Introduction
A card-based transaction typically travels from a transaction acquiring device, such as a point-of-sale terminal or an automated teller machine (ATM), through a series of networks, to a card issuing system for authorization against the card holder's account. The transaction data contains information derived from the card (e.g., the account number), the terminal (e.g., the merchant number), the transaction (e.g., the amount), together with other data which may be generated dynamically or added by intervening systems. The card issuing system will either authorize or decline the transaction and generate a response message which must be delivered back to the terminal within a predefined time period.
ISO 8583 defines a message format and a communication flow so that different systems can exchange these transaction requests and responses. The vast majority of transactions made at ATMs use ISO 8583 at some point in the communication chain, as do transactions made when a customer uses a card to make a payment in a store (EFTPOS). In particular, both the MasterCard and Visa networks base their authorization communications on the ISO 8583 standard, as do many other institutions and networks. ISO 8583 has no routing information, so is sometimes used with a TPDU header.
Cardholder-originated transactions include purchase, withdrawal, deposit, refund, reversal, balance inquiry, payments and inter-account transfers. ISO 8583 also defines system-to-system messages for secure key exchanges, reconciliation of totals, and other administrative purposes.
Although ISO 8583 defines a common standard, it is not typically used directly by systems or networks. It defines many standard fields (data elements) which remain the same in all systems or networks, and leaves a few additional fields for passing network specific details. These fields are used by each network to adapt the standard for its own use with custom fields and custom usages.
The placements of fields in different versions of the standard varies; for example, the currency elements of the 1987 and 1993 versions are no longer used in the 2003 version, which holds currency as a sub-element of any financial amount element. As of writing, ISO 8583:2003 has yet to achieve wide acceptance.
An ISO 8583 message is made of the following parts:
- Message type indicator (MTI)
- One or more bitmaps, indicating which data elements are present
- Data elements, the fields of the message
Read more about this topic: ISO 8583
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