Do your transactions reach international processing?

[Brother]

Most likely, when you previously made a payment with a card of some bank in a store, your transaction was not actually sent to any Visa or Mastercard. That is, neither Visa nor Mastekard knew anything about your operation at all.

I wrote "before", because now it is already 100% true, but before it was - "most likely".

Here's the thing.

If you have a card, for example, of "Skhoroni-bank", and you go to a store where the POS-terminal is served by "Falsh-bank", then somehow the transaction must be sent from Falshbank to Skhoroni-bank. Well, forward the confirmation back. How to organize such a trip?

There are actually two possibilities. The first is a direct agreement between Skhoroni-bank and Falshbank on the processing of transactions. The second is when each of these banks is a member of the International Payment System (MPS are abbreviated as they are) - Visa, Mastercard, JCB, UnionPay, etc. And then the Falshbank sends the transaction to the payment system, and the latter forwards the request for the transaction to the Skhoroni Bank. Skhoroni-bank checks the balance and sends a confirmation to the payment system. Further, the payment system sends this confirmation to the False Bank, and the latter already forwards the response to the POS terminal, which happily prints a check that the payment has passed. Actually, this is precisely why international payment systems arose in due time. Which at that time were just payment, then national payment, and then the business went uphill and they became international payment.

So, the Ministry of Railways takes money for this convenience, and, in general, not to say that they are very small. Banks pay for every transaction in the system. It is clear that the favorite pastime of any business, in addition to increasing sales, is to reduce operating costs. How?

At first, some banks simply joined together to forward transactions among themselves. For example, Falshbank sees that it has a lot of transactions with Save-Bank cards. Save-Bank and Falshbank come to an agreement, and begin to save money on the commissions of the Ministry of Railways. Because in this scheme, the system does not need to pay anything at all, banks drive transactions among themselves and don’t bother. And the additional profit is divided among themselves.

Then these associations (card associations) began to grow and become similar to the same MPS - i.e. there is already some kind of center where members of this organization forward transactions, and this center forwards transactions to whoever needs it. Let's call this center Hub.

Technically, it looks like this: a Skhoroni Bank card is inserted into the Falshbank terminal. The false bank sees that the card is from the Hub's bank and sends the transaction to the Hub. The hub forwards the transaction to Skhoroni-bank, etc. Everything looks exactly the same as with the Visa, only the transaction does not reach the visa. The benefit is that it is more profitable to maintain and maintain the Hub for all members of the Hub than paying money to a Visa. And for the cardholders nothing strange happens, they do not even suspect that the data does not reach the Visa.

But if a client comes to the Flshbank terminal with an ITD-24 card, which is not a member of the Hub, then either the Falshbank itself forwards the request in the usual way (via a Visa), or the Hub does it instead of the Falshbank. Everything is transparent in reality.

And then came the Federal Law "On the National Payment System". Which directly stated: absolutely all transactions within the country must be carried out through the National System of Payment Cards. Thanks to the sanctions. Where business could not agree on who would be in charge for a long time, the state created a law. Without sanctions, probably, they would not have come to an agreement for a long time.

By the way, this NSPK as a whole uses the same technologies, the same interaction schemes, etc. I’m saying - technologically we were ready for a long time.

But, as far as I know, nevertheless, according to the existing agreements, some information from the NSPK to the Ministry of Railways is still forwarded, the exchange of data is taking place. At a minimum, if the card is served abroad, the Ministry of Railways already operates there. And these MPSs must forward the transaction to the NSPK (which, in turn, sends it to the card issuing bank). A visa will not do this just like that, and therefore it is impossible to completely isolate itself from the Ministry of Railways. Something and we are forced to give them. What exactly is classified information, and I do not know.