Merchant Identication Number (MID)
What is a Merchant Identication Number?
When you get a merchant account, you are issued a unique Merchant Identification Number (MID) that identifies you to your processor and the banking institutions upstream which authorize transactions, and subsequently deposit money into your bank account. While some larger companies (such as resorts) may have multiple MIDs (in RDP terms this the and/or Ecomm MID) for accounting purposes, the average business owner will only have one, even if he or she has several credit card terminals.
From a technical standpoint, the MID is issued by an “acquiring bank” which backs dollars processed through your account. Merchant IDs are issued after your business is verified, usually with documentation such as the Taxpayer Identification Number and names of the principal owners. Typically, Independent Sales Organizations (ISOs) are the bridge between the acquiring bank and the merchant, as they do a lot of the heavy lifting required to satisfy the MID acquisition criteria. Should you ever switch credit card processing companies, you will be issued a new merchant id number. The process is generally seamless, and most store owners would only notice that the MID number on their statement has changed in relation to the other company data on the bill. It is important to keep your merchant ID number safe, so if you are getting your credit card processing statements reviewed by a third party, you should black out the MID number before copying or faxing the information.
While the merchant identification number may be the same for all the devices (card machines, gateways, software, etc.) used by your company, each device will have its own unique identifier. Most often this is called a Terminal Identification Number (TID) that gets communicated along with the MID during transaction processing. The advantage of this approach is that you can more easily identify issues with terminals should a problem arise. For instance, you might be able to trace a chargeback to a particular checkout counter, and then review the security footage in order to capture the suspect transaction or get more information from the cashier.