1. Business
  2. Reviews

140 Common Words Used In The Fintech Industry

The world of payments and finance can be filled with jargon and technical terms that can be confusing for newcomers. To help navigate this complex landscape, it’s important to have a basic understanding of some of the key payment terms and concepts. From electronic wallets to POS machines, here are some important (Nigerian ) payment terms to know to better understand the world of payments and finance.

This article provides a useful resource for individuals seeking to understand key terms and concepts in the finance and banking industries.

12-Factor Authentication (2FA)A security process that requires users to provide two different authentication factors to access an online account or perform a transaction.
23D Secure A security protocol is used by some banks and payment processors to reduce the risk of fraud in online transactions. It is an additional layer of security for online card payments that require the customer to provide an additional password or authentication code.
3AcquirerA financial institution that processes credit and debit card transactions on behalf of merchants.
4Acquiring BankAn acquiring bank is a bank that processes credit or debit card payments on behalf of a merchant. The acquirer helps merchants accept payments from their card-holding customers
5Agent BankingA banking model that uses authorized agents, such as supermarkets and retail shops, to provide basic financial services to customers in remote or underserved areas.
6AggregatorAn aggregator is a company that enables merchants to accept multiple payment methods through a single platform.
7Alternative credit scoringAlternative credit scoring refers to the process of using non-traditional data sources, such as utility bills, rental payments, and social media activity, to evaluate the creditworthiness of individuals or businesses who have little or no credit history.
8Anti-Money Laundering (AML)Anti-Money Laundering (AML) refers to a set of laws, regulations, and procedures aimed at preventing criminals from disguising illegally obtained funds as legitimate income by transferring them through financial systems. AML regulations require financial institutions to verify the identity of their customers and report suspicious activity to the relevant authorities.
9APIApplication Programming Interface
10Asset managementAsset management refers to the practice of managing and overseeing a company’s assets, including physical assets such as buildings and equipment, as well as intangible assets such as patents and trademarks. It involves monitoring asset performance, assessing risk, and implementing strategies to optimize the use and value of assets over time.
11AuthorizationAuthorisation is a process where a customer’s payment card is checked to ensure that they hold the necessary funds and approval to make a purchase from a merchant
12Authorization HoldA temporary hold is placed on a customer’s funds by their bank or credit card company during the payment authorization process. The process of verifying that a customer has sufficient funds or credit to make a payment
13Automated Billing SystemAn Automated Billing System is a software application that automates the process of generating and sending invoices to customers. It typically includes features such as automatic invoice creation, email delivery, and online payment processing. By automating the billing process, companies can save time and reduce errors associated with manual billing processes.
14ATMAutomated Teller Machine. A machine that allows bank customers to perform basic transactions, such as withdrawals, deposits, and balance inquiries.
15BalanceA balance refers to the amount of money or assets that an individual or organization has after taking into account all their debts, liabilities, and expenses.
17Bank TransferBank transfer is a payment method that allows money to be transferred electronically from one bank account to another. This can be done through various means, such as online banking, mobile banking, or wire transfer. Bank transfers are often used for transactions between individuals, businesses, and other organizations, and are a secure and reliable way to move money.
18BVNBank Verification Number (BVN): A unique identification number issued to bank customers in Nigeria to prevent identity theft and fraud in the banking system.
19BaaSBanking as a Service
20Batch ProcessingA method of processing payments in which multiple transactions are grouped together and processed at the same time.
21BINBIN (Bank Identification Number): The first six digits of a credit or debit card that identify the card issuer.
22Biometric Authentication A security feature that uses unique physical characteristics, such as fingerprints or facial recognition, to verify a user’s identity.
23BlockchainBlockchain is a digital ledger technology that enables secure and transparent recording of transactions across a network of computers, without the need for a centralized authority.
24BudgetingBudgeting is the process of creating a financial plan that helps individuals, businesses, or organizations to manage their income and expenses effectively, while also setting financial goals and priorities.
25BDCBureau De Change (BDC): A licensed operator that buys and sells foreign currencies.
26BursaryBursary is a financial award or grant that is provided to students by an organization, educational institution or government to help cover the cost of their education.
27B2BBusiness-to-business (B2B)
29BNPLBuy now, pay later
30BVNBank Verification Number is a biometric identification system introduced by the Central Bank of Nigeria to curtail illegal banking transactions in the country.
