Draft Capture

Draft capture, in the context of payment card transactions, refers to the process of settling transactions that have been authorized by a cardholder's bank. Essentially, it's the transfer of transaction data from the merchant to the acquirer for financial settlement. This process begins when a cardholder makes a credit or debit card transaction; the merchant's point-of-sale (POS) system captures the necessary data (the "draft") from the card and stores it temporarily. At the end of the business day, or another specified period, these stored transactions are sent in a batch to the merchant’s acquiring bank.

The acquirer then processes these transactions, ensuring that funds are transferred from the card issuing bank to the merchant’s account, effectively completing the payment cycle. This method is crucial for the timely and accurate reconciliation of funds between all parties involved and helps maintain efficient operations for businesses by confirming that transactions are finalized and funds are properly allocated.