you really looking for a recipe to fail? Well then – wait no more, jump
directly the section marked as “The Recipe to Fail”.
you were forced to descend on this land-of-rants via some strange looking
link out of google search result then, may God be with you and I hope
and pray this post wouldn’t disappoint you in on how to achieve the epics of failure.
say: “Failing to plan, is a plan to fail”.
on! Before you judge my ingenious self, let me quote, “Never confuse education
with intelligence” – I don’t know whoever said that, but just keep that in mind
while you scan through my rant.
Times make me wonder if it’s a
genetic fault, or was a failed-experiment mutated in my genes by UFO hovering Dubai Skies while I slumber – as to why (unknown/strange) I happen to look for trouble
(I was gonna write *challenges* but that didn’t sound just right.).
Certified Treasury Professional® (CTP) is a globally recognized certification
within Financial Services Industry. It was first introduced as the Certified
Cash Manager (CCM). It sets the standard or benchmark by which individuals
demonstrate their competency and professionalism in corporate treasury. This
certificate is more US, Canada, Australia focused/inclined.
On the other hand, CertICM is counterpart certification provided by
Association of Corporate Treasurers (ACT) that focuses on Europe, MENA region,
and even in East Asia (Hong Kong, Singapore, etc). CertICM is called
Certified in International Cash Management.
Just a couple of days ago, I was caught into a discussion explaining to a colleague how card payment process works. I thought this is a fair material to be shared. So here it is, in its simplest form. Note that, following simple elaboration does not mean, it is “that simple”. This provides high level of understanding or a basic understanding of how card network works, clears and settles transactions.
Do you know how a card payment is made?
If you are new to Card Payments, just remember ABCF (yes, not D, an F)
Credit card presented to merchant for purchase
A: Authorization request: Get the authorization from Issuer whether the card is valid or not.
Hold placed on credit limit
Hold converted to charge/funds remitted through network to merchant
B: Batching: An end of day running
Charges sent for clearing by merchant/transaction data routed to issuing bank
C: Clearing: Debit entries
S: Settle: Payment of actual funds, credit entries
Lets imagine Robin (from the BatMan and Robin) is at the Nike outlet counter, and pulling out her brand new platinum credit card(or debit card, for that matter) with a MasterCard(or VISA) network stamped on it from Bank de Papa. She provides the card to the sales person on the cash counter, to charge for the shopping and then return the card.
What happens next?
Sales person swipes the card, and wait for the authorization code from Bank de Papa (that is, Issuer)
The transaction goes to Bank de Mama (that is, Acquirer), which in turn is routed to Card network.
Card network routes the transaction to Bank de Papa (that is, Acquirer)
Bank de Papa verifies the card detail, and if valid then provides an authorization code in return, via same path, all the way back to sales person credit card device (that is, Merchant)
Merchant runs the end of day, and send the batch to acquirer via card network
Robin: Card holder
Sales person on the cash counter: Merchant
Bank de Papa: Issuer bank
Bank de Mama: Acquirer
In case if you are lost in the Robin, her Mama and Papa, following visual will help you understand the complete flow of events. FIG1: Card payment business process flow (Debit Card, Credit Card, MasterCard, VISA, etc)
Clearing and Settlement
Clearing/settlement generally happens through the Card Network settlement bank.
MasterCard transactions are processed through the MasterCard Worldwide Network using Global Clearing Management System (GCMS), and the MasterCard Settlement Account Management (S.A.M.) system.
In case of VISA, the Visa International Base II system clears and facilitates settlement. Settlement is not carried out through Base II; Visa merely provides the data to allow settlement to be carried out.
For settlement in US dollars, Chase Manhattan Bank, New York, acts as the settlement bank. For multicurrency settlement, Chase Manhattan Bank, London, acts as the settlement bank. All members may hold their own settlement account with any other financial institution, such that all requests for funds or payments are ultimately settled through the correspondent services of domestic clearing and settlement systems.
Write to me or comment, if you think you’ve got a feedback.