31CARCapital adequacy ratio (CAR)
32Capital marketsCapital markets refer to financial markets where businesses and governments can raise funds by selling stocks, bonds, and other securities to investors. These markets allow individuals and institutions to invest in various financial instruments, including stocks, bonds, and derivatives, and provide a means of raising capital for businesses and governments.
33Capital raisingCapital raising is the process of securing funds from investors and financial institutions to finance business activities and operations.
34Card Association These are brands that work in partnership with banks to offer payment cards to customers.  A network of financial institutions that set rules and standards for credit and debit card transactions, including Visa, and Mastercard.
35CVVCard Verification Value (CVV): A three- or four-digit number on the back or front of a credit or debit card used to verify the card’s authenticity during online transactions.
36CRRCash Reserve Ratio (CRR): The percentage of customer deposits that banks must hold as a reserve with the CBN. This is used to control the money supply in the economy.
37Cashless PolicyA policy aimed at reducing the amount of physical cash in circulation and promoting electronic payment channels to enhance efficiency, reduce costs, and curb corruption.
38CashbackCashback refers to a reward or incentive program offered by merchants or credit card companies, whereby a percentage of the amount spent on purchases is returned to the customer in the form of cash.
39CBNCBN (CENTRAL BANK OF NIGERIA) The Central Bank of Nigeria is the apex monetary authority of Nigeria
40Challenger bankChallenger bank refers to a type of financial institution that competes with traditional banks by offering innovative and technologically advanced financial products and services.
41ChargebackA process in which a customer disputes a transaction and the funds are returned to the customer.
42Chargeback Fee

Chargeback Fee: A fee charged to the merchant by the card issuer for the processing of a chargeback.
43CollateralCollateral refers to a valuable asset or property that is pledged by a borrower to a lender as security for a loan or credit.
44CommissionCommission is a fee paid by an entity to an agent for facilitating a transaction or sale. If you vend bills on Page Business API, you get commissions.
45ComplianceCompliance in finance refers to the process of ensuring that a financial institution or individual adheres to the laws, regulations, and standards that govern the financial industry. This includes measures to prevent money laundering, fraud, and other illegal activities, as well as ensuring the accuracy and transparency of financial reporting. Compliance is essential for maintaining the integrity of the financial system and protecting the interests of investors and the public.
46CaaSCompliance as a Service (CaaS)
47Consumer creditConsumer credit refers to any form of credit extended to individuals for personal, family or household purposes, such as credit cards, personal loans, and student loans. It is usually subject to interest and other charges, and is typically provided by banks, credit unions, and other financial institutions.
48Consumer financingConsumer financing refers to loans or credit offered to individual consumers to finance purchases such as household appliances, vehicles, or home renovations.
49Contactless PaymentContactless Payment: A payment method that allows customers to make payments using a contactless card or mobile device, without the need for physical contact with the payment terminal. Like Patronize Paypoint.
50Corporate financeConsumer financing refers to loans or credit that individuals can use to purchase goods or services, such as a car, home appliances, or other consumer products. It can be offered by banks, credit unions, or other financial institutions, and can come in the form of installment loans, revolving credit, or other financing options. Consumer financing can be secured or unsecured, and typically involves a credit check and underwriting process to determine the borrower’s creditworthiness and ability to repay the loan.
51Credit bureau
A credit bureau is an organization that collects and maintains credit information on individuals and businesses from various sources, such as banks, credit card companies, and other financial institutions, and provides this information to lenders, creditors, and other authorized parties for credit evaluation purposes.
52Credit Card A payment card that enables customers to borrow money from a financial institution to make purchases and pay it back at a later date.
53CRBCredit Reference Bureau (CRB). A licensed organization that collects and maintains credit information on individuals and businesses, which can be accessed by lenders to assess creditworthiness.
54Credit riskCredit risk refers to the likelihood that a borrower will default on a loan or fail to make payments on time, resulting in potential losses for the lender. It is a key consideration for financial institutions and is often assessed through credit scoring and other risk management techniques.
55Credit scoreCredit score is a numerical expression of a person’s creditworthiness, based on an analysis of their credit files and other relevant data, used by lenders to assess the likelihood that a borrower will repay their debts.
56Cross-border PaymentA payment that is processed across international borders, often involving currency exchange and compliance with international regulations. Like Lemonade Finance.
