ETA CPP Study Guide – Certified Payments Professional
Exam Prep
Comprehensive study guide for the ETA Certified
Payments Professional (CPP) exam, covering all key
concepts in payment processing, merchant services,
transaction types, risk management, compliance
standards, fees, interchange pricing, and terminal
technologies.
Latest Updated Exam Study Guide 2025/2026.
NABU, APF and FANF - ansMasterCard implemented a new fee, the Network Access and
Brand Usage fee (NABU). And following right on the heels of the MasterCard
announcement, on July 1, 2009 Visa implemented their U.S. Acquirer Processing Fee (APF).
Card brand dues and assessments - ansIn addition to Interchange, each card brand includes
additional fees based on the transaction amount and per transaction. These fees are called
dues and assessments and typically range from 0.105% - 0.45% on the transaction amount [
$0.0025 - $0.04.] Like interchange, assessments are exactly the same for all credit card
processors and no processor can give you a lower rate or a better deal on assessments.
AVS and switch fees - ansThe fee is charged when your business utilizes the Address
Verification Service to check that the address provided by a cardholder matches the address
on file with the credit card company.
Authorization fee - ansThe voice authorization fee applies when you use a telephone dial-up
service for transaction authorization. A fee is charged for each call that is made. Voice
authorization is useful in the event your terminal or software malfunctions or your internet
connection isn't working.
Batch fee - ansA fee that is charged when you settle your daily transactions (also known as
the batch) with your credit card processor. If you have no credit card transactions to settle on
a particular day, you are not charged this fee.
Clearing and settlement fees - ansclearing denotes all activities from the time a commitment
is made for a transaction until it is settled.
Chargeback and representment fees - ansIn short, a chargeback is a reversal of funds
transferred.
Statement or reporting fees - ansFees that are charged for receiving statements or reports.
Rewards Cards - ansA cashback reward program is an incentive program operated by credit
card companies where a percentage of the amount spent is paid back to the card holder.
Card Not Present transactions - ansA card not present transaction (CNP, MO/TO, Mail Order
/ Telephone Order, MOTOEC) is a payment card transaction made where the cardholder does
not or cannot physically present the card for a merchant's visual examination at the time that
an order is given and payment effected.
Quick Service Restaurants (QSR) - ansa specific type of restaurant that serves fast food
cuisine and has minimal table service.
Emerging Markets - anscountries in the process of rapid growth & industrialization
Level 1 Data - ansLevel I purchasing card data includes the same information captured during
a traditional credit card purchase transaction. This includes: total purchase amount, date,
merchant category code and supplier/retailer name.
Level 2 Data - ansLevel II purchasing card data includes the same information captured at
Level I, plus the following: sales tax amount, customer's accounting code, merchant's tax ID
number, applicable minority - and women-owned business status and sales outlet ZIP code.
Level 3 Data - ansLevel III purchasing card data includes the same information captured at
Levels I and II, plus the following: quantities, product codes, product descriptions, ship to
ZIP, freight amount, duty amount, order/ticket number, unit of measure, extended item
,ETA CPP Study Guide – Certified Payments Professional
Exam Prep
Comprehensive study guide for the ETA Certified
Payments Professional (CPP) exam, covering all key
concepts in payment processing, merchant services,
transaction types, risk management, compliance
standards, fees, interchange pricing, and terminal
technologies.
Latest Updated Exam Study Guide 2025/2026.
amount, discount indicator, discount amount, net/gross indicator, tax rate applied, tax type
applied, debit or credit indicator and alternate tax identifier.
Discount Rate (Credit/Debit) - ansThe discount rate is the fee paid by merchants to credit
card processors as a fee associated with accepting general-use credit cards (such as Visa,
MasterCard, American Express and Discover). Typically this fee runs between 1 percent and
3 percent, depending on the nature of the transaction.
Daily or monthly discount - ansWith monthly discount, your processor deducts fees from
your account in one lump sum once a month. With daily discount, your processor charges
fees daily throughout the month as well as at the end of the month.
Surcharge - ansA charge added to the usual cost
Billback - ansBillback or bill back is an accounting service and/or suite of software that is
used for cost recovery.
ERR Rates - ansEnhanced Rate Recovery Pricing. As a merchant business with an ERR rate
of 1.69% for your merchant account, you will be charged 1.69% for any transaction that
qualifies on The Interchange Table at 1.69% or below.
Interchange Plus - ansInterchange Plus pricing gets its name based on the fact that the rate
charged for the transaction comes straight from the Interchange table "plus" a surcharge
amount.
