Payment Terms Glossary
Payment pricing is full of acronyms that hide real costs. Filter by topic or search below to see plain-English definitions for every term used across Sympli5's fee tables, calculators, and regional guides.
Acquirer / Acquiring Bank
The licensed bank or financial institution that underwrites your merchant account, processes card transactions on Visa/Mastercard rails, and settles funds into your bank account. In the Caribbean and Latin America, banks like NCB Jamaica, Scotiabank, CIBC Caribbean, Republic Bank, BAC Credomatic, and Getnet Santander act as direct acquirers.
A2A (Account-to-Account)
Payments that move money directly from the customer's bank account to the merchant's bank account without traversing Visa or Mastercard rails. Examples include Pix in Brazil, UPI in India, SEPA Instant / iDEAL in Europe, Ozow / PayShap in South Africa, and Sentoo in the Dutch Caribbean.
Blended / Flat-Rate Pricing
A pricing model where the payment processor charges a single fixed percentage plus a flat fee (such as 2.9% + $0.30 on Stripe or Square) regardless of whether the buyer uses a regulated debit card or a corporate rewards credit card. Predictable for startups, though often costlier at scale than interchange-plus.
BNPL (Buy Now, Pay Later)
Installment providers—such as Tabby and Tamara in the Gulf (Middle East guide) or Klarna in Europe/US—where the shopper pays in 3 or 4 interest-free slices while the merchant receives the full payout upfront minus a contract-negotiated merchant discount rate (typically 4%–7%).
CBDC (Central Bank Digital Currency)
Digital legal tender issued directly by a central bank. The Caribbean leads global retail CBDC adoption with the Bahamas Sand Dollar (accepted via Kanoo Pays and SunCash on BSD) and Jamaica's JAM-DEX (accepted via Lynk on JMD).
Chargeback & Dispute Fee
A forced payment reversal initiated by the cardholder's issuing bank. Beyond losing the transaction value, processors charge a separate non-refundable dispute fee (typically $15–$25 USD equivalent). Per-transaction calculators exclude chargeback fees by design.
Cross-Border / International Card Surcharge
An extra percentage fee added when a customer pays with a card issued outside the merchant's domestic country or region. For example, Stripe adds +0.8% in Canada versus +1.5% in the United States. You can toggle International card in our Fee Calculator to model this surcharge.
Cybersource & Powertranz
The two dominant technical payment gateways used by commercial banks across the Caribbean and Central America. Neither onboards small merchants standalone to settle funds; instead, you obtain a Merchant ID (MID) from an acquiring bank (NCB, Scotiabank, CIBC, Republic Bank, RBC, or BAC) which provisions your Cybersource or Powertranz gateway credentials.
Effective Rate
Total processing fees divided by the gross transaction amount, expressed as a percentage. Because of fixed per-transaction fees, a 2.9% + $0.30 gateway rate costs 12.9% effective on a $3.00 purchase, 3.02% effective on a $250 purchase, and 2.93% effective on a $1,000 purchase.
Fee Cap
A maximum ceiling on the total fee charged for a single transaction. For example, in Nigeria, Paystack, Flutterwave, and Monnify cap local fees at ₦2,000 (and Squad caps at ₦1,500); in Europe, GoCardless caps SEPA Direct Debit fees at €4.00. Our calculators apply published fee caps automatically.
Fixed Fee
The flat currency amount charged on every transaction regardless of order size (e.g., $0.30, €0.25, or J$15). Fixed fees disproportionately impact micro-transactions and low-ticket retail.
FX Conversion Spread
The 1%–3% currency conversion fee charged by a gateway or bank when the customer pays in one currency (e.g., USD or EUR) and the merchant settles into a different currency (e.g., CAD, JMD, or GBP).
Gateway (Payment Gateway)
The software and API layer that securely encrypts card/payment details at checkout, runs 3D Secure authentication, and routes the authorization request to the acquiring bank or payment network.
GCT (General Consumption Tax)
Jamaica's 15% value-added tax. On JMD transactions processed through WiPay, a 15% tax applies to the percentage processing fee itself (turning a 4.2% base rate into 4.83% effective).
GST (Goods and Services Tax)
Consumption tax applied on top of gateway commissions in markets like India (18% GST on Razorpay, Cashfree, and PayU fees) and Australia / New Zealand.
