Mixed Deck — All CPP Topics Flashcards
100 cards from real CPP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 20 Mixed Deck — All CPP Topics flashcards as text
What is a card-not-present (CNP) transaction?
Answer: A transaction where the physical card is not inserted into a terminal
A card-not-present (CNP) transaction occurs when the physical card is not present at the point of sale, such as in e-commerce, mail order, or phone order transactions.
What is a 'soft decline' in payment processing?
Answer: A transaction declined due to a temporary issue that may succeed if retried
A soft decline (e.g., 'insufficient funds' or 'do not honor' with retry eligibility) indicates a temporary condition, whereas a hard decline signals a permanent block.
How should progress in communication & stakeholder engagement be measured?
Answer: Through defined metrics and regular reviews
Defined metrics provide objective measurement.
What is the PRIMARY purpose of leadership & team management in permitting?
Answer: Ensuring compliance with standards
Primary purpose is compliance.
What is the primary purpose of OFAC screening in international payment processing?
Answer: To ensure transactions do not involve sanctioned individuals, entities, or countries
OFAC (Office of Foreign Assets Control) screening ensures that international payments do not involve parties or countries subject to U.S. economic sanctions, which is a legal compliance requirement.
What skill is essential for strategic planning & analysis?
Answer: Critical thinking and attention to detail
Critical thinking ensures proper execution.
What does the term 'acquiring bank' (acquirer) refer to in card processing?
Answer: The bank that processes card transactions on behalf of merchants and deposits funds into their accounts
The acquiring bank (acquirer) is the financial institution that enables merchants to accept card payments by processing transactions and settling funds into merchant accounts.
In cash management, what is a 'zero-balance account' (ZBA)?
Answer: A subsidiary account that is automatically swept to zero at end of day by transferring funds to/from a master account
A ZBA automatically sweeps its balance to zero each day, transferring excess funds up to a concentration account or drawing from it to cover disbursements, centralizing liquidity management.
What is a chargeback in fraud prevention?
Answer: It is a reversal of a transaction due to fraud or disputes
A chargeback is a reversal of a transaction, typically initiated by a customer who disputes a charge with their bank due to reasons like fraud, unauthorized transactions, or non-receipt of goods/services. In the context of fraud prevention, chargebacks highlight instances where fraud may have occurred, leading to financial losses for merchants. While they protect consumers, they also serve as an indicator for businesses to strengthen their fraud prevention measures to avoid future disputes and associated costs.
Under Nacha rules, how long does an ODFI have to honor a return entry from an RDFI?
Answer: 5 banking days
The ODFI must accept return entries transmitted within the applicable return timeframe, which for most return reasons is 2 banking days, but the ODFI has 5 banking days to dishonor improper returns.
What is the primary purpose of a payment network's BIN (Bank Identification Number) range?
Answer: To identify the issuing institution and card product associated with a card
The BIN (first 6–8 digits of a card number) identifies the issuer and card product, enabling routing, risk checks, and interchange classification.
What is an ACH payment system?
Answer: It facilitates direct bank-to-bank payments
An ACH (Automated Clearing House) payment system facilitates electronic funds transfers directly between bank accounts in the United States. Unlike card payments, ACH transactions are typically used for direct deposits, bill payments, and business-to-business transfers, offering a cost-effective and efficient method for moving money without physical checks or cards.
In a cross-border wire transfer, what is the role of a correspondent bank?
Answer: It acts as an intermediary to facilitate payments between banks that have no direct relationship
A correspondent bank acts as an intermediary financial institution that facilitates transactions between banks in different countries that do not have direct banking relationships with each other.
What is a vostro account in the context of correspondent banking?
Answer: An account held by a foreign bank at a domestic bank, denominated in the domestic currency
A vostro account (from Latin for 'yours') is an account that a foreign bank holds at a domestic bank, denominated in the domestic currency, allowing the foreign bank to offer local currency services to its customers.
What is the PRIMARY purpose of client relationship management in permitting?
Answer: Ensuring compliance with standards
Primary purpose is compliance.
How does operations & process management benefit organizations?
Answer: Improved outcomes and efficiency
Benefits include improved outcomes and efficiency.
What skill is essential for operations & process management?
Answer: Critical thinking and attention to detail
Critical thinking ensures proper execution.
How does the General Data Protection Regulation (GDPR) impact payment systems?
Answer: It ensures that customer data is protected and managed according to privacy standards
The General Data Protection Regulation (GDPR) significantly impacts payment systems by imposing strict rules on how personal data, including payment information, is collected, processed, and stored. Its core purpose is to ensure that customer data is protected and managed according to high privacy standards, giving individuals greater control over their information. Payment systems must comply by implementing robust data security measures, obtaining explicit consent, and upholding data subject rights, ensuring responsible data handling.
How do cross-border payment regulations affect international transactions?
Answer: They ensure compliance with laws and prevent illegal activities in international transactions
Cross-border payment regulations are essential for governing the flow of money between different countries, ensuring that international transactions adhere to legal frameworks. These regulations aim to prevent illicit activities such as money laundering, terrorist financing, and sanctions evasion. By establishing clear rules for reporting, verification, and compliance, they help maintain the security and integrity of the global financial system while facilitating legitimate international trade and remittances.
What does ACH stand for in the context of US payment systems?
Answer: Automated Clearing House
ACH stands for Automated Clearing House, the US electronic network used for financial transactions such as direct deposits and bill payments.