Card payments involve more parties than anyone expects, with overlapping names and companies that play several roles at once. Here is the map, in the order a transaction travels.

The parties

The cardholder. Your customer.

The issuing bank. The bank that gave your customer their card. It decides whether to approve the transaction and it receives interchange — the largest component of what you pay.

The card network. Visa, Mastercard, American Express, Discover. They operate the rails, set the rules, and set interchange. They collect assessments.

The acquiring bank. Your bank in this arrangement. It holds your merchant account, accepts the risk that you will fail to deliver on a sale, and deposits your money.

The processor. The company that moves the transaction between all of the above. Most of what people call "our payment company" is the processor.

The gateway. The technical connection between your checkout or terminal and the processor. It encrypts, transmits, and handles the technical side of the transaction.

The confusion is that one company frequently performs several of these functions, and markets itself under whichever name is convenient.

The journey of one transaction

Authorization takes under two seconds. The card is presented. The gateway encrypts and sends the details to the processor. The processor routes to the network, which routes to the issuing bank. The issuer checks the funds, the fraud rules and the account status, and returns an approval or a decline. That answer travels back the same path.

At this point no money has moved. The customer's available balance is reduced by a hold.

Batching happens at end of day. You submit the day's approved transactions together.

Clearing and settlement take one to three business days. The networks calculate what each party owes. Issuing banks send funds to acquiring banks, minus interchange. Your acquirer deposits the remainder, minus everything else, into your account.

Where the money goes

Of a $100 sale on a typical rewards credit card, roughly $1.80 goes to the issuing bank as interchange, roughly $0.14 to the network as assessments, and somewhere between $0.15 and $0.75 to your processor as markup depending on your arrangement. You receive approximately $97.30 to $97.90.

Interchange is the largest piece and it is fixed. The markup is the piece that is a decision.

Why this matters practically

Knowing who to call. A declined transaction is usually the issuing bank, and no amount of pressure on your processor changes it. A terminal that will not connect is a gateway issue. A missing deposit is the acquirer.

Understanding what you can change. You cannot negotiate interchange or assessments. You can negotiate markup, gateway fees and ancillary charges. Focusing effort on the negotiable portion is the whole strategy.

Evaluating a switch. Changing processors may or may not mean changing gateways, acquirers or terminals. The migration cost sits in which layers actually change, and that is the question to ask before the rate question.

Where AI Pay sits

To be precise about our own position: Maverick Payments provides the processing and acquiring infrastructure — the gateway relationships, underwriting and settlement. AI Pay is the intelligence and transparency layer above it, handling accuracy prediction, fraud monitoring and the reporting that lets a merchant see what is actually happening.

We describe it this way rather than implying we built the rails, because knowing which layer a vendor actually operates is exactly the thing this article argues you should be able to find out.