Tiered - ansTiered pricing gets its name from the fact that there are multiple tiers set up to
determine the price associated with the transaction.
Sales Volume - ansThe quantity or number of goods sold or services sold in the normal
operations of a company in a specified period.
Transaction Counts - ansthe total number of transactions that are processed within a merchant
account.
Average Ticket - ansAverage ticket is a metric that provides details on the average amount of
sales by a given customer. It is used by a range of businesses when analyzing business
performance and sales activity.
Authorization Fees - ansThe amount of money that is charged directly to an individual
merchant account each time communication is made between credit card processing software
(when the sale transaction is processed online, etc.) or point of sale (POS) terminal (when the
sale transaction is processed physically in person) and the authorizing network.
Effective rate - ansThe effective rate of a credit card processing statement is the total
processing fees divided by total sales volume.
Batches - ansBatch credit card processing is the practice of a merchant processing all of its
authorized credit card transactions for the day after the close of business or at a time
determined by the credit card processor.
Chargeback Activity - ansA chargeback is a transaction reversal meant to serve as a form of
consumer protection from fraudulent activity committed by both merchants and individuals.
PCI Compliance - ansThe Payment Card Industry Data Security Standard (PCI DSS) is a set
of security standards designed to ensure that ALL companies that accept, process, store or
transmit credit card information maintain a secure environment.
,ETA CPP Study Guide – Certified Payments Professional
Exam Prep
Comprehensive study guide for the ETA Certified
Payments Professional (CPP) exam, covering all key
concepts in payment processing, merchant services,
transaction types, risk management, compliance
standards, fees, interchange pricing, and terminal
technologies.
Latest Updated Exam Study Guide 2025/2026.
Internet Gateways - ansa merchant service provided by an e-commerce application service
provider that authorizes credit card or direct payments processing for e-businesses, online
retailers, bricks and clicks, or traditional brick and mortar. The payment gateway may be
provided by a bank to its customers, but can be provided by a specialized financial service
provider as a separate service, such as a payment service provider.
Virtual Terminals - ansthe web version of a physical credit card terminal or Point-of-Sale
(POS) machine
Dial-up POS System - ansUses a dial-up connection to process payments
Gift and/or Loyalty cards - ansLoyalty programs are structured marketing strategies designed
by merchants to encourage customers to continue to shop at or use the services of businesses
associated with each program.
Check conversion - ansCheck conversion is a reformatting service offered by banking
merchants. Check conversion allows banks to convert paper checks into electronic ones and
then send them to the appropriate receiving bank. The electronic check is forwarded on via
the automated clearing house (ACH).
Cash advances - ansA cash advance allows you to use your credit card to get a short-term
cash loan at a bank or ATM. Unlike a cash withdrawal from a bank account, a cash advance
has to be paid back — just like anything else you put on your credit card. Think of it as using
your credit card to "buy" cash rather than goods or services.
ACH - ansAutomated Clearing House (ACH) is an electronic network for financial
transactions in the United States. ACH processes large volumes of credit and debit
transactions in batches.
The following information must be provided on the merchant application: - ans- business
name (DBA)
- physical location address
- business telephone number
- Tax Identification Number (TIN)
- Employer Identification Number (EIN)
- Contact information
- Cardholder Storage
- Copy of the merchant's voided check or bank letter with account name, account number and
routing number
- A bank contact name and phone
Retail - ansthe selling of goods directly to the customer; face-to-face transaction
Restaurant - ansan eating establishment where food and drink are being sold to customers
Mail Order/Telephone Order (MOTO) or Internet - ansthe selling of goods online; non-face-
to-face transaction (ANY Card Not Present environment)
Supermarket - anslarge self-service retail store selling food and household goods
Lodging - anssleeping accommodations, furnished rooms to rent for the night
Landline terminal - ansthe card is swiped through a magnetic strip on the terminal, which
connects to the processor's computer.
, ETA CPP Study Guide – Certified Payments Professional
Exam Prep
Comprehensive study guide for the ETA Certified
Payments Professional (CPP) exam, covering all key
concepts in payment processing, merchant services,
transaction types, risk management, compliance
standards, fees, interchange pricing, and terminal
technologies.
Latest Updated Exam Study Guide 2025/2026.
Dial UP Terminal - ansA terminal that can read the track data on a magnetic stripe and
communicate transaction information to the frontend platform and receives authorization
instructions via the merchant's phone line usually by dialing a toll free number.