Interchange
The wholesale fee set by Visa and Mastercard and paid by the merchant's acquiring bank to the cardholder's issuing bank. In the European Economic Area (Europe guide), EU regulations cap consumer debit interchange at 0.2% and credit at 0.3%, which is why European card rates (~1.5%) are roughly half of US card rates (~2.9%).
Interchange-Plus (IC+) Pricing
A transparent pricing model where the processor passes through the exact wholesale card interchange + network assessment fee at cost and adds a small fixed markup (for example, Helcim at interchange + 0.50% + $0.25 online, or enterprise contracts with Adyen and Checkout.com).
IVA (Impuesto al Valor Agregado)
Value-added tax across Latin America. In Mexico, all published gateway fees (Conekta, Mercado Pago, Stripe, Clip, PayU) exclude 16% IVA charged on the fee itself.
mada / KNET / Benefit / NAPS
National domestic debit card switches in the Gulf (Middle East guide): mada in Saudi Arabia (~1.75% merchant fee vs ~2.75% on credit cards), KNET in Kuwait (1%–1.5%), Benefit in Bahrain (~1.5%), and NAPS in Qatar.
MDR (Merchant Discount Rate)
The percentage commission charged to a merchant for accepting a specific payment method (cards, QR, or mobile money).
MID (Merchant Identification Number)
A dedicated merchant account issued by an acquiring bank after underwriting your business. A direct bank MID gives you lower per-transaction rates (~2.25%–3.5%) and direct bank settlement, whereas a Payment Facilitator (PayFac) lets you process under a shared master MID without bank underwriting.
Mobile Money
Telecom-led digital wallets that store value tied to a mobile phone number rather than a traditional bank account—led by M-Pesa (KES, TZS), MTN MoMo (GHS, UGX, RWF), Wave (XOF), and MVola (MGA). Merchant collection fees typically run 0.5%–1.5%.
PAD / ACH / Bacs (Direct Bank Debit)
Recurring bank-account pull rails: PAD in Canada (via Rotessa at C$0.50 flat or GoCardless), ACH in the US, Bacs in the UK, and BECS in Australia. Ideal for subscriptions and invoices because fees are capped at $3.50–$5.00.
PayFac (Payment Facilitator / Aggregator)
A provider (such as Stripe, Square, WiPay, DimePay, Tilopay, Paystack, or Razorpay) that holds a master merchant account with an acquiring bank and onboards sub-merchants rapidly online without requiring each merchant to apply for an individual bank MID.
Pix
The Central Bank of Brazil's instant payment rail (BRL). Free for consumers and priced at 0%–0.99% for merchants at gateways like Mercado Pago and PagBank, compared with ~4%–5% for immediate credit card payouts.
PSP (Payment Service Provider)
Umbrella term covering card gateways, Payment Facilitators, enterprise processors, and multi-rail aggregators that connect merchants to payment networks.
QRIS / QR Ph / PromptPay / DuitNow QR
Standardized national interoperable QR payment schemes across Southeast Asia (Asia-Pacific guide): QRIS in Indonesia (0.7% MDR), QR Ph in the Philippines (1.0%–1.5%), PromptPay in Thailand (1.65%), and DuitNow QR in Malaysia.
SEPA (Single Euro Payments Area)
The EU/EEA bank-transfer and direct-debit network covering 36 European countries (EUR). Under the EU Instant Payments Regulation, SEPA Instant transfers clear in under 10 seconds at parity with standard bank transfers.
Settlement / Payout Schedule (T+N)
The number of business days between capturing a customer's payment and receiving the cleared funds in your bank account (e.g., T+1 next day or T+2). In Latin America (South America guide), gateways like Mercado Pago charge lower rates if you wait 14 or 30 days for settlement versus immediate payout.
UPI (Unified Payments Interface)
India's real-time interbank payment rail (INR). Small-ticket UPI transactions remain 0% MDR, while large merchant transactions above ₹2,000 carry a 0.4% MDR (see Flash update).
VAT (Value-Added Tax)
General consumption tax that many jurisdictions levy on financial/payment processing fees (e.g., 15% VAT in Saudi Arabia and South Africa, 16% IVA in Mexico, 18% GST in India).
Wallet vs. Card Gateway
On Sympli5, a Card Gateway processes Visa, Mastercard, Amex, or domestic debit cards, whereas a Wallet / Local Rail processes closed-loop digital wallets (PayPal, Alipay, GCash, Lynk, Kanoo Pays, M-Pesa) or direct bank-to-bank debits (GoCardless, Rotessa, Ozow, Sentoo). Every currency page separates them into distinct tables.