Batch

In the context of payment processing, a batch refers to a collection of captured transactions that have been authorized and are awaiting settlement. These transactions are typically stored in a batch file and processed together at predetermined times throughout the day. Batching is a crucial part of the electronic payment cycle as it allows merchants to accumulate transactions over a period—often a business day—before sending them en masse to their payment processor or acquirer for final settlement.

The use of batches helps streamline the settlement process, reduces transaction costs, and can enhance security by minimizing the number of times a system needs to connect to a bank for processing. Multiple batches may be settled at various times during the day, depending on the merchant's business operations and the specifics of their agreement with their payment processor. This method is particularly beneficial for businesses that handle a large volume of transactions daily, allowing for efficient and organized financial management.