Payment processor
A company that routes card transaction data between merchants, acquirers, card networks and issuers to authorize, clear and settle payments.
What a payment processor is
A payment processor is a technology company that handles the messages behind a card payment. Merchant processors work for acquirers and merchants, sending authorization requests and settlement files. Issuer processors work for card issuers, approving transactions and managing card accounts, often for virtual card and debit programs.
How it works
When a card is used, the merchant processor sends the request through the card network to the issuer processor, which approves or declines it. Later, clearing and settlement move the funds, with interchange going to the issuer and the net amount to the merchant account.
- 01 · AUTHORIZE The processor sends the purchase to the issuer, which approves or declines it.
- 02 · CLEAR At day's end, the processor submits captured transactions to the network.
- 03 · SETTLE Funds move from the issuer to the acquirer, which pays the merchant.
When businesses use it
- Merchants and acquirers routing card sales in store and online
- Card issuers and fintechs running debit, prepaid or credit programs
- Platforms adding a second processor for redundancy
- Companies issuing cards by API, with real-time spending controls
Cross River processes card programs on its own platform, which is PCI DSS Level 1 certified. It adds real-time fraud monitoring, 3D Secure and webhooks that stream authorization and settlement data. See card processing at Cross River.