Account Information Service (AIS)
An Account Information Service enables authorised access to information from a user’s payment account with their consent.
It can be used to provide services that bring account information from one or multiple banks into another digital environment, application or platform.
AIS is different from payment initiation. While Payment Initiation Services are focused on starting a payment from a bank account, Account Information Services are focused on accessing and presenting information related to the account.
Account Information Service Provider (AISP)
An Account Information Service Provider is a regulated provider that offers Account Information Services.
With the user’s permission, an AISP can access certain account information from banks or other account servicing payment service providers.
AISPs are commonly used in financial applications, account aggregation services, personal finance tools and other products that rely on access to bank account information.
Account-to-Account Payment (A2A)
An account-to-account payment, commonly referred to as an A2A payment, is a payment where funds move from one bank account to another.
A2A payments can be used in different contexts, including traditional bank transfers, instant payments and Open Banking payment journeys.
In a Pay by Bank experience, A2A payments allow customers to use their existing bank account as the payment source, without relying on card details.
Acquirer
An acquirer is a financial institution or payment provider that enables merchants to accept card payments.
In a traditional card payment flow, the acquirer connects the merchant with the card payment network and helps process the transaction.
Acquiring is primarily associated with card payments and is different from Open Banking payment initiation, where a payment is initiated directly from a bank account.
An API, or Application Programming Interface, allows different software systems to communicate with each other.
In the payments industry, APIs are widely used to connect merchants, payment service providers, banks and fintech platforms.
A payment API can allow a business to create payment journeys, exchange transaction information, receive payment status updates and integrate payment functionality directly into existing systems.
API Request
An API request is a message sent by one software system to another through an API.
The request usually contains the information needed for a specific action to be performed.
For example, a payment platform may send an API request containing information about an amount, currency or transaction reference in order to create a new payment journey.
API Response
An API response is the information returned by a system after an API request has been received and processed.
A response may contain status information, identifiers, payment details or instructions required for the next stage of a payment flow.
API responses allow connected systems to understand what happened after a request and determine what action should happen next.
Authentication
Authentication is the process of verifying that a user is who they claim to be or has the authority to access an account.
In a Pay by Bank journey, authentication typically takes place through the customer’s banking environment.
The exact authentication method depends on the bank and may involve a banking application, password, PIN, biometric verification or another supported authentication method.
Authorisation
Authorisation is the customer’s approval for a particular payment or action to proceed.
Authentication and authorisation are related but different concepts.
Authentication verifies the customer or their authority to access the account, while authorisation confirms that the customer approves the specific payment or action.
Bank Authentication
Bank authentication is the process through which a bank verifies a customer before allowing access to account functionality or approving certain actions.
The method used can vary between banks and markets.
It may involve a banking application, password, PIN, biometric authentication, confirmation on a trusted device or another form of secure verification.
Bank Connectivity
Bank connectivity describes the technical infrastructure that allows payment and financial applications to interact with banks.
In an Open Banking environment, bank connectivity makes it possible to build payment and account-information experiences across multiple financial institutions.
For businesses, this connectivity can reduce the need to build and maintain separate technical integrations with every individual bank.
Bank Payment
A bank payment is a payment made using funds from a bank account.
Unlike a card payment, a Pay by Bank transaction uses the customer’s bank account as the payment source.
The customer usually selects their bank, authenticates through their banking environment and authorises the payment.
Beneficiary
The beneficiary is the person or business intended to receive the funds from a payment.
In a commercial transaction, the beneficiary will often be the merchant, service provider or another business receiving the payment.
The beneficiary information may form part of the payment instruction created during the payment journey.
Checkout
Checkout is the stage of an online purchase where the customer reviews the transaction and selects how they want to pay.
A checkout may include different payment methods such as cards, digital wallets and bank payments.
Pay by Bank can be offered as an additional payment option within the checkout experience.
Consent
Consent is the permission given by a user for a specific action or service.
Consent is an important principle in Open Banking.
For example, a customer may provide consent for a payment to be initiated from their bank account or for certain account information to be accessed.
Conversion
In e-commerce and payments, conversion generally refers to a customer successfully completing a desired action, such as finishing a purchase.
The payment experience can be one of many factors influencing conversion.
A clear and simple payment journey can help reduce unnecessary friction during checkout.
Creditor
A creditor is the party to whom money is owed or transferred.
In many payment situations, the merchant or business receiving a payment can be considered the creditor.
The creditor’s account information may form part of the payment instruction.
