A Member Bank refers to a bank that is a member of a credit card network, such as Visa or MasterCard. These banks are authorized to issue cards and provide merchant accounts on behalf of the card networks. They are also responsible for underwriting the financial risk associated with processing credit card transactions, such as the risk of chargebacks.
Member banks play a crucial role in the payment processing ecosystem as they serve as the intermediary between the merchant and the card networks. They are responsible for settling transactions with the card networks and depositing funds into the merchant’s account.
Member banks also often provide customer service and support to merchants, helping them navigate the complexities of payment processing and ensuring they comply with all relevant rules and regulations.