Banking structures and other financial organizations in their activities often operate on terminology borrowed from the English language. Having the basic knowledge of this global medium of communication, you can understand some terms, for example, "prolongation (renewal) of an account", "debit payments" and others. But there are cases when literal translation can tell us little about the real significance of any operation. For example, acquiring - what does it mean? Consider the meaning of this concept.
The concept of "acquiring"
The activities of financial organizations in the provision of settlement, information and technological services using payment cards and equipment specially designed for these works are acquiring. What does this mean in a more understandable language?
Acquiring (translated from English as “acquiring” - acquisition) is an opportunity to pay for purchases in hypermarkets, communication services, and the like, through payment (credit) cards issued by banking institutions. In most Western countries, such a settlement policy has long existed and is widespread.
Types of Acquiring
There are two types of this activity:
- Trading acquiring. For the implementation of this process, POS-terminals are used, while physically there is a card, which is used to write off funds, and also the owner’s signature is placed on the check.
- Internet acquiring represents similar cash transactions carried out by a special organization called the Processing Center. At the same time, the payment card is not physically present, and the signature is not identified here.
Highlights
Paying for services and goods in a non-cash way is very convenient, which explains the widespread use of such a process as acquiring (which this means has already been discussed above). This process is carried out online as follows: the buyer enters the data (initials, card number, bank name, etc.) into a special form on the website of the online store and finally confirms the payment.
At the same time, the online process can take place in several ways:
- Payments are received to the account of the online store itself. However, this method is now considered irrelevant due to the high percentage of risks;
- payments are made through electronic money systems;
- acquiring operations are carried out using payment cards of electronic systems with a partial transfer of risks to these organizations.
It can also be noted that if the services do not meet the proper level or the quality of the purchased goods is poor, 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 imposed a system of fines on sellers of services or goods. The admissible failure rate for the VISA card system is 2%, and for MasterCard - no more than 1%.
This service can be connected by both banks and payment processors, while it can be noted that the tariff rates and conditions of these two financial organizations are practically the same.
Payments for utilities, payment for mobile communications, money transfer - this is an incomplete list of opportunities that acquiring provides. What this means for each person can be understood without explanation - getting rid of queues, making a purchase at any time of the day, and so on. We can say that this procedure is one of the components of a developed society in economic and technical terms.