Debtor
A debtor is the party making or owing a payment.
In a typical consumer transaction, the debtor is the customer making the payment from their bank account.
The debtor’s bank account is the source from which the payment is initiated.
Direct Bank Payment
A direct bank payment generally refers to a payment made directly from a customer’s bank account.
Unlike a card payment, the customer does not need to manually enter card details.
The exact payment journey can vary depending on the bank, market and payment infrastructure used.
Embedded Payments
Embedded payments are payment capabilities built directly into another digital product or customer experience.
Instead of sending users to a completely separate payment environment, a business can integrate payment functionality into its own platform, application or service.
Embedded payments are commonly used by fintech companies, marketplaces and software platforms.
Endpoint
An endpoint is a specific location within an API through which one software system communicates with another.
Different endpoints can be used for different types of actions.
For example, one endpoint may be used to create a payment while another may be used to retrieve payment information.
Fintech
Fintech is short for financial technology.
The term is commonly used to describe companies and products that use technology to provide or enable financial services.
Fintech covers many areas, including payments, banking technology, lending, financial management, embedded finance and financial infrastructure.
Funds
Funds generally refer to money that is available within an account or transferred as part of a financial transaction.
In payment terminology, funds may refer to the money being sent by the payer or received by the beneficiary.
Instant Payment
An instant payment is a bank transfer designed to make funds available to the recipient within seconds, subject to the rules and availability of the underlying payment system.
Instant payments and Open Banking are related but are not the same thing.
Open Banking can provide the customer-facing mechanism for initiating a payment, while an instant payment scheme may provide the underlying infrastructure for transferring the funds.
Integration
An integration is the technical connection between different systems.
In payments, integration can connect a merchant checkout, payment platform or fintech application with payment functionality.
A successful integration allows different systems to exchange information and support the required payment journey.
Merchant
A merchant is a business that sells goods or services and accepts payments from customers.
Merchants can offer multiple payment methods, including cards, digital wallets, bank payments and other electronic payment options.
Merchant Checkout
A merchant checkout is the customer-facing environment where payment takes place during a purchase.
It may be part of a website, mobile application or another digital interface.
The checkout is typically where the customer chooses a payment method and begins the payment journey.
Open Banking is a framework that allows regulated services to interact with certain bank account functionality with the customer’s permission.
In payments, Open Banking can allow a customer to select their bank, authenticate and authorise a payment directly from their bank account.
For businesses, Open Banking creates opportunities to build new digital payment experiences based on direct bank connectivity.
An Open Banking API is an interface that enables authorised communication between financial institutions and approved third-party services.
These APIs can support services such as payment initiation and access to account information.
The exact functionality depends on the bank, market and regulatory framework.
An Open Banking payment is a payment journey that uses Open Banking infrastructure to initiate a payment from a customer’s bank account.
The customer typically selects their bank, authenticates and authorises the payment through their banking environment.
Open Banking provider is a broad commercial term used for companies providing technology or regulated services related to Open Banking.
The exact role of a provider can vary significantly.
Some companies may provide regulated payment services, while others may provide technical infrastructure or operate as part of a wider payment ecosystem.
Pay by Bank
Pay by Bank is a digital payment experience that allows customers to pay using their bank account.
A typical journey allows the customer to select their bank, authenticate through their banking environment and authorise the payment.
For businesses, Pay by Bank provides another payment option that can be integrated into checkout, payment platforms or digital products.
Payer
The payer is the person or organisation making the payment.
In a typical online purchase, the payer is the customer who authorises the payment from their bank account.
Payment API
A Payment API allows software systems to interact with payment functionality.
Businesses can use payment APIs to create payment journeys, exchange transaction information and automate payment-related processes.
Payment APIs are an important part of modern payment infrastructure.
Payment Confirmation
Payment confirmation is information indicating that a particular stage or outcome of a payment has been reached.
The exact meaning of a confirmation depends on the payment flow.
It is important to distinguish between payment initiation, authorisation, processing and final settlement.
Payment Initiation
Payment initiation is the process of starting a payment from a payment account following the customer’s request and authorisation.
In an Open Banking payment journey, payment initiation allows the customer to begin a bank payment through a digital payment experience.
Payment Initiation Service (PIS)
A Payment Initiation Service is a regulated payment service involving the initiation of a payment order at the request of a payment service user in relation to a payment account held with another payment service provider.
Payment Initiation Services form an important part of the regulatory framework behind many Pay by Bank experiences.
