When it comes to processing online and other transactions, there are a good number of variables that go into making these transactions safe and secure, while insuring that transactions are credited to the correct accounts and run through the appropriate network. Each customer, or merchant, must have specific, identifying information to allow for the timely and secure processing of sensitive information.
All online merchants are assigned what is referred to as a merchant identification number (MID) as part of credit card processing. This is used by the computer network to identify the merchant processing a transaction.
These numbers are highly important as there are literally millions of different businesses around the world that wish to process credit card transactions. This number is how the merchant is identified correctly across the network and routes the transactions through the appropriate channels.
Not to Be Confused with a Merchant Account ID
While the name is similar the merchant identification number and merchant account ID are not the same thing.
A merchant account ID is used when one operates different businesses or transactions types under one umbrella “gateway.” For example, a corporation with a number of different sub-brands would have a specific merchant account ID assigned to each business, while the merchant identification number would be the same for the entire corporation.
What Else is Involved?
A merchant account is not complete with just an identification number. In addition, the account also includes a gateway identification number (GID) and terminal identification number (TID).
The TID, and there are often more than one for each merchant, identifies the facility that is responsible for the completion of a transaction.
GID refers to the network that the merchant will use to process any orders.
These three bits of information are what tell the network who is being paid, how they are being paid, and even what network to process their payments on.
Credit card processing is an important part of any online or brick-and-mortar business. The security of a customer’s private financial information is also paramount. When processing a transaction, the specific merchant identification number is the number that is issued to each store in order to ensure the transactions end up in the appropriate place.