What’s a merchant ID and how to protect it?


Each merchant has its own identifier (MID). It is necessary for a number of operations that take place within a single transaction. In this article, we will tell you what merchant number identification is, why you need it, and what you need to know about it.

What is a merchant ID?

Merchant ID is a personalized set of numbers assigned to a merchant by a payment service provider (PSP). This code is transmitted along with the buyer’s information to banks for subsequent reconciliation of data on financialtransactions. MID is required to identify the merchant’s financial activities in the course of communication with banks, payment systems, and other parties. Also, do not confuse MID with a merchant transaction identifier.

How to get the seller ID?

Each merchant receives a MID upon opening a merchant account. To get this number, you must provide a package of documents, including:

  • TIN.
  • A document confirming your job position.
  • The names of the business owners.
  • License (if needed for your business), etc.

The merchant ID number is not required when processing payments through some PSPs. However, the presence of a personal number is a general rule. Having a MID and keeping it safe is in your best interest. The number must not be allowed to fall into the hands of scammers. Therefore, never disclose the MID to a third party.

Is it possible to have multiple MIDs?

Yes, a seller can receive multiple MIDs. However, for processing normal business payments, one ID number is sufficient. In addition to the MID, there is also a terminal identification number (TID). It is assigned to each terminal that the merchant uses. However, all TIDs are grouped under one MID.

Obtaining multiple MIDs is generally required for accounting purposes. In particular, they may be helpful for enterprises that conduct several types of activities. In this case, each individual MID allows you to separately control funds from each stream.

Can a seller lose their MID number?

Unfortunately, such situations also arise. In case of loss of MID, PSP freezes any operations within the account. In this case, a complete freeze of any transactions associated with a particular MID occurs. However, there may be cases in which the MID is not lost, but certain restrictions may apply.

Funds on hold

Payment providers have the right to partially withhold funds if suspicious activity is detected. This is necessary to prevent a potential spike in chargebacks. Such measures are usually applied temporarily.

Processing freeze

If a payment freeze occurs, transactions will be processed, but you will not be able to receive money into your account. A suspension occurs when the PSP imposes a restriction on accepting payments. This is usually due to a very high chargeback rate.

Can you protect the MID?

The biggest problem for MID is chargebacks. The higher the chargeback rate, the higher the risks. Accordingly, it is necessary to deal with the root cause. Use the following methods to deal with chargebacks:

  • Fraud filters.
  • AVS.
  • CVV verification.
  • 3D security.
  • Geolocation.
  • Biometrics.

An important step towards chargeback protection is a reliable payment gateway. Therefore, special attention should be paid to its selection. PayAdmit will be glad to become your partner and take care of any risks associated with your MID. If you wonder how to get a merchant number for credit cards, we’ll be glad to assist you. 

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