IP Terminal - ansdoes the same thing as a dial terminal except that the terminal
communicates transaction information to the frontend platform and receives authorization
instructions by utilizing the merchant's connection to the internet.
EMV Terminal - anshas the ability to take cardholder data from a chip embedded within the
card and communicate transaction information to the frontend platform and receives
authorization instructions by utilizing the merchant's phone line or Inter- net connection.
Wireless terminal - ansprovides the ideal solution for businesses seeking the most effective
way to complete credit card transactions off-site. Most wireless credit card terminals support
credit and debit transactions and are equipped with an internal PIN pad. Wireless terminals
can be used on the countertop or in a mobile environment.
Sale - ansfor a sale, swipe the customer card or manually enter the credit card number, input
sale amount, then press enter. The terminal will then transmit information through the
network for approval, and a merchant receipt will be printed.
Mobile solution - ansallows a merchant to accept credit cards using a cell phone with or
without a card swipe mechanism.
Internet solution - ansa processing method using a secure web server that provides an
interface for merchant websites and shopping carts that require real-time transaction
processing. Depending on the merchant's software they can connect to a frontend via either
an SSL server or payment gateway to get a real-time credit card authorization.
PIN pad - ansan electronic device used in a debit or smart card-based transaction to input and
encrypt the cardholder's PIN (personal identification number). The PIN pad is required so
that the customer's card can be accessed and the PIN can be securely entered and encrypted
before it is sent to the transaction manager of the switch or the bank.
Check reader - ansa payment automation device that reads the MICR (Magnetic Ink
Character Recognition) information on checks.
Contactless reader - ansany pocket-sized card with embedded integrated circuits that can
process and store data and communicate with a terminal via radio waves.
Void Last Sale - ansto void the last sale, press the screen button next to void, choose last,
verify transaction information on the display screen, then press enter. The transaction will be
voided and a receipt showing the void will be printed.
Credit / refund - ansto credit a refund, press the screen button next to refund, swipe the
customer card, input return amount, press enter, and print merchant receipt.
Header Information - ansmerchant's business information
Deposit Information - ansdaily account of the month's transaction information
Deposit Item Summary - ansa summary of the month's transactions
Settlement/Discount - ansthe month's transactions sorted by card type and fees associated
Surcharges - ansdowngraded transactions
Exam Prep
Comprehensive study guide for the ETA Certified
Payments Professional (CPP) exam, covering all key
concepts in payment processing, merchant services,
transaction types, risk management, compliance
standards, fees, interchange pricing, and terminal
technologies.
Latest Updated Exam Study Guide 2025/2026.
NABU, APF and FANF - ansMasterCard implemented a new fee, the Network Access and
Brand Usage fee (NABU). And following right on the heels of the MasterCard
announcement, on July 1, 2009 Visa implemented their U.S. Acquirer Processing Fee (APF).
Card brand dues and assessments - ansIn addition to Interchange, each card brand includes
additional fees based on the transaction amount and per transaction. These fees are called
dues and assessments and typically range from 0.105% - 0.45% on the transaction amount [
$0.0025 - $0.04.] Like interchange, assessments are exactly the same for all credit card
processors and no processor can give you a lower rate or a better deal on assessments.
AVS and switch fees - ansThe fee is charged when your business utilizes the Address
Verification Service to check that the address provided by a cardholder matches the address
on file with the credit card company.
Authorization fee - ansThe voice authorization fee applies when you use a telephone dial-up
service for transaction authorization. A fee is charged for each call that is made. Voice
authorization is useful in the event your terminal or software malfunctions or your internet
connection isn't working.
Batch fee - ansA fee that is charged when you settle your daily transactions (also known as
the batch) with your credit card processor. If you have no credit card transactions to settle on
a particular day, you are not charged this fee.
Clearing and settlement fees - ansclearing denotes all activities from the time a commitment
is made for a transaction until it is settled.
Chargeback and representment fees - ansIn short, a chargeback is a reversal of funds
transferred.
Statement or reporting fees - ansFees that are charged for receiving statements or reports.
Rewards Cards - ansA cashback reward program is an incentive program operated by credit
card companies where a percentage of the amount spent is paid back to the card holder.
Card Not Present transactions - ansA card not present transaction (CNP, MO/TO, Mail Order
/ Telephone Order, MOTOEC) is a payment card transaction made where the cardholder does
not or cannot physically present the card for a merchant's visual examination at the time that
an order is given and payment effected.
Quick Service Restaurants (QSR) - ansa specific type of restaurant that serves fast food
cuisine and has minimal table service.
