API ReferenceIntegrationsKnowledge Base

Glossary

The following table lists all the commonly used terms and their definitions used in Razorpay Payments:

Term

Description

2FA (Two Factor Authentication)

2FA is an additional layer of security that helps to protect your account from unauthorized access. You need to provide an additional code when to sign in.

Arbitration

Arbitration is a chargeback that the merchant has won and is challenged again for the third time by the customer, and the card networks directly get involved. These disputes are usually costly.

Authorization

Authorization is performed when customer's payment details are successfully authenticated by the bank. The money is deducted from the customer’s account by Razorpay, but will not be settled to your account until the payment is captured, either manually or automatically. Any payment in this state is auto-refunded to the customer if it is not captured within 5 days of creation.

Captured

When the status of the payment is changed to captured by the merchant, the payment is verified as complete by Razorpay. After the capture, the amount is settled to the merchant's account as per the settlement schedule.

Checkout

Checkout is a secure, Razorpay-hosted payment form that lets the merchants collect payments quickly. It works across devices.

Merchant

An individual or company that receives payments from customers for the exchange of goods or services using the Razorpay Payment Gateway.

Dispute

A dispute is a situation where a customer or the issuing bank questions the validity of payments. It may arise due to reasons such as unauthorized charges, failure to deliver the promised merchandise or excessive charges levied by the business.

Fraud

A Fraud is a dispute is raised by the bank when it suspects a transaction to be fraudulent based on the risk analysis.

Retrieval

Retrieval is a request initiated by the customer with their issuer bank for additional information about a transaction. This is essentially a "soft" chargeback.

Chargeback

Chargeback is a refund claim initiated by the customers with their issuer banks. In such cases, the bank starts an official inquiry.

Pre-Arbitration

Pre-Arbitration is a chargeback that the merchant has won and is again challenged by the customer for the second time.

Late Authorization

Late authorization is a situation that arises when a payment is interrupted by external factors, such as network issues or technical errors at customer's or bank's end. In such cases, funds may or may not get debited from the customer's bank account, and Razorpay does not receive a payment status from the bank.

Orders

A confirmed request by one party to another to buy, sell, deliver, or receive goods or services under specified terms and conditions.

Payment Gateway

Payment Gateway is a technology used by merchants to accept payments from customers in exchange of products and services they offer to their customers.

Payment Methods

Payment Methods is any way by which customers can make payments to merchants in exchange of products or services. Following are the example of the various payment methods: Credit Cards, Debit Cards, Net Banking, Wallets, UPI and so on.

Payment Processor

A payment processor is a company that handles the credit card and debit card transactions for a business. It moves the funds from one account to another.

Payments

A money transfer made by the customer (using any payment mode, Debit Card, Credit Card and so on) in exchange of a product or service is called a Payment.

Refunds

If an amount paid by a customer for a product or service is reversed back to the customer, it is called a Refund.

Instant Refund

If an amount paid by a customer for a product or service is reversed back to the customer, it is called a Refund. Depending on the bank's processing time, it can take 5-7 business days for the refunds to reflect in the customer's bank account or card balance. In Instant Refunds, merchants can provide a refund to the customer almost instantly

Settlement

Settlement is the process where the merchants receive the money paid by their customer for a particular product or service.

Third-party verification (TPV)

Third-party verification (TPV) is a process of getting an independent party to confirm that the customer is actually requesting a change or ordering a new service or product. For example, the TPV provider may call a customer and ask a customer for his or her identity, to validate that he or she is an authorized decision-maker and to confirm the order.

Tokenization

A process through which sensitive information or data is replaced with a unique set of characters that retain all the essential information without compromising the security of sensitive information. A token is a unique digital identifier in mobile and online transactions.

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