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Welcome to our Glossary

Discover the terms that change the financial technology industry.

Account Funding Transaction (AFT)

An Account Funding Transaction (AFT) pulls funds from one card account in order to fund a separate account (this does not include sales transactions). AFTs are used to move funds to a digital wallet or prepaid card, transfer funds between financial accounts like CDs or IRAs, and facilitate person-to-person (P2P) money transfers.


An acquirer (sometimes known as an acquiring bank or merchant bank) is a bank or other financial institution that processes credit and debit card transactions on the behalf of a merchant. Acquirers act as the intermediary between merchants and issuer banks, allowing merchants to accept card payments from those issuing banks. In real-time payments, an acquirer is a financial institution that is approved by a network to originate real-time payment transactions (AFTs/OCTs).

Advanced Encryption Standard (AES)

Symmetric-key block cipher algorithm and US government standard for secure and classified data encryption and decryption, also known by its original name Rijndael Encryption Algorithm. In December 2001, the National Institute of Standards (NIST) approved the AES as a Federal Information Processing Standard, which specifies application of the Rijndael algorithm to all sensitive classified data.


In general, an algorithm is a finite set of instructions or rules to be followed by a computer in order to perform calculations, problem solving operations, data processing, decision making, information encryption or decryption, and automated machine learning, among others. Algorithms provide a precise list of successive instructions that detail exactly how to complete a task, from initial information input to a final output.

Anti-Money Laundering (AML)

AML refers to the standard financial, legal and compliance controls that companies and financial institutions must undertake to identify, avoid and inform the disguising funds obtained through illegal activities as legitimate. Banks and financial institutions must monitor and trace customer transactions, as well as comply with strict “Know Your Client” parameters in order to properly identify account ownership and customer identity, among others.


An application is a program designed or developed as a tool to carry out specific functions for a user or client, with the goal of facilitating certain tasks that can be complex to manage manually. There are several types of applications depending on whether they are designed for cell phones or tablets. Computer applications are known as desktop apps. At NovoPayment, we specialize in the design, development, maintenance and monitoring of applications such as digital wallets, P2P payment apps and cash management apps, among others.

Application Programming Interface (API)

APIs are the sets of programming languages, codes and messages that software systems use to communicate and exchange data with each other. An API works like a “contract” that allows interaction between different software systems by specifying the terms of the information exchange between them. API architecture allows for faster and more modular software development sinceprogrammers can use APIs to access and integrate components of different software systems. Different API “set plays” allow developers to combine and recombine functionalities and data sources to create new software products and applications. An API architecture guarantees the ability to scale in breadth and depth of software services, and its open modular nature allows businesses to swiftly modify their products to meet changing consumer demands.

API Management

API management is the set of processesto design, control, deploy and analyze APIsin a secure environment. API management should allow an API creating organization to monitor the proper functioning of applications using the APIs and make sure they are consumable by other developers. API management provides centralized control over access parameters, monetization, analytics and developer workflows, while guaranteeing that all APIs comply to different levels of corporate and security policies.

Artificial Intelligence(AI)

Artificial Intelligence (AI) refers to the diverse set of computer science disciplines that aim to build computer systems capable of intelligent, human-like behavior.These systems can simulate human intelligence by analyzing their environment and acting independently, carrying out tasks such as planning, learning, reasoning, problem solving, moving, perceiving and even socially interacting or thinking creatively. Machine learning is the subset of these disciplines through which computer systems receive supervised and non-supervised training models that allow them to increasingly process information independently. Deep learning, on the other hand, allows computer systems to access complex sets of unstructured data from diverse sources in order to learn how to make increasingly autonomous decisions. In financial technology, AI plays a fundamental role in the automation and hyper-customization of services, from fraud management through pattern detection to highly personalized credit analyses based on consumer behavior.


Authorization occurs at the point of sale, when a request is sent to a cardholder’s issuing bank for transaction approval. Often performed via a card processor, the authorization process confirms the cardholder has sufficient funds in their associated account to cover the attempted charge. Fraud prevention measures may also be performed during the authorization process. When authorization is approved, the transaction amount is put on hold in the cardholder’s account.

Automated Clearing House (ACH)

The Automated Clearing House (ACH) is an electronic funds-transfer (EFT) system run by a National Automated Clearing House Association (NACHA) that allows a network of participating financial institutions to process transactions. Typical transactions by ACH include online bill payments, direct deposits for payroll, tax refunds and payments, and more.


Automation refers to the process of transferring production tasks usually carried out by humans to a set of technological elements and tools. One of the main advantages of automation is eliminating repetitive processes and risks associated to possible human error when tasks are performed manually. Through our automation solutions, we help companies and people improve the quality of their operations and increase the precision of their data.