Payment Systems & Cashless Technology Flashcards

What does NFC stand for in the context of cashless vending machine payments?

Answer: Near Field Communication

NFC (Near Field Communication) is the short-range wireless technology that enables contactless tap-to-pay transactions at vending machines.

What does EMV stand for in the context of chip-card payment technology used in vending?

Answer: Europay, Mastercard, and Visa

EMV stands for Europay, Mastercard, and Visa — the three companies that originally developed the global chip-card payment standard.

Which organization establishes the security standards for payment card data protection that vending operators must follow?

Answer: PCI SSC (Payment Card Industry Security Standards Council)

The PCI SSC sets PCI DSS (Payment Card Industry Data Security Standard) requirements that any merchant processing card payments, including vending operators, must follow.

What is the primary benefit of adding cashless payment capability to a vending machine?

Answer: Increases average transaction size and reduces lost sales from customers without cash

Research consistently shows that cashless-enabled vending machines see higher average transaction values and fewer abandoned sales because customers without cash can still make purchases.

What is an 'interchange fee' in the context of vending machine credit card processing?

Answer: A per-transaction fee paid to the card-issuing bank as part of processing a card payment

Interchange fees are per-transaction fees set by card networks (Visa, Mastercard) and collected by the card-issuing bank; they represent the largest component of a vending operator's card-processing cost.

In cashless vending, what is 'tokenization'?

Answer: Replacing sensitive card data with a unique non-sensitive identifier for secure transmission

Tokenization replaces a cardholder's actual card number with a random token, so even if transaction data is intercepted, the real payment credentials cannot be compromised.

Which cashless payment model requires the customer to load money onto an account or card in advance before making vending purchases?

Answer: Closed-loop prepaid system

A closed-loop prepaid system (such as a campus card or company cafeteria card) requires funds to be loaded in advance and can only be used within that specific network.