A Transaction ID is a unique identifier assigned to each transaction processed through a payment gateway. This ID is used for tracking and referencing the transaction in subsequent communications, reports, and inquiries.
It helps to locate and differentiate individual transactions in a merchant’s payment history. For example, if there is a dispute or a refund request, the transaction ID is crucial in locating the specific transaction in question.
Additionally, transaction IDs are often used for reconciliation purposes, helping businesses to match transactions recorded in their accounting system with those processed by the payment gateway. This ID is also critical for auditing purposes, as it provides a clear trail of all transactions processed.
For payment processors and gateway providers, the transaction ID is key for managing and organizing the vast number of transactions that flow through their systems daily. It also aids in fraud detection and prevention, as unusual patterns or anomalies related to a specific transaction ID can be flagged for further investigation.