The Essentials You Need to Know About Acquiring

There was a time when cash ruled everything, but today, credit and debit cards have become the norm. Behind the convenience of a simple card tap or online checkout lies a complex system — and that's where acquiring comes in. By partnering with an acquirer, businesses ensure that funds move securely from cardholders to their accounts. In this article, we'll break down the essentials, making it easy to understand this term. 

What Does Acquiring Mean?

Acquiring is the process that makes card payments possible, both online and in physical stores. When a customer uses their card to pay, an acquirer — usually a licensed bank or financial institution — facilitates the transaction by transferring funds from the customer's card to the merchant's account. This process relies on the acquirer's ability to work with payment systems like Visa or Mastercard, ensuring transactions are verified and risks are managed effectively.

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Not all banks can act as acquirers, as they must meet strict licensing and regulatory requirements set by payment systems. Acquirers are crucial in confirming payments, handling transaction data, and minimizing risks. Many acquirers also partner with payment providers to offer businesses secure and efficient payment solutions. In essence, acquiring is the key to enabling fast, secure, and reliable card payments for merchants and their customers.

How Acquiring Facilitates Card Payments?

When a customer pays for a purchase — either by tapping their card on a POS terminal or entering their card details online — they initiate a transaction that triggers a series of steps to ensure the payment is secure and successful. Here's how acquiring works in a streamlined process:

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1. Transaction initiation. The customer starts the process by consenting to the payment, which sends a request to the payment gateway.
2. Fraud screening. The gateway or payment provider runs fraud checks to detect any suspicious activity.
3. Payment system validation: The request is sent to the payment system (e.g., Visa or Mastercard) for further processing.
4. Issuing bank approval. If the payment system forwards the request to the cardholder's bank (the issuing bank), it checks if funds are available and verifies the card's status.
5. Acquiring bank confirmation. Based on the issuing bank's response, the acquiring bank either approves or declines the payment.
6. Fund transfer. Upon approval, the acquiring bank processes the funds and transfers them to the merchant's account or the payment provider, depending on the setup.

Exploring the Different Methods of Acquiring

Acquiring comes in various forms, catering to different payment scenarios. Each method enables businesses to provide seamless payment options for their customers. Here's a breakdown of the most common types of acquiring.

Internet Acquiring

Internet acquiring allows merchants to accept card payments for online transactions. It involves integrating a payment gateway to ensure secure processing of customer payments. This is an essential tool for e-commerce businesses looking to offer a smooth and reliable checkout experience.

Merchant Acquiring

Merchant acquiring facilitates card payments in physical stores, such as cafes, restaurants, and retail shops. They typically use POS terminals from acquiring banks or payment providers to process transactions. This method simplifies payments for customers while offering merchants efficient solutions for in-store sales.

Mobile Acquiring

Mobile acquiring enables businesses to accept payments anywhere using compact mPOS devices connected to a smartphone or tablet. This setup is perfect for on-the-go businesses like food trucks or delivery services, providing the flexibility and mobility to process card payments anytime, anywhere.

Crypto Acquiring

Crypto acquiring allows merchants to accept payments in cryptocurrencies, offering a secure and borderless alternative to traditional payment methods. With the rising popularity of digital currencies, crypto acquiring is becoming an essential option for businesses aiming to attract a tech-savvy customer base.

Take the Lead

At WhiteFLo, we offer innovative white-label software, which provides a crypto-acquiring method upon purchase. With our solution, you can equip your clients with essential crypto payment functionalities while also gaining access to open-source code for maximum flexibility. Book a demo right now and take one step ahead of the competition.

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