not say much about the actual meaning of an operation. For example, acquiring - what does this mean? Consider the meaning of this concept.

The concept of acquiring

The activities of financial organizations for the provision of settlement, information and technological services using payment cards and equipment specially designed for this work are acquiring. What does this mean in a more accessible language?

Acquiring (in English translation "acquiring" - acquisition) is an opportunity to pay for purchases in hypermarkets, communication services and the like, through credit cards issued by banking institutions. In most Western countries, such a calculation policy has long existed and is prevalent everywhere.

Types of acquiring

There are two types of this activity:

1. Trading acquiring. To implement this process, POS-terminals are used, at the same time there is physically a card on account of which the funds are written off, and also the signature of the owner on the check.
2. Internet acquiring presents similar cash transactions carried out by a special organization called the Processing Center. In this case, the payment card is not physically present, and the signature is not identified here.

Basic moments

Paying for services and goods in a non-cash way is very convenient, which explains the wide distribution of such a process as acquiring (which means it has already been discussed above). This online process is carried out as follows: the buyer enters the data (initials, card number, bank name and so on) into a special form on the website of the online store and at the end confirms the payment.

In this case, the online process can take place in several ways:

• Payments come to the account of the online store itself. However, this method is considered to be irrelevant today because of the high percentage of risks;
• Payments are made through electronic money systems;
• Acquiring operations take place using payment cards of electronic systems with a partial transfer of risks to these organizations.

It can also be noted that in case of non-conformity of services to the proper level or poor quality of the purchased goods, the buyer can claim his money back within 180 days. The cancellation procedure is called Chargeback, and to minimize the occurrence of such cases, card regulators have imposed a system of penalties on the sellers of services or goods. The level of allowable failures for the VISA card system is 2%, and for MasterCard - no more than 1%.

The connection of this service can be carried out by both banks and payment processing, while it can be noted that the tariff rates and terms of these two financial organizations are practically the same.

Calculations for utilities, mobile payment, transfer of funds - this is an incomplete list of opportunities that provides acquiring. What this means for each person can be understood without explanation - getting rid of queues, making purchases at any time of the day and so on. It can be said that this procedure is one of the components of a developed society economically and technically.