Issuer (Issuing Bank)

An issuer, also known as an issuing bank, is a financial institution that provides payment cards to consumers. These cards can be credit or debit cards and are used for making cashless payments whether online (e.g., on an e-commerce website), through mobile apps, or in physical stores. The issuer is crucial within the payment ecosystem as it has several key roles and responsibilities:

The issuing bank is often referred to as the shopper's bank because it issues the cards and funds the shopper's transactions. It is distinguished from the merchant's bank, or the acquiring bank, which processes the merchant's card transactions and acquires the payments. This distinction is important for understanding the flow of funds and the relationships within the credit card processing ecosystem.

Overall, issuing banks are fundamental to the financial services industry, enabling millions of transactions daily and facilitating the widespread use of cashless payment methods globally. They provide the essential link between card networks, merchants, and consumers, ensuring the smooth execution of transactions and the security of the payment infrastructure.