Switching involved in Acquiring

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Introduction

Switching is a centralized dedicated software system, which is overall controlling the different functionality which starting from capturing of data (messages) of the monetary transaction and non- monetary transaction through different channel and route it to the different entities.

  • Capture and Route
  • Capturing transaction and Routing to different entities (Authoriser).
  • Examples of Switch – Electra, Open to Switch
  • End to End processing
  • Customer to Distribution

There are different phases in the Acquiring and Switching

  1. Captures of the data through different channel.
  2. Receive of the different message in a central Transaction Management entity.
  3. Storage of all the messages in a central Database
  4. Depending on the type of transaction; ON-US or NOT ON-US transaction routing to correct destination.

Depending on the Bank, a Switch can be an Acquiring Switch or Issuer Switch. If  the message capturing through different channel is excluded for the other phases like Transaction Management and Routing part,  the rest can be form the part of the Issuer switch.

Phase I

Capturing through different channel

Capturing monetary transaction in different channel

  1. ATM

– Whenever an ATM is set for the first time/ there is change is accepting which all cards can be accepted, a down load file is being sent/ receives from the ATM and Switch.

Based on the type of the card, a OPCODE is being generated and as per that the screen are displayed; if it is a ON-US card then number of facility are provided to the card holder; other wise up to Authorization, only few functionality will be provided to the card holder.

– 1 OPCODE = 8 keys

– There is a one to one connection between the switch and ATM.

  1. POS
    • Different POS are connected to the NAC (Network Access Control)
    • Data is sent from POS to NAC by means of (TPDU –Transaction Packet Data Unit)
    • POS uses the protocol Rs 232/x25
    • Example of the POS –Hyercom, Visacheck, Visa1
  2. e-Merchant

-Merchant logon to the website through which he connect to the Web Server which in turn connect to the Payment Gateways – which again connect to the specific Interchange – again get connect the specific Acquirer id.

  1. IVR
    • Mail Order Telephone Order –MOTO
    • Interactive Voice Recognition (IVR)
  2. Local Networks

Phase II

Transaction Management ( Routing to different entities; based on the ON-US and NOT ON-US transaction)

Difference between the ON – Us and NOT ON –US

ON – Us NOT ON –US
1. Check Card Check Card
2. Check Card Expiry PIN translate Security data
3. Check Stop list (Lost/Stolen) Route
4. Check Security (PIN, CVV1, CVV2) Process Response
5. Process Response  

Phase III

Routing to different channel

  • Bank Host
  • VISA/MC
  • Card Management System

 

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