Interoperability in Payment Card Systems: A Deep Dive into Issuers, Acquirers, and Network Operations

International Journal of Computer Science and Engineering

© 2025 by SSRG - IJCSE Journal

Volume 12 Issue 1

Year of Publication : 2025

Authors : Naga Rishyendar Panguluri

10.14445/23488387/IJCSE-V12I1P105

How to Cite?

Naga Rishyendar Panguluri, "Interoperability in Payment Card Systems: A Deep Dive into Issuers, Acquirers, and Network Operations," SSRG International Journal of Computer Science and Engineering , vol. 12,  no. 1, pp. 31-41, 2025. Crossref, https://doi.org/10.14445/23488387/IJCSE-V12I1P105

Abstract:

nteroperability within payment card systems is an extremely vital element of the payment industry. It enables transactions among diverse systems, with issuers, acquirers, payment networks, and merchants all sharing a stake in the outcome. This paper appraises such interaction and indicates what technology supports cross-border and cross-platform processing of payments. We examine the roles and responsibilities of issuers who have charge over a cardholder account. In addition, the membership organizations provide the infrastructure behind transaction authorization and communication such as Visa or MasterCard and others. By exploring the technical standards, protocols, and regulatory guidelines that govern these interactions, this study shows the challenges and importance of achieving interoperability in the payment cycle. The paper then takes up such matters as the security scheme for contactless payments, prevention of fraud, and future trends like mobile wallets and contactless payment systems or systems for integrating blockchains into financial transactions, all of which require hints at a coherent, stable environment to flourish.
        Terminology Definition: Issuers “are financial institutions, typically banks, that provide payment cards (such as credit, debit, or prepaid cards) to consumers.”. Acquirers “are banks or financial institutions that work with merchants to process payment card transactions.”

Keywords:

Interoperability, payment card systems, issuers, acquirers, payment networks, transaction security.

References:

[1] Carol Coye Benson, and Scott Loftesness, “Interoperability in Electronic Payments: Lessons and Opportunities,” CGAP Report Commissioned to Glenbrook, pp. 1-46, 2012.
[Google Scholar] [Publisher Link]
[2] Asli Demirguc-Kunt et al., The Global Findex Database 2017: Measuring Financial Inclusion and the Fintech Revolution, World Bank, pp. 1-148, 2018.
[Google Scholar] [Publisher Link]
[3] Avi Goldfarb, and Catherine Tucker, “Digital Economics,” Journal of Economic Literature, vol. 57, no. 1, pp. 3-43, 2019.
[CrossRef] [Google Scholar] [Publisher Link]
[4] Robert M. Hunt, “An Introduction to the Economics of Payment Card Networks,” Review of Network Economics, vol. 2, no. 2, pp. 80-96, 2003.
[CrossRef] [Google Scholar] [Publisher Link]
[5] Tan Soo Fun et al., "A Lightweight and Private Mobile Payment Protocol by Using Mobile Network Operator," 2008 International Conference on Computer and Communication Engineering, Kuala Lumpur, Malaysia, pp. 162-166, 2008.
[CrossRef] [Google Scholar] [Publisher Link]
[6] Sujit Chakravorti, “Theory of Credit Card Networks: A Survey of the Literature,” Review of Network Economics, vol. 2, no. 2, pp. 50-68, 2003.
[CrossRef] [Google Scholar] [Publisher Link]
[7] Codruta Boar et al., “Interoperability between Payment Systems Across Borders,” Bank for International Settlements, no. 49, 2021.
[Google Scholar] [Publisher Link]
[8] Alice Negre, and Will Cook, “Interoperability in Digital Financial Services: Emerging Guidance for Funders,” Technical Note, CGAP, pp. 1-22, 2021.
[Google Scholar] [Publisher Link]
[9] Morten L. Bech, and Jenny Hancock, “Innovations in Payments,” BIS Quarterly Review, pp. 21-36, 2020.
[Google Scholar] [Publisher Link]
[10] John P. Caskey, and Gordon H. Sellon, “Is the Debit Card Revolution Finally Here?,” Economic Review-Federal Reserve Bank of Kansas City, pp. 79-95, 1994.
[Google Scholar] [Publisher Link]
[11] African Union, “Africa Regional Integration Index Report 2019,” United Nations Economic Commission for Africa, pp. 1-48, 2019.
[Google Scholar] [Publisher Link]
[12] Qingqi Long et al., "Effects of Payment Interoperability and Noninteroperability on Platform Competition," IEEE Transactions on Engineering Management, vol. 71, pp. 13918-13935, 2024.
[CrossRef] [Google Scholar] [Publisher Link]
[13] Antonio Ruiz-Martínez, Óscar Cánovas Reverte, and Antonio F. Gómez-Skarmeta, “Payment Frameworks for the Purchase of Electronic Products and Services,” Computer Standards and Interfaces, vol. 34, no. 1, pp. 80-92, 2012.
[CrossRef] [Google Scholar] [Publisher Link]
[14] Rafael Belchior et al., “A Survey on Blockchain Interoperability: Past, Present, and Future Trends,” ACM Computing Surveys, vol. 54, no. 8, pp. 1-41, 2021.
[CrossRef] [Google Scholar] [Publisher Link]
[15] Ilham A Qasse, Manar Abu Talib, and Qassim Nasir, “Inter Blockchain Communication: A Survey,” Proceedings of the ArabWIC 6th Annual International Conference Research Track, Rabat Morocco, pp. 1-6, 2019.
[CrossRef] [Google Scholar] [Publisher Link]
[16] Peter Robinson, “Survey of Crosschain Communications Protocols,” Computer Networks, vol. 200, pp. 1-14, 2021.
[CrossRef] [Google Scholar] [Publisher Link]
[17] Gang Wang, “SoK: Exploring Blockchains Interoperability,” Cryptology ePrint Archive, pp. 1-27, 2021.
[Google Scholar] [Publisher Link]
[18] Thorsten Beck, and Augusto De La Torre, “The Basic Analytics of Access to Financial Services,” Financial Markets, Institutions & Instruments, vol. 16, no. 2, pp. 79-117, 2007.
[CrossRef] [Google Scholar] [Publisher Link]
[19] Marc Bourreau, and Jan Kraemer, “Interoperability in Digital Markets,” 2022.
[Google Scholar]
[20] Tommaso M. Valletti, and Carlo Cambini, “Investments and Network Competition,” RAND Journal of Economics, vol. 36, no. 2, pp. 446-467, 2005.
[Google Scholar] [Publisher Link]
[21] Karen Croxson et al., Platform-Based Business Models and Financial Inclusion, pp. 1-30, 2022.
[Google Scholar] [Publisher Link]
[22] Gabriela Guibourg, “Interoperability and Network Externalities in Electronic Payments,” Sveriges Riksbank Working Paper Series, no. 126, pp. 1-47, 2001.
[Google Scholar] [Publisher Link]
[23] Udo Milkau, and Jürgen Bott, “Digitalisation in Payments: From Interoperability to Centralised Models?,” Journal of Payments Strategy & Systems, vol. 9, no. 3, pp. 321-340, 2015.
[Google Scholar] [Publisher Link]
[24] Filip Covic, and Stefan Voß, “Interoperable Smart Card Data Management in Public Mass Transit,” Public Transport, vol. 11, pp. 523-548, 2019.
[CrossRef] [Google Scholar] [Publisher Link]
[25] Rosica Chejkova-Nikolov et al., “Interoperablity of Bank Statements: A Case Study,” 2015 38th International Convention on Information and Communication Technology, Electronics and Microelectronics, Opatija, Croatia, pp. 1505-1510, 2015.
[CrossRef] [Google Scholar] [Publisher Link]
[26] Cosmas Muchinguri, “Investigating Failure to Implement Contactless Payments: A Case of Near Field Communication Payment Systems in South Africa,” Master Thesis, University of Cape Town, pp. 1-101, 2016.
[Google Scholar] [Publisher Link]
[27] Qingqi Long et al., “Effects of Payment Interoperability and Noninteroperability on Platform Competition,” IEEE Transactions on Engineering Management, vol. 71, pp. 13918-13935, 2024.
[CrossRef] [Google Scholar] [Publisher Link]
[28] Manfred Männle, “Interoperable Mobile Payment—A Requirements-Based Architecture,” Wirtschaftsinformatik 2003/Band I, pp. 95-101, 2003.
[CrossRef] [Google Scholar] [Publisher Link]
[29] Urs Gasser, and John G. Palfrey, “Case Study: Digital Identity Interoperability and Einnovation,” Berkman Center Research Publication, pp. 1-49, 2007.
[CrossRef] [Google Scholar] [Publisher Link]
[30] Celene Ancalle, and Maria Gracia Garcia, “Impact of Interoperability Regulation on the Use of Digital Payments in Peru,” Graduate Institute of International and Development Studies Working Paper, No. HEIDWP02-2024, 2024.
[Google Scholar] [Publisher Link]
[31] Rainer Schamberger, Gerald Madlmayr, and Thomas Grechenig, “Components for an Interoperable NFC Mobile Payment Ecosystem,” 2013 5th International Workshop on Near Field Communication, Zurich, Switzerland, pp. 1-5, 2013.
[CrossRef] [Google Scholar] [Publisher Link]
[32] Angela N. Lawson, and Jorge Herrada, “Fit-for-Purpose Payment System Interoperability: A Framework,” FEDS Notes, 2022.
[Google Scholar] [Publisher Link]
[33] Gottfried Leibbrandt, “The Interoperability Revolution,” Journal of Payments Strategy & Systems, vol. 2, no. 1, pp. 95-106, 2007.
[Google Scholar] [Publisher Link]
[34] Tavneet Suri et al., “Mobile Money,” VoxDevLit, vol. 2, no. 2, pp. 1-33, 2023.
[Google Scholar] [Publisher Link]
[35] Ablam Estel Apeti, and Eyah Denise Edoh, “Tax Revenue and Mobile Money in Developing Countries,” Journal of Development Economics, vol. 161, 2023.
[CrossRef] [Google Scholar] [Publisher Link]
[36] Ggombe Kasim Munyegera, and Tomoya Matsumoto, “ICT for Financial Access: Mobile Money and the Financial Behavior of Rural Households in Uganda,” Review of Development Economics, vol. 22, no. 1, pp. 45-66, 2018.
[CrossRef] [Google Scholar] [Publisher Link]
[37] Serge Stéphane Ky, “Empowering Sub-Saharan Farmers: The Transformative Effect of Mobile Money in Agriculture,” SSRN, pp. 1 30, 2024.
[CrossRef] [Google Scholar] [Publisher Link]