ANSI X9.104-1-2004 (R2023): Card Originated Messages

Customer making a credit card purchase at a retail store with the card reader adhering to ANSI X9.104-1-2004 (R2023).

The substitution of electronic financial transactions at the point of sale for their paper-based predecessors has reduced costs and improved efficiency, particularly in the operation of retail businesses. Many stores are now dependent on the use of this technology in their daily operations, which applies to credit/debit cards, various proprietary cards, including for use in specialty markets, and for emerging payment methods. ANSI X9.104-1-2004 (R2023): Financial Transaction Card Originated Messages – Card Acceptor To Acquiring Host Messages – Part 1: Messages, Data Elements And Code Values provides a generic basis for the implementation of a common message exchange infrastructure at the point of sale for use by various verticals within the retail community and their component business operations.

The ANSI X9.104 Series for Financial Transaction Messages

ANSI X9.104 consists of two parts, under the general title Financial Transaction Messages – Card Acceptor To Acquirer Messages:

  1. ANSI X9.104-1-2004 (R2023) defines the messages, data elements and code values generally used in the retail financial transaction processing environment.
  2. ANSI X9.104-2-2004 (R2023) defines specific examples of messages used in the convenience store and petroleum marketing industry.

The ANSI X9.104-1-2004 (R2023) Standard for Card Originated Messages

Part 1 of ANSI X9.104 defines a common interface for the exchange of information between point of sale systems or terminal devices located in a retail establishment and the acquiring host transaction processing system(s). Terminal devices refers to stand-alone card processors, transponders, card readers in fuel dispensers, PIN pads, electronic cash registers, and card authorization devices that are integrated with a point of sale system. Card processing and/or manual data entry may be initiated by store personnel or by the customer. Moreover, this American National Standard defines a sufficient number of message types and data elements to facilitate the exchange of all necessary information related to payment transactions originated by point of sale systems or terminal devices and automated control of the systems and devices.

Communication-related characteristics, such as protocol, header and trailer information and transmission control, are outside the scope of ANSI X9.104-1-2004 (R2023). Security techniques that may be utilized for the protection of data contained in the messages are also outside the scope of Part 1 of X9.104.

Customer making a credit card purchase at a clothing retail store with the terminal device adhering to ANSI X9.104-1-2004 (R2023).

When Did Credit and Debit Cards Become Popular?

In 1950, the Diners Club card became the first store card to gain widespread use after founder Frank McNamara was inspired to leave his wallet at home while out dining. Within two years, the Diners Club’s 200 initial members grew to 42,000 throughout the U.S., and Diner’s Club became the first credit card users could use internationally (U.K., Cuba, Canada, and Mexico). Shortly after the Diner’s Club card entered the scene, banks like American Express and Bank of America began offering the first credit cards in the 1950s and 60s to allow users to carry a credit card balance from month to month.

In 1966 a group of banks in California got together and formed the Interbank Card Association (ITC) and released Master Charge (changing its name in 1979 to Master Card). Later, in 1976, the BankAmericard changed its name to “Visa,” a word that sounded the same in nearly every language. After debuting in the late 1960s and 70s, debit cards usage sky rotted in the 1990s and 2000s. Debit card usage specifically picked up in the 1980s and 1990s when more and more automated teller machines (ATMs) started populating across the United States. In 1990, debit cards were used in about 300 million transactions.

The need for a standardized payment system became a global issue and in 1994 three international payment processors began the development of a global chip specification for payment systems. In 2009, prepaid and debit cards were used in 37.6 billion transactions; in 2022, consumer and commercial credit, debit, and prepaid cards issued in the US carrying major brands generated $9.563 trillion in purchase volume, an increase of 13.0% over 2021. 

What is an Acquiring Host, Issuing Host, and Card Acceptor in ANSI X9.104-1-2004 (R2023)?

There are three major components for the processing of transactions at the POS system/device: the card acceptor (i.e., the retail business), the acquiring host, and the card issuing host.

  • Acquiring host: the processing system which communicates with the card acceptor or a communications network processor and is responsible for receiving the data relating to a transaction and obtaining an approval or denial for the transaction.
  • Issuing host: the processing system that acts under the authority of the card issuer to receive a transaction and to approve funds to be given to the card acceptor or to guarantee

ANSI X9.104-1-2004 (R2023) specifies that the card acceptor (retail business) has a processing relationship (identification number) with an acquiring host processing system. Messages that are sent to the acquiring host contain the identity of the originating card acceptor, or in the alternative, the identity of the POS system/device. These messages are exchanged through a communications protocol, agreed to by the parties. Similarly, the messages are then exchanged between the acquiring host and the card issuing host, so that an authorization or response message may be returned from the card issuing host to the acquiring host and sent down to the card acceptor’s POS system/device. The card issuing host is responsible for approval and clearance of all transactions initiated by the card acceptor (retailer) and those messages are relayed through the acquiring host to the POS system/device.

ANSI X9.104-1-2004 (R2023): Financial Transaction Card Originated Messages – Card Acceptor To Acquiring Host Messages – Part 1: Messages, Data Elements And Code Values is available on the ANSI Webstore.

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