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E-commerce Glossary

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We have compiled a list of e-commerce terms in our e-commerce glossary page. You might find it useful in helping you to understand some "Jargons" used extensively in e-commerce related fields.

3-D Secure Authentication
New system aimed at reducing online credit card fraud and chargeback. It enables additional authentication on the cardholder's identity by asking for additional PIN during an online shopping transaction. VISA name it "Verified by VISA" while MasterCard name it "Master SecureCode".

Affiliate Program
A popular website promotion tool where a website exchange links with other complementary websites for driving visitor to its site.

AVS (Address Verification Service)
A service used to verify that the billing address and zip code supplied by the customer match the address where credit card statements are sent that is on record at the card-issuing bank. The purpose of AVS is to reduce the likelihood of fraud, and so the discount rate is usually lower. Unfortunately, AVS is supported in the US & UK only.

B2B (Business to Business)
A business model for business on Internet. It means e-commerce transaction between two business organizations.

B2C (Business to Consumer)
A business model for business on Internet. It means e-commerce transactions between a business and end-users.

Billing Address
The address to which a Customer's credit card billing statement is mailed. It is used to help verify that the Customer is the actual owner of the credit card he/she is using. (see AVS)

BIN (Bank Identification Number)
A Bank Identification Number (BIN) is the first six digits of a credit card, debit card, or charge card. These digits identify which network the card belongs to as well as which bank issued it. Merchants may use BIN lookups to help validate transactions. For example, if the credit card's BIN indicates a bank in one country, while the customer's billing address is in another, the transaction may need extra scrutiny. The term "Issuer Identification Number" (IIN) is replacing "Bank Identification Number". See ISO 7812 for more information.

The status of a transaction that has gone through Authorization or Post Authorization and is waiting for settlement.

CNP (Card-Not-Present)
Card Not Present (any type of transaction where the card cannot be swiped). Also known as MOTO (mail order/telephone order). All transactions where a credit card is not physically swiped through a terminal, including internet transactions, phone transactions, or credit-card numbers keyed into a terminal/virtual terminal, fall into this category. (see CP)

Certification Authority (CA)
Abbreviated as CA, a trusted third-party organization that issues digital certificates used to create digital signatures and public-private key pairs. The role of the CA in this process is to guarantee that the individual granted the unique certificate is, in fact, who he or she claims to be. CAs are a critical component in data security and e-commerce because they guarantee that the two parties exchanging information are really who they claim to be.
More info at

Charge Back
A chargeback occurs when a buyer disputes a transaction with his or her credit card issuer. Among other reasons, a buyer may request a chargeback if:

  • An unauthorized party has made a purchase with the buyer's credit card.
  • The buyer hasn't received the items he or she purchased.
  • The buyer has been charged multiple times for the same order.
  • The buyer has other concerns about the validity of the purchase.
  • The buyer is unsatisfied with a purchase and hasn't been able to resolve the problem with the merchant.

CP (Card-Present)
Pertaining to a credit card transaction in which the cardholder and the card are physically present. Typically, the credit card passes through a card reader and the cardholder signs a receipt. On average, the Discount Rate for Card-Present transactions is lower than the Discount Rate for Card-Not-Present transactions due to lower risks. (see CNP)

Credit Card Processing
Once the payment gateway accepts the transaction, this service records the transaction, removes funds from the credit cardholder’s account and deposits these into your merchant account.

Cross Selling
Offering products that compliment other products that a customer wishes to purchase.

CSR (Certificate Signing Request)
A Certificate Signing Request is a text file generated by a web server which contains Information about your organization and your web server's public key.

CVC2 (Card Validation Code 2) & CVV2 (Card Verification Value 2)
VISA and MasterCard implemented a security code feature known as "CVV2" and "CVC2". The security code is a 3 digit code imprinted on the physical credit card, but not embedded or encrypted in the magnetic stripe. The code is a 3-digit number located on the signature strip on the back of Visa and MasterCard cards, after the card number. It is on the front of American Express cards, and it is 4 digits long. These three-digit code helps validate that the cardholder has the card in his/her possession, and the account is legitimate. If you are using a shopping cart, make sure it is capable of collection these numbers.

For Visa, MasterCard and Discovery, the card verification value is printed on the back side of the card. It is the last three digits at the top of the signature panel.

CVM (Card Verification Method)
A method used to ensure that a credit card being used in a purchase is in the possession of its owner.

A message given to a web browser by a web server. The browser stores the message in a text file. The message is then sent back to the server each time the browser requests a page from the server. The server can use this information to present you with custom Web pages. So, for example, instead of seeing just a generic welcome page you might see a welcome page with your name on it.

Domain Name
The unique name that identifies your website.

Digital Certificate
A digital certificate is an electronic certificate that establishes your credentials when doing business or other transactions on the Web. The certificate is issued by a Certification Authority (CA). It contains your name, a serial number, expiration dates, a copy of the certificate holder's public key used for encrypting messages and digital signatures and the digital signature of the certificate-issuing authority so that a recipient can verify that the certificate is real. Digital certificates can be kept in registries so that authenticating users can look up other users' public keys.

Discount Rates
The fee a merchant pays to banks for acquiring the merchant's transactions. The fee is a small percentage of each purchase. The rate is different for each merchant as transaction volume, susceptible-to-risk factor will affect the rate.

EDI (Electronic Data Interchange)
Short for Electronic Data Interchange, the transfer of data between different companies using networks, such as the Internet. As more and more companies get connected to the Internet, EDI is becoming increasingly important as an easy mechanism for companies to buy, sell, and trade information. ANSI has approved a set of EDI standards known as the X12 standards.

