POS Transactions – 101.1 Transaction Overview

Detailed Breakdown of a Point-of-Sale Transaction Flow

Point-of-Sale (POS) transactions are the backbone of retail and service payments worldwide. At US Capital Private Bank, we combine industry-standard POS processes with sovereign trust-backed financial systems, ensuring every transaction is secure, compliant, and respects client autonomy.

This article provides a step-by-step explanation of how a typical POS transaction works, from cardholder initiation to final settlement.

🛒 Step 1: Customer Initiates Payment

• The cardholder presents their payment method (physical card, virtual card, or mobile wallet) to the merchant.

• The card is swiped, inserted (chip), tapped (contactless NFC), or entered manually for online transactions.

📡 Step 2: POS Terminal Reads Card Data

• The POS terminal captures critical card data:

  • Primary Account Number (PAN)

  • Expiry date

  • Card Verification Value (CVV)

  • Cryptographic data from the EMV chip (if present)

• The terminal packages this data securely for transmission.

🔐 Step 3: Transaction Authorization Request

• The POS terminal sends the payment request, including:

  • Merchant ID and location

  • Transaction amount

  • Card data and security codes

  • Terminal and transaction timestamps

• The request travels securely via the acquiring bank or payment processor to the card network (Visa, MasterCard, UnionPay, etc.).

⚙️ Step 4: Card Network Routing

• The card network validates the card issuer’s BIN (Bank Identification Number).

• Routes the authorization request to the issuer bank or trust account that backs the card.

🏦 Step 5: Issuer Bank / Trust Verifies Transaction

• The issuer verifies:

  • Card validity (active status, no blocks)

  • Available balance or credit limit

  • Fraud indicators (velocity checks, geographic match)

  • Compliance with trust rules (if the card is trust-backed)

• Based on the above, the issuer approves or declines the transaction.

✅ Step 6: Authorization Response

• The issuer sends an approval or decline message back through the card network and processor to the POS terminal.

• If approved, an authorization code is generated and logged.

🧾 Step 7: Merchant Completes Sale

• Upon approval, the merchant finalizes the sale, often printing a receipt or sending confirmation.

• The cardholder may be prompted to enter a PIN or sign as proof of authorization.

💰 Step 8: Clearing and Settlement

• At end of day or pre-agreed intervals, the merchant batches transactions and submits them for settlement.

• Funds transfer from the issuer bank/trust account to the merchant’s acquiring bank.

• Settlement can take 24-72 hours, depending on the network and currencies.

🔒 Security & Compliance Features

• EMV chip and tokenization reduce fraud risk.

• PCI-DSS standards govern all data transmission.

• Trust rules add privacy layers and non-depletion protections for sovereign clients.

• Real-time monitoring alerts to suspicious activity.

🌍 Integration with US Capital Private Bank Trusts

• Cards can be linked to Express Trust accounts, ensuring sovereign control over funds.

• Transaction limits, geo-blocking, and merchant restrictions are enforced by trust contracts.

• Clients track transactions via private portals with ledger transparency.

📚 Supporting Resources

For more on POS systems and trust-based payment technology:

🔗 https://sedm.org — Sovereignty Education and Defense Ministry

📩 Contact US Capital Private Bank

📧 Email: [email protected]
🌐 Website: https://uscapitalprivatebank.com
📞 Phone: +971529926005