Card acquiring

What it means

Card acquiring is the service through which a bank or payment institution enables a merchant to accept card payments. The acquirer processes the transaction through the card schemes, authorises it with the card issuer and credits the money, less its fee, to the merchant's account.

Physical shops get acquiring through a card terminal, online shops through a payment gateway. The merchant signs an agreement with the acquirer setting out fees, settlement times and rules for disputed payments.

The merchant's fee consists of the interchange fee paid to the issuing bank, the card scheme fee and the acquirer's margin. Blended pricing hides this breakdown, while interchange plus pricing makes it transparent.

How it works in practice

Acquirers usually pay out daily totals net of fees rather than each payment separately. In the books, however, sales must be recorded gross and fees as a separate expense, or turnover and VAT will be distorted.

Correct bookkeeping requires the acquirer's transaction report, which allows payment matching against cash register or online shop records. With many transactions, an automated import pays off.

For card payments in retail sales the merchant must record takings through eKasa. In an online shop it is important that money from the acquirer can be traced to specific orders and invoices.

What to watch out for

A customer can dispute a payment through a chargeback, for example when goods were not delivered. The acquirer then claws the money back, and if the merchant has no proof of delivery it loses both the sale and the goods.

The merchant is responsible for handling card data securely under PCI DSS. The simplest route is never to store card data and to let a gateway with tokenisation process it.