Payment Initiation Service Provider (PISP)
A Payment Initiation Service Provider is a payment service provider authorised to provide Payment Initiation Services.
A PISP can facilitate payment initiation from a user’s payment account, subject to the applicable regulatory requirements and the user’s authorisation.
Payment Journey
A payment journey describes the complete sequence of steps a customer and connected systems move through when making a payment.
For Pay by Bank, this can include choosing a payment method, selecting a bank, authenticating, authorising the payment and returning to the merchant or application.
Payment Link
A payment link is a URL that directs a customer to a payment experience connected to a specific payment request.
Businesses can use payment links to request payments outside a traditional checkout.
For example, a payment link can be shared through email or another communication channel.
Payment Method
A payment method is the mechanism a customer chooses to use when paying for goods or services.
Examples include payment cards, bank payments, digital wallets and other electronic payment methods.
Payment Service Provider (PSP)
A Payment Service Provider is an organisation that provides payment-related services to consumers or businesses.
The term can refer to different types of businesses across the payments ecosystem, depending on the services they provide.
Payment Status
Payment status describes the current state of a payment or payment journey.
Status information can help connected systems understand what has happened and determine what action should happen next.
Payment Status Update
A payment status update communicates a change in the state of a payment.
Businesses can use payment status updates to automate internal actions, update orders or progress a customer journey.
PSD2 is the commonly used abbreviation for the European Union’s revised Payment Services Directive.
Among other things, PSD2 introduced and developed regulatory requirements around services such as Payment Initiation Services and Account Information Services.
It played an important role in the development of Open Banking across Europe.
Redirect
A redirect moves a customer from one digital environment to another.
In an Open Banking payment journey, a redirect may be used to move a customer from the merchant environment to the appropriate bank authentication environment and back again.
Refund
A refund is the return of money following a payment.
The way refunds are handled depends on the payment method, payment provider and original transaction flow.
Reconciliation
Payment reconciliation is the process of matching payment information with internal business records.
These records may include orders, invoices, customer accounts or accounting entries.
Automated payment information can help businesses connect transactions with the correct internal records.
Reference
A payment reference is information used to identify or associate a payment with another record.
For example, a business may use a payment reference to connect a transaction with an order, invoice or internal identifier.
Sandbox
A sandbox is a testing environment that allows developers to build and evaluate an integration without using the live production environment.
It can help technical teams understand payment journeys and validate how their systems respond before launch.
SEPA stands for the Single Euro Payments Area.
It provides common standards and payment schemes for euro payments across participating European countries and territories.
SEPA Credit Transfer (SCT)
SEPA Credit Transfer is a payment scheme used for euro credit transfers between accounts within the Single Euro Payments Area.
It allows euro payments to be sent between participating banks using standardised rules and formats.
SEPA Instant Credit Transfer (SCT Inst)
SEPA Instant Credit Transfer is a payment scheme designed for euro payments where funds can be made available to the recipient within seconds.
Availability depends on participation in the relevant payment scheme and supporting infrastructure.
Settlement
Settlement is the stage at which the financial obligations associated with a payment are completed between the relevant parties.
Settlement should be distinguished from earlier stages such as payment creation, customer authorisation or payment initiation.
Strong Customer Authentication (SCA)
Strong Customer Authentication is an authentication requirement used in European payments.
It is based on the use of multiple independent authentication elements.
Customers may experience Strong Customer Authentication through combinations involving a banking application, trusted device, password, PIN or biometric authentication.
Transaction
A transaction is an individual financial operation or payment activity.
Within payment systems, a transaction record can contain information used to identify and follow a payment through its lifecycle.
Transaction Reference
A transaction reference is an identifier connected to a particular transaction.
Businesses can use transaction references to connect payment activity with internal records such as orders or invoices.
Webhook
A webhook is a mechanism that allows one software system to automatically send information to another when a specific event occurs.
In payment integrations, webhooks are often used to notify connected systems when the status of a payment changes.
This allows businesses to automate actions without repeatedly checking for updates manually.
Still exploring bank payments?
Understanding the terminology is only the first step.
Modern bank payments combine financial infrastructure, APIs, authentication and customer experience into a single payment journey. For merchants, PSPs and fintech companies, understanding how these components work together can help when evaluating new payment methods and building payment experiences around Open Banking.
Wetapo is focused on making Pay by Bank and account-to-account payments easier for businesses to understand, integrate and use within modern digital products.
Explore how Pay by Bank can fit into your checkout, payment platform or fintech product and discover a simpler way to connect customers with bank payments.