Emerging Markets - anscountries in the process of rapid growth & industrialization
Level 1 Data - ansLevel I purchasing card data includes the same information captured during
a traditional credit card purchase transaction. This includes: total purchase amount, date,
merchant category code and supplier/retailer name.
Level 2 Data - ansLevel II purchasing card data includes the same information captured at
Level I, plus the following: sales tax amount, customer's accounting code, merchant's tax ID
number, applicable minority - and women-owned business status and sales outlet ZIP code.
Level 3 Data - ansLevel III purchasing card data includes the same information captured at
Levels I and II, plus the following: quantities, product codes, product descriptions, ship to
ZIP, freight amount, duty amount, order/ticket number, unit of measure, extended item
,ETA CPP Study Guide – Certified Payments Professional
Exam Prep
Comprehensive study guide for the ETA Certified
Payments Professional (CPP) exam, covering all key
concepts in payment processing, merchant services,
transaction types, risk management, compliance
standards, fees, interchange pricing, and terminal
technologies.
Latest Updated Exam Study Guide 2025/2026.
amount, discount indicator, discount amount, net/gross indicator, tax rate applied, tax type
applied, debit or credit indicator and alternate tax identifier.
Discount Rate (Credit/Debit) - ansThe discount rate is the fee paid by merchants to credit
card processors as a fee associated with accepting general-use credit cards (such as Visa,
MasterCard, American Express and Discover). Typically this fee runs between 1 percent and
3 percent, depending on the nature of the transaction.
Daily or monthly discount - ansWith monthly discount, your processor deducts fees from
your account in one lump sum once a month. With daily discount, your processor charges
fees daily throughout the month as well as at the end of the month.
Surcharge - ansA charge added to the usual cost
Billback - ansBillback or bill back is an accounting service and/or suite of software that is
used for cost recovery.
ERR Rates - ansEnhanced Rate Recovery Pricing. As a merchant business with an ERR rate
of 1.69% for your merchant account, you will be charged 1.69% for any transaction that
qualifies on The Interchange Table at 1.69% or below.
Interchange Plus - ansInterchange Plus pricing gets its name based on the fact that the rate
charged for the transaction comes straight from the Interchange table "plus" a surcharge
amount.
Tiered - ansTiered pricing gets its name from the fact that there are multiple tiers set up to
determine the price associated with the transaction.
Sales Volume - ansThe quantity or number of goods sold or services sold in the normal
operations of a company in a specified period.
Transaction Counts - ansthe total number of transactions that are processed within a merchant
account.
Average Ticket - ansAverage ticket is a metric that provides details on the average amount of
sales by a given customer. It is used by a range of businesses when analyzing business
performance and sales activity.
Authorization Fees - ansThe amount of money that is charged directly to an individual
merchant account each time communication is made between credit card processing software
(when the sale transaction is processed online, etc.) or point of sale (POS) terminal (when the
sale transaction is processed physically in person) and the authorizing network.
Effective rate - ansThe effective rate of a credit card processing statement is the total
processing fees divided by total sales volume.
Batches - ansBatch credit card processing is the practice of a merchant processing all of its
authorized credit card transactions for the day after the close of business or at a time
determined by the credit card processor.
Chargeback Activity - ansA chargeback is a transaction reversal meant to serve as a form of
consumer protection from fraudulent activity committed by both merchants and individuals.
PCI Compliance - ansThe Payment Card Industry Data Security Standard (PCI DSS) is a set
of security standards designed to ensure that ALL companies that accept, process, store or
transmit credit card information maintain a secure environment.
,ETA CPP Study Guide – Certified Payments Professional
Exam Prep
Comprehensive study guide for the ETA Certified
Payments Professional (CPP) exam, covering all key
concepts in payment processing, merchant services,
transaction types, risk management, compliance
standards, fees, interchange pricing, and terminal
technologies.
Latest Updated Exam Study Guide 2025/2026.
Internet Gateways - ansa merchant service provided by an e-commerce application service
provider that authorizes credit card or direct payments processing for e-businesses, online
retailers, bricks and clicks, or traditional brick and mortar. The payment gateway may be
provided by a bank to its customers, but can be provided by a specialized financial service
provider as a separate service, such as a payment service provider.
Virtual Terminals - ansthe web version of a physical credit card terminal or Point-of-Sale
(POS) machine
Dial-up POS System - ansUses a dial-up connection to process payments
Gift and/or Loyalty cards - ansLoyalty programs are structured marketing strategies designed
by merchants to encourage customers to continue to shop at or use the services of businesses
associated with each program.
