Glossary

Bankcard

A bankcard is a card-based financial tool. It is issued by a bank and designed to provide the cardholder with purchasing ability, cash access, account maintenance and/or other electronic services.

A bank card is made of plastic. The front typically features the bank’s name, a logo, a background in the bank’s colors, the cardholder’s name, a unique card account number and the month and year that the card expires. It might also feature the name of a credit card processing network like Visa or MasterCard and a description of the card type, such as “Credit Card” or “Debit Card.” The back of the card features a magnetic strip that stores account and access data, logos for different ATM networks where the card can be used to take out cash, a signature line to help prevent fraud and customer service instructions. Additional account access and security features, such as a hologram, smart card chip and/or Card Verification Value code, are displayed on the front or back.

Banks offer both personal and merchant account bankcards for use at the point-of-sale in a store, over the phone and online. If a brick and mortar business owner has a merchant account at a credit card processing company, a cashier, sales clerk or other employee can process a transaction by swiping the card through a credit card processing machine or portable magnetic stripe reader and computer software. The merchant can also manually input the information into the machine, software or over the phone at a store or outdoors via wireless or online. Bankcard holders can also input their own information through e-commerce checkout portals.

Bankcards are also useful for accessing account information and getting money at an ATM. A cardholder slides the card into a built-in magnetic stripe reader and then inputs a Personal Identification Number (PIN) when prompted using the ATM’s keypad. Whether the card is a debit or credit card, the cardholder can only withdrawal funds as approved under the agreement set with the bank that issued the card based on the available balance. Some banks restrict the use of their bankcards to specific purposes: A bank might provide a cardholder with a “debit-only” card that the cardholder can’t use for signature-based (credit card style) transactions. Another restricted card example is a “store card” that acts like a credit card but can only be used at stores linked to one merchant.