Payment Cards and Electronic Banking*

1. What is a BANK payment card?

A payment card is a type of a payment instrument on which information is electronically recorded and used repeatedly for identification of the authorized users of payment services and for remote access to a payment account and/or to preliminary set credit limit negotiated between the authorized payment service user to whom the card was issued and the payment service provider.

The payment card gives possibility for withdrawing cash through terminal devices ATM (cash teller machines) and POS /POS in a bank/, payments of services and commodities through ATM and POS /POS at merchants/, transfers between accounts through ATM as well as other references, payment and non-payment operations performed on the basis of agreement with the bank and in accordance with the offered by the bank services related to the bank account. Operations with a bank card can be performed only in person by the card holder.

2. What is a pre-paid card?

The pre-paid card is a type of a payment instrument on which electronic money is recorded or remote access to electronic money is ensured and which serves for making payment transactions. The pre-paid card is issued for a definite period and it is possible the card not to be personalized. The pre-paid card that is personalized should be used personally by the payment services user him/herself. When the pre-paid card is personalized it has a personalized security feature – PIN.

3.What kind of organizations can issue BANK PAYMENT cards?

Payment cards can be issued by banks and non bank payment institutions which are licensed by the BNB. For issuing international bank payment cards the bank should be licensed by the respective card organization.

4. What is the bank card PIN code and what does it serve for?

PIN is an abbreviation from Personal Identification Number. It is a four digit number serving as a password for access to the card and identification of the client. PIN code can be changed by the card holder and it should be kept in secret in order to prevent its misuse. At first the PIN code is generated automatically when the card is issued and it is given to the card holder in a sealed envelope and the card holder should take the necessary measures the PIN code not to be revealed by other persons. The automatically created as well as the subsequently changed PIN code should be known only by the card holder.

5. What do the ATM and POS devices serve for?

Transactions with payment cards are performed through terminal devices ATM and POS, installed on the territory of Bulgaria or in abroad. Terminal devices ATM and POS serve for a remote access through a card to the funds on the account to which the card is issued. The performance of payment operations through ATM and POS is confirmed by introducing the respective PIN code of the payment card. Payments with bank cards can be made at ATM and POS devices.

ATM /a cash teller machine/ is a machine which allows withdrawal and/or deposit of cash, payments for services, transfer of funds between payment accounts, performance of reference services as well as other payment and non-payment operations.

The POS terminal is a device where payment cards or prepaid cards are used to pay for the purchase of goods and services or to obtain cash.

6. What is a virtual POS terminal?

Transfer of funds on payment accounts or payments for goods and services via Internet, ATM terminals or digital telephones by payment or pre-paid cards operating in on-line regime are executed through virtual POS terminals.

7. What is electronic money?

Electronic money is electronically means of payment, including magnetically, stored monetary value which is a claim to the issuer and it is issued on receipt of funds for the purpose of making payment transactions, and is accepted by a natural person or legal entity other than the electronic money issuer. The electronic money can be issued by banks, electronic money institutions being licensed for issuing electronic money, the European central bank and the national central banks of the member states. The electronic money for which the issuer has provided remote access for payment operations should be stored on an account for electronic money.

8. What is electronic banking (e-banking)?

Electronic banking (e-banking) includes bank services and operations performed through a remote access of the client to his/her account as they are serviced and realized through electronic channels (e-channels) for registering and banking. E-channels according to the type of client’s access are as follows: banking through personal computer (PC), phone banking, Internet banking and mobile (GSM) banking.

Usually, the client himself/herself can perform the same bank services and non-cash operation through e-banking as those performed in the bank offices. However, it is possible, some bank services and products to be available only through e-banking but there are also some bank services and products, which can be done only in the bank offices.

*This information has only educational purpose.