Check conversion - ansCheck conversion is a reformatting service offered by banking
merchants. Check conversion allows banks to convert paper checks into electronic ones and
then send them to the appropriate receiving bank. The electronic check is forwarded on via
the automated clearing house (ACH).
Cash advances - ansA cash advance allows you to use your credit card to get a short-term
cash loan at a bank or ATM. Unlike a cash withdrawal from a bank account, a cash advance
has to be paid back — just like anything else you put on your credit card. Think of it as using
your credit card to "buy" cash rather than goods or services.
ACH - ansAutomated Clearing House (ACH) is an electronic network for financial
transactions in the United States. ACH processes large volumes of credit and debit
transactions in batches.
The following information must be provided on the merchant application: - ans- business
name (DBA)
- physical location address
- business telephone number
- Tax Identification Number (TIN)
- Employer Identification Number (EIN)
- Contact information
- Cardholder Storage
- Copy of the merchant's voided check or bank letter with account name, account number and
routing number
- A bank contact name and phone
Retail - ansthe selling of goods directly to the customer; face-to-face transaction
Restaurant - ansan eating establishment where food and drink are being sold to customers
Mail Order/Telephone Order (MOTO) or Internet - ansthe selling of goods online; non-face-
to-face transaction (ANY Card Not Present environment)
Supermarket - anslarge self-service retail store selling food and household goods
Lodging - anssleeping accommodations, furnished rooms to rent for the night
Landline terminal - ansthe card is swiped through a magnetic strip on the terminal, which
connects to the processor's computer.
, ETA CPP Study Guide – Certified Payments Professional
Exam Prep
Comprehensive study guide for the ETA Certified
Payments Professional (CPP) exam, covering all key
concepts in payment processing, merchant services,
transaction types, risk management, compliance
standards, fees, interchange pricing, and terminal
technologies.
Latest Updated Exam Study Guide 2025/2026.
Dial UP Terminal - ansA terminal that can read the track data on a magnetic stripe and
communicate transaction information to the frontend platform and receives authorization
instructions via the merchant's phone line usually by dialing a toll free number.
IP Terminal - ansdoes the same thing as a dial terminal except that the terminal
communicates transaction information to the frontend platform and receives authorization
instructions by utilizing the merchant's connection to the internet.
EMV Terminal - anshas the ability to take cardholder data from a chip embedded within the
card and communicate transaction information to the frontend platform and receives
authorization instructions by utilizing the merchant's phone line or Inter- net connection.
Wireless terminal - ansprovides the ideal solution for businesses seeking the most effective
way to complete credit card transactions off-site. Most wireless credit card terminals support
credit and debit transactions and are equipped with an internal PIN pad. Wireless terminals
can be used on the countertop or in a mobile environment.
Sale - ansfor a sale, swipe the customer card or manually enter the credit card number, input
sale amount, then press enter. The terminal will then transmit information through the
network for approval, and a merchant receipt will be printed.
Mobile solution - ansallows a merchant to accept credit cards using a cell phone with or
without a card swipe mechanism.
Internet solution - ansa processing method using a secure web server that provides an
interface for merchant websites and shopping carts that require real-time transaction
processing. Depending on the merchant's software they can connect to a frontend via either
an SSL server or payment gateway to get a real-time credit card authorization.
PIN pad - ansan electronic device used in a debit or smart card-based transaction to input and
encrypt the cardholder's PIN (personal identification number). The PIN pad is required so
that the customer's card can be accessed and the PIN can be securely entered and encrypted
before it is sent to the transaction manager of the switch or the bank.
Check reader - ansa payment automation device that reads the MICR (Magnetic Ink
Character Recognition) information on checks.
Contactless reader - ansany pocket-sized card with embedded integrated circuits that can
process and store data and communicate with a terminal via radio waves.
Void Last Sale - ansto void the last sale, press the screen button next to void, choose last,
verify transaction information on the display screen, then press enter. The transaction will be
voided and a receipt showing the void will be printed.
Credit / refund - ansto credit a refund, press the screen button next to refund, swipe the
customer card, input return amount, press enter, and print merchant receipt.
Header Information - ansmerchant's business information
Deposit Information - ansdaily account of the month's transaction information
Deposit Item Summary - ansa summary of the month's transactions
Settlement/Discount - ansthe month's transactions sorted by card type and fees associated
Surcharges - ansdowngraded transactions
