Skip to main content

Parties and Steps Involved in a Credit Card or P-Card Transactions


When you use a credit card or procurement card, you only see the merchant and your credit card issuers. Ever wondered who are the other parties involved?

Parties Involved in Transaction



  • Card Holder – You (as a Purchaser) are the card holder

  • Merchant – Vendor or retailer you are buying from (e.g. Walmart)

  • Issuer – Your credit card or professional card issuing company (e.g. Citi Bank).

  • Acquirer – Merchant’s bank that allow merchant to accept card (e.g. Wells Fargo)

  • EPOS provider – Technology provider providing merchant’s capability of accepting card

  • Bankcard association – Association that connect Issuer and Acquirer (e.g. Visa)

Step by Step Flow of P-Card Transactions



  1. Buyer Receives invoices from supplier

  2. Buyer Initiates payment to merchant

  3. Merchant charges the card and receives confirmation of payment.

  4. Buyer receives confirmation of payment.

  5. Merchant sends payment request for all card transaction to Acquirer.

  6. Acquirer forwards the request to bankcard association.

  7. Bankcard association sends the request to Issuer to settle the bill.

  8. Issuer settles the fund to Acquirer.

  9. Acquirer deposits the fund to Merchant bank account.

  10. Merchant receives the fund.

  11. Issuer updates the bank statement.

  12. Buyer pays the Issuer.

Credit Card vs P-Card


P-Card is known by many names: Procurement Card, ProCard, and Purchasing Card. P-Card are similar to credit card, but there are few differences.

  • The primary difference is that P-Card is used by business users for corporate expenses whereas Credit Card is used by consumers for daily expenses.

  • P-Card allows organizations to take advantage of existing credit card infrastructure to make electronic payments.  Using P-Card, organizations can follow simplified procure to pay process for low value items.

  • The payment for the P-Card is handled by organization whereas payment for the Credit Card is handled by the customer.

  • P-Card bill is always paid in full whereas Credit Card bill can be paid over the period, payment of minimum due is enough.

Comments

Popular posts from this blog

26 Proven Work at Home Business Ideas You Can Run Part Time

If you are looking for work at home business ideas, then this list can help you. All of these can be done as part-time business, so you don’t have to leave your job until you are confident of making full time income from your Work at home business.

How to Find Niche Website Ideas for Affiliate Blogs

Choosing right niche website ideas is the most critical decision. The topic of your affiliate blog will have huge impact on the outcome of your efforts over several years.

21 Passive Income Ideas to Achieve Financial Independence

Passive income is the key to achieving financial independence.  Earning Passive income requires you to create some form of asset that can generate income. You might still need some effort to maintain the asset, but it would be significantly less than effort required to build the asset. If you are looking for ideas to generate passive income, than below list of options can help you generate it.