57Crypto CurrencyA digital or virtual currency that uses cryptography for security and operates independently of a central bank.
58Customer acquisitionCustomer acquisition refers to the process of acquiring new customers for a business, typically through marketing and advertising efforts.
59CDDCustomer due diligence (CDD)
60CXCustomer experience (CX)
61Customer onboardingCustomer onboarding is the process of guiding customers through the steps necessary to begin using a company’s product or service. It typically involves a combination of education, training, and support to help new customers understand how to use a product or service effectively. The goal of customer onboarding is to create a positive experience for customers and help them achieve their desired outcomes with the product or service.
62 CRMCustomer relationship management.
63Customer serviceCustomer service is the process of providing assistance and support to customers before, during, and after the purchase of a product or service to ensure their satisfaction and loyalty.
64Data breachA data breach refers to a security incident in which sensitive or confidential information is accessed, disclosed, or stolen by an unauthorized individual or entity.
65Debit cardA payment card that deducts funds directly from the cardholder’s bank account to pay for purchases.
66Debt collectionDebt collection refers to the process of pursuing payment of debts that are owed by individuals or businesses. This typically involves contacting debtors, negotiating payment arrangements, and possibly taking legal action to recover the debt.
67Debt consolidationDebt consolidation is the process of combining multiple debts into a single loan or repayment plan, typically with a lower interest rate or smaller monthly payments, to make it easier for the debtor to manage their finances and pay off their debts.
68Debt financingDebt financing refers to the process of borrowing funds from a lender, such as a bank, to finance business operations or personal expenses. The borrower agrees to repay the borrowed amount along with interest over a period of time, which is usually specified in the loan agreement. Debt financing is a common way to raise capital for businesses and can be used for a variety of purposes, such as expanding operations, purchasing assets, or financing new projects.
69Digital bankingDigital banking refers to the use of digital technology to provide banking services to customers, including mobile banking, online banking, and other digital channels. Digital banking allows customers to access banking services from anywhere, at any time, and often includes features such as online account opening, bill payment, and money transfers. It has become increasingly popular in recent years due to its convenience and accessibility, and many traditional banks have expanded their digital offerings to keep up with the trend.
70Digital currencyA form of currency that exists only in digital forms, such as Bitcoin or eNaira. eNaira is a Central Bank of Nigeria-issued digital currency that provides a unique form of money denominated in Naira. 
71Digital identityDigital identity refers to the unique representation of a person or entity in the digital world. It encompasses personal information such as name, date of birth, address, and other identifying details that enable individuals to access various digital services and conduct online transactions. A digital identity is essential for secure online interactions and is used for authentication and authorization processes. It is becoming increasingly important in today’s digital age, with more services and transactions moving online.
72Digital insuranceDigital insurance refers to the use of digital technologies to facilitate the purchase and management of insurance policies, as well as the processing of claims. It involves leveraging tools such as mobile apps, online portals, and artificial intelligence to make insurance more accessible, efficient, and personalized for customers. Digital insurance providers may also offer innovative products such as usage-based insurance, which adjusts premiums based on factors such as driving behavior or health data.
73Digital lendingDigital lending is the use of online technology to provide loans to borrowers without the need for traditional financial intermediaries such as banks or credit unions. It involves the use of digital platforms to streamline the loan application and approval process, which typically results in faster funding and lower costs for borrowers. Digital lenders use various data sources to underwrite loans and assess creditworthiness, including credit scores, income and expense data, and social media and online activity. Examples of digital lending platforms include peer-to-peer lenders, online small business lenders, and payday lenders.
74Digital paymentsDigital payments refer to the transactions made using digital methods, such as mobile wallets, online bank transfers, credit or debit cards, and other electronic payment systems. The use of digital payments has increased rapidly in recent years due to the convenience, speed, and security they offer compared to traditional cash-based payments. Digital payments are transforming the way businesses and consumers transact, making it easier and faster to send and receive payments across the world.
75Digital WalletA virtual wallet that stores payment information and can be used to make online or in-person transactions. Check out the Paga App.
76Direct DebitA payment method that allows merchants to automatically deduct funds from a customer’s bank account for recurring bills, subscriptions, or other regular payments.
77E-Bills Payment An electronic payment platform that enables consumers to pay bills, such as utility bills, taxes, and fees, through online or mobile channels. Check out the Paga App. And see Paga Business APIs for endpoints to integrate bill payments for your users.
