The transaction process
There are four parties to each transaction in addition to Mastercard — a cardholder, a merchant, an issuer and an acquirer.
Step 1: The customer pays with Mastercard
The customer purchases goods/services from a merchant.
Step 2: The payment is authenticated
The merchant point-of-sale system captures the customer’s account information and securely sends it to the acquirer.
Step 3: The transaction is submitted
The merchant acquirer asks Mastercard to get an authorization from the customer’s issuing bank.
Step 4: Authorization is requested
Mastercard submits the transaction to the issuer for authorization.
Step 5: Authorization response
The issuing bank authorizes the transaction and routes the response back to the merchant.
Step 6: Merchant payment
The issuing bank routes the payment to the merchant’s acquirer, who deposits the payment into the merchant’s account.