EMV (Europay MasterCard and Visa)
The internationally-agreed standard for chip payment cards, originally agreed by Europay, MasterCard and Visa. EMV standards are maintained by EMVCo, an organization owned and managed by MasterCard, Visa and JCB.

Fraud Score (FraudLabs)
FraudLabs web service Fraud Score is directly proportional to the risk of the input values associated with each transaction, such as IP address, email address and billing address and so on. The higher the scores, the higher the risk of fraudulent transactions.

FraudLabs has been actively involve in research to fight online credit card fraud. More on the details please visit


FTP (File Transfer Protocol)
File Transport Protocol, this refers to a software tool that allows you to transfer files from your local computer to your hosting companies server or any other network.

Google Adwords
Google's trademarked name of its Pay-Per-Click advertisement system.

HTML (Hyper Text Markup Language)
The language used to format content and presentation for the World Wide Web. This language lets the text include codes that define fonts, layout, embedded graphics, and hypertext links.

IVR (Integrated Voice Response)
Integrated Voice Response telephony is the technology that creates automatic message selections through phone systems.

Soft Goods (Downloadable)
Downloadable goods. Examples include e-books, instructions, mp3 files, mpeg4 videos etc.

MasterCard SecureCode
MasterCard SecureCode is a new service to enhance your existing MasterCard account. A PIN code will be linked to your credit card for added protection against unauthorized use of your card when you shop at participating online merchants. Similar technology by VISA is known as VERIFIED by VISA.

More info at

Merchant Account
Allows a business to accept credit card transactions from customers. Merchant accounts are commercial bank accounts set up between a retail business and a financial institution. Funds from customers are deposited into the merchant account.

MOTO - Mail Order Telephone Order
Mail Order/Telephone Order (MOTO) transactions are those carried out by a customer by phone, mail or over the Internet. The customer pays for goods or services by providing their payment details (for example, card type, card number and expiry date) directly to the merchant. One of the MOTO service available for Malaysia Merchant is mCashier by Nanyang Online. Contact us to find out more.

Online Marketplaces
Web-based trading exchanges for buyers and sellers to meet and conduct business.

Order Tracking
The process of tracing the status of particular order placed by a customer in a web store.

Partial Shipment
A process in which a store ships/provides only some of the goods/services in a single order. Therefore, the Post Authorization amount would be less than the amount of the approved Pre Authorization for the order.

Payment Gateway
A computer system that acts as a mediator between a merchant account and online storefront. Payment gateway is used in authentication of credit card information and real-time charging from a credit card.

Post Authorization
A transaction that puts a Pre Authorization transaction into a Captured state for settlement. In the case of partial shipments, the Post Authorization amount may be less than the Pre Authorization amount. By law (US), Post Authorization can be initiated only after the purchased goods have been shipped.

Pre Authorization
A transaction type in which a cardholder's account is verified to be in good standing, that is, the card is valid and has not reached its limit. Any applicable Address Verification Service (AVS) checks have been performed and approved. If the verifications are approved, the total amount of the order is reserved against the cardholder's account balance. Pre Authorization are used if goods are to be physically shipped or in other cases for which the merchant must first verify whether the order can be fulfilled. An approved Pre Authorization is followed by a Post Authorization, which prepares it for settlement.

PPC (Pay-Per-Click)
Online advertising in which payment is based on each time a customer clicks on your link/advertisement. The most popular one being Google Adwords.

Recurring Transactions
A transaction in which a cardholder has given a merchant permission to periodically charge the cardholder's account. E.g. Magazine Subscription Renewal.

Search Advertising
Also known as paid search -- is the act of buying listings on the search engines. You know, Google AdWords , Yahoo Search Marketing , Microsoft AdCenter , Ask Sponsored Listings .

Search Engine Optimization
It is the act of getting listed in search engines for free. It is PR for the search engine world. There are things that you can and should be doing to improve your listings with search engines, in the same way that there are things you can and should be doing that can improve the coverage you receive for free from television, radio and TV.

Search Marketing
It’s the umbrella term that encompasses any act of generating traffic from search engines. The two main areas under search marketing are search advertising and search engine optimization (SEO). Check out Neowave's SEO Shopping Cart Software.

SSL (Secure Sockets Layer)
It’s a protocol designed for secure transfer of Information over the Internet. Information sent through an SSL-secured form is encrypted so that the information is not tempered with while the transfer is taking place.

Up Selling
Offering products to a customer which have a higher value or are more advanced than the items they currently purchase.

Variations on your product, including different sizes, colors, and prices. For e.g. a thumbdrive (USB) drive is available in sizes ranging from 128MB to 1GB. Since they all look the same, you only need to include one product photo and description yet offer several variants. Variations is one of the feature available in webShaper e-commerce.

Verified by Visa
Verified by Visa is a system used by Visa as an added layer of security for online credit card transactions. It relies on a password to validate the transaction. This acts in the same way as using a PIN or signature when you make purchases over the counter. This will ensure that it is in fact you making the purchase. The similar system is used by Master Card under the name SecureCode. It is an easy-to-use password-protected online payment verification system that ensures that you will know that the cardholder is who they say they are. See MasterCard SecureCode

Website Statistics (also known as Counters)
Statistical tracking of your website visitors. With the info, you can refine your online marketing strategy. Our all-time favorites is Statcounter for its value-for-money services and ease-of-use.

WYSIWYG (What You See is What You Get)
"What You See is What You Get" is a feature of an editor. Such editors show the exact appearance of the desired output while you are creating the document or a web page without the need of knowing HTML language.



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