78EFTElectronic Funds Transfer (EFT). The electronic transfer of funds from one bank account to another is often used for salary payments, bill payments, and online purchases. In Nigeria, these may go through NIBSS.
79EncryptionEncryption is the process of concealing data such that only authorized parties can have access to it. Like the hashing technique used on the Paga APIs.
80Endpoint securityEndpoint security refers to the practice of securing access points, or endpoints, where devices connect to a network, such as laptops, smartphones, or servers, to prevent unauthorized access, data breaches, or cyber-attacks. It involves a range of technologies and strategies, including firewalls, antivirus software, intrusion detection systems, and user behavior analytics, to protect endpoints from various threats and vulnerabilities.
81Financial InclusionFinancial Inclusion. The CBN’s initiative to ensure that all Nigerians have access to formal financial services.
82FintechFinancial technology
83Fixed DepositFixed Deposit, also known as a term deposit, is a type of investment account where money is deposited for a fixed period of time and earns a fixed rate of interest.
84ForexForeign Exchange (Forex): The conversion of one currency into another for the purpose of international trade and investment.
85Fraud detectionFraud detection is the process of identifying and preventing fraudulent activities before they cause harm or loss to individuals, businesses, or organizations. This can involve the use of various techniques such as data analysis, machine learning, and artificial intelligence to identify patterns and anomalies in financial transactions and behavior.
86Guaranteed fundsGuaranteed funds refer to investments or financial products with a low risk of losing money, where the principal amount invested is typically protected by a guarantee provided by the issuer or a third party.
87Identity verificationIdentity verification is the process of authenticating the identity of an individual or entity. This is typically done using personal information such as name, date of birth, and government-issued identification documents. The purpose of identity verification is to prevent fraud and ensure that individuals and entities are who they claim to be.
88Import and Export GuidelinesRegulations issued by the CBN govern the import and export of goods and services.
89ISSInterbank Settlement System (ISS)
90Interbank TransferA transfer of funds between banks often involves transactions between different financial institutions.
91Interchange FeeA fee is charged by the card issuer to the merchant for processing a credit or debit card transaction.
92IssuerA bank or financial institution that issues credit and debit cards to customers.
93ISSUING BANKThis is the bank that issues payment cards to the customer.
94KYCKnow Your Customer (KYC). The process of verifying the identity of customers and assessing their potential risks in relation to financial transactions, as required by regulatory agencies to prevent fraud and money laundering.
95Liquidity RatioThe minimum percentage of a bank’s assets must be held in cash or other easily liquidated assets.
96MerchantA merchant is a person or entity that sells goods or services to customers in exchange for payment. In the context of finance and banking, a merchant may refer to a business that accepts electronic payments through credit cards, debit cards, or other payment methods.
97Merchant AccountA merchant account is a type of bank account that allows businesses to accept payments through debit or credit card transactions. It acts as an intermediary between the business owner and the acquiring bank, facilitating the transfer of funds from the customer’s bank to the business owner’s bank account.
98Merchant AcquirerA merchant acquirer is a financial institution that processes debit or credit card payments on behalf of a merchant. The acquirer is responsible for receiving the payment information from the merchant’s bank and transmitting the funds to the cardholder’s bank. Additionally, the acquirer may provide other services to merchants, such as payment gateway and fraud prevention solutions.
99MCCMerchant Category Code (MCC). A four-digit code assigned to merchants by payment card networks is used to classify businesses according to the type of goods or services they offer.
100MSCMerchant Service Charge (MSC). A fee charged by banks to merchants for accepting payments through their payment channels, such as POS terminals and payment gateways.
101mPOSMobile Point-of-Sale (mPOS). A portable device that enables merchants to accept credit and debit card payments on the go.
102Mobile Wallet A digital wallet that allows users to store payment information and make purchases using a mobile device. See Paga App.
103Monetary PolicyThe actions taken by the CBN to regulate the money supply, interest rates, and credit availability in the economy.
104NIBORNigerian Interbank Offered Rate (NIBOR). The interest rate at which Nigerian banks offer to lend funds to one another in the interbank market.
105NIBSSNigerian Interbank Settlement System (NIBSS). A financial infrastructure provider that operates the national payment system of Nigeria.
