Bank Identification Number (BIN) is the number which identifies the issuer of a credit card, also known as Issuer Identification Number (IIN). Each issuing bank can issue credit and debit cards only under a BIN set for that purpose by the relevant credit card association. The BIN is used as the first 6 digits on each credit card issued, and therefore identification of credit card issuer is immediate.
Sophisticated international merchants should add BIN check within their processing workflow. The BIN check result should be used both for acquirer routing as well as for anti fraud score set.
And how will that increase the credit card processing volume at a lower risk? One question at a time… Credit card processing volume will increase as different cards, issued by different issuers will be routed, through different merchant accounts to different acquirers for processing. As different acquirers have different capabilities, risk mechanisms and preferences, some will decline 100% of a certain issuer, while others will have his cards passed with flying colors…
Regarding lower risk – use the BIN check to match issuing bank country with customer’s country address. Whenever those two don’t match, show a higher score and perform additional anti fraud checks prior to charging the card.
As funny as it may sound you don’t need to invest in sales and marketing or penetrate new markets to show an immediate improvement in your bottom line. Optimizing your credit card processing flow will immediately have the same effect – an effect you can work with on years to come!
Gidi Argov, Founder and CEO
www.CreditCardProcessing-r-us.com
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Gidi Thanks for the post. I can see what you mean by checking the BIN to match the address of your shopper. It is the other part that puzzles me! Acquirers decide not to work with certain issuers? Why?
Acquirers do not necessarily “decide” not to work with a certain issuer – the two simply don’t find the right way to communicate with one another…
Think about this example: Your US domestic acquirer performs an AVS check prior to authorizing a transaction. Some international issuers collect and maintain addresses in local language. This either totally disables or seriously disrupts any AVS check attempt, which ends with a transaction decline on virtually all the transactions sent for authorization with this international issuer. Using a local acquirer which uses better communication channels with same issuer, will not only dramatically increase the number of transactions approved, it will also bypass the cross border transaction fee that would otherwise apply.
Now you have it – BIN credit card processing optimizes your credit card processing flow in more than one way…
Thanks, just one thing, I thought that AVS is actually numeric (street number and postal code). Am I wrong?
Hi Max and good to have you back!
If you relate to Visa and MC you are correct – AVS is indeed only a numeric check of the street number and postal code of a card holder, maintained by his issuing bank.
That said, please note that American Express includes a card member’s name match within its AVS check and reports back mismatches, such as: “Card member’s name does not match, but billing postal code matches”.
One way or another most international issuers (other than USA, Canada and the UK) have major issues replying to an AVS check query, or do not support it at all.
The example provided above was simplifying/illustrating a situation which might explain this lack of AVS support or situations of AVS failure/partial match.
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