106NPLNon-Performing Loan (NPL): A loan that is in default or has not been paid back according to the terms of the loan agreement.
107NUBAN NUBAN (Nigeria Uniform Bank Account Number): A 10-digit bank account numbering system used in Nigeria to standardize account numbers and facilitate electronic payments. Paga APIs offers Dynamic NUBAN Accounts.
108OTPOne-Time Password (OTP). A security feature that provides a unique, time-limited code to authenticate a user’s identity during a transaction.
109Open Banking A system that allows third-party financial service providers to access financial data and services from banks through the use of APIs, with the aim of improving competition, innovation, and customer experience.
110OMOOpen Market Operations (OMO). The buying and selling of government securities by the CBN to control the money supply in the economy.
111Payment AggregatorA company that collects payments on behalf of merchants and distributes the funds to the merchant’s accounts.
112PCI DSSPayment Card Industry Data Security Standard (PCI DSS): A set of security standards established by major card brands to protect against credit card fraud.
113Payment Card A physical or virtual card used by customers to make payments.
114Payment GatewayA service that connects merchants to the acquiring bank and enables the processing of online payments. See Paga APIs.
115Payment Link A secure online link that allows customers to make payments without the need for a physical card reader. See Paga Request Money.
116Payment ProcessorA company that facilitates the processing of electronic payments for merchants.
117Payment ReconciliationThe process of comparing and matching payment transactions with corresponding orders or invoices to ensure accurate accounting and reporting.
118PSBPayment Service Bank (PSB). A type of bank licensed by the CBN to provide basic financial services, such as deposits, withdrawals, payments, and remittances, to individuals and small businesses.
119Payment System Operator A company that operates a payment system, such as a card network or electronic funds transfer system.
120Payment SystemThe set of rules, procedures, and technical infrastructure used by financial institutions to facilitate the exchange of funds between individuals, businesses, and governments.
121Payment TerminalA hardware device used by merchants to process payments, including POS terminals and mobile card readers.
122PaymentThe transfer of money or value from one party to another in exchange for goods or services.
123PCI DSSPCI DSS (Payment Card Industry Data Security Standard): A set of security standards developed by major credit card companies to ensure that merchants and payment processors handle credit card data securely.
124PCI SSCPCI SSC (PAYMENT CARD INDUSTRY SECURITY STANDARDS COUNCIL) PCI SSC is a council created by the major Card Associations to ensure that security standards and regulations required of players in the online payments space are met
125P2PPeer-to-peer (P2P)
126PINPersonal Identification Number (PIN)
127POSPoint of Sale (POS) Terminal: A device used by merchants to process card payments from customers, usually through debit or credit cards. Like Paga POS.
128PSPPSP (PAYMENT SERVICE PROVIDER) A PSP helps businesses accept electronic payments from their customers online. Paga is an example of a PSP.
129Recurring PaymentA payment that is charged on a regular basis, such as a subscription or membership fee.
130RefundThe process of returning funds to a customer after payment has been authorized.
131RemitaA payment platform developed by SystemSpecs Limited that allows individuals and organizations to make and receive payments across multiple channels, including banks, mobile wallets, and cards.
132QRQuick Response (QR) code
133RemittanceA transfer of money from one location or country to another, often involving sending money to family or friends.
134SettlementThe process of transferring funds from the acquiring bank to the merchant’s bank account after a successful payment transaction.
135Settlement BankThe bank that holds the funds for the merchant after a payment transaction has been settled.
136Subscription BillingA payment model in which customers are charged on a recurring basis for goods or services.
137Swift CodeAn international bank code used to identify banks and financial institutions in international transactions.
138Switching CompanyA company that facilitates the interconnection and interoperability of payment systems between different banks and payment processors, allowing for seamless payment transactions across different platforms.
139TokenizationA process that replaces sensitive payment information, such as credit card numbers, with a unique identifier, or token, to protect against fraud.
140Treasury BillsShort-term government securities issued by the CBN to raise funds to finance government expenditures.
141TSATreasury Single Account (TSA): A unified structure of government bank accounts enabling consolidation and optimum utilization of government cash resources.

We are committed to keeping this list of payment terms current and relevant. As we discover new terms, we will update the article accordingly. We encourage you to revisit the article periodically to stay informed and up-to-date on the latest payment terminology.

Comments to: 140 Common Words Used In The Fintech Industry

Leave a Reply