Payments 101 – What You Need to Know - Webinar Hosted By The Soltesz Institute with Mahmoud Ismail

The Soltesz Institute recently hosted a foundational session on card acquiring and merchant payments with Mahmoud Ismail, Chief of Staff & Head of Acquiring and Payments at Adyen for the MENA region. This session offered practical insights into how payment systems work, which players are involved, and how payment fees and risks are handled in real life.

Mahmoud brought twenty years of payment industry experience and helped us break down one of the most misunderstood areas of financial operations and how transactions actually work.

Who’s Who in Card Transactions

At the core of every card transaction are several key parties: the cardholder, their bank (issuer), the merchant, the merchant’s bank (acquirer), the card schemes (Visa, Mastercard, etc.), and the payment gateway. Mahmoud explained how these parties work together, each with a specific role.

Many business owners still confuse gateways with acquirers, but Mahmoud clarified that gateways only transmit card data to the acquirer. They don’t process the transaction or hold any risk. Meanwhile, the acquirer is responsible for collecting the money from the issuer and settling it to the merchant after deducting relevant fees.

Card Payments vs. Alternative Payment Methods

While cards are still dominant in many parts of the world, alternative payment methods have been growing quickly. Mahmoud broke these down clearly: debit cards are linked to actual money in the bank, credit cards offer spending flexibility but higher fees and risk of chargebacks, and wallets like Apple Pay and Google Pay rely on tokenised card data for safer payments.

He also highlighted the use of direct bank transfers, popular for large B2B transactions, and BNPL models, which offer consumers instalment options but introduce merchant-side risks due to overextended consumer credit.

Payment Fees and How They’re Calculated

Card processing fees remain a sore point for most merchants. Mahmoud provided clarity on what actually makes up the cost. Every transaction involves an interchange fee (paid to the issuer), a scheme fee (paid to Visa or Mastercard), and the acquirer’s margin. Depending on the provider and the model used, these may be offered as a fixed blended rate or broken down transparently as “interchange plus” pricing.

The Hidden Risks: Security, Compliance, and Fraud

Fraud risk in card payments is still high. Mahmoud made a critical distinction between authentication and fraud prevention. Many merchants mistakenly believe that having 3D Secure (like an OTP) is enough, but this only verifies the identity of the cardholder. Risk scoring systems, on the other hand, assess the transaction itself—looking at the device used, customer behaviour, spending patterns, and geography—to determine whether to approve or decline.

What’s Next in Payments?

Mahmoud shared a future-focused view on the biggest shifts coming to payments. Real-time payments (RTP), such as those introduced in Saudi Arabia, the UAE, and Egypt, are rapidly growing. These systems offer instant bank-to-bank transfers with lower fees, ideal for both merchants and consumers. While still limited in reach, RTP could become a strong alternative to cards for domestic transactions.

Despite all the new trends, Mahmoud was clear that cards aren’t disappearing. The 16-digit card number may become invisible, but the infrastructure behind it remains essential. Visa, Mastercard, and other card networks are already investing heavily in innovations like network tokenisation, cross-border real-time settlement, and embedded identity features.

The question for merchants isn’t whether to stop accepting cards but rather how to layer in other options that serve their customers better and reduce costs. That’s where strong acquirer relationships and transparent reporting become critical.

Why Merchants Need Expert Guidance

The discussion ended with a call for education. Most business owners don’t have the background to understand payment infrastructure, fraud risk, or fee structures. Many are just focused on selling their products or services. That’s why acquirers must go beyond just processing transactions and they must become strategic partners.

As Mahmoud explained, it’s not just about offering payment tools but giving merchants the insights and support needed to make better decisions. Payments are no longer a background function but they shape customer experience, influence operational risk, and directly impact profitability.

To re-watch the full webinar or visit https://solteszinstitute.com/course/payments-101ahmoud Ismail, Chief of Staff & Head of Acquiring and Payments at Adyen for the MENA region. This session offered practical insights into how payment systems work, which players are involved, and how payment fees and risks are handled in real life.

Mahmoud brought twenty years of payment industry experience and helped us break down one of the most misunderstood areas of financial operations and how transactions actually work.

Who’s Who in Card Transactions

At the core of every card transaction are several key parties: the cardholder, their bank (issuer), the merchant, the merchant’s bank (acquirer), the card schemes (Visa, Mastercard, etc.), and the payment gateway. Mahmoud explained how these parties work together, each with a specific role.

Many business owners still confuse gateways with acquirers, but Mahmoud clarified that gateways only transmit card data to the acquirer. They don’t process the transaction or hold any risk. Meanwhile, the acquirer is responsible for collecting the money from the issuer and settling it to the merchant after deducting relevant fees.

Card Payments vs. Alternative Payment Methods

While cards are still dominant in many parts of the world, alternative payment methods have been growing quickly. Mahmoud broke these down clearly: debit cards are linked to actual money in the bank, credit cards offer spending flexibility but higher fees and risk of chargebacks, and wallets like Apple Pay and Google Pay rely on tokenised card data for safer payments.

He also highlighted the use of direct bank transfers, popular for large B2B transactions, and BNPL models, which offer consumers instalment options but introduce merchant-side risks due to overextended consumer credit.

Payment Fees and How They’re Calculated

Card processing fees remain a sore point for most merchants. Mahmoud provided clarity on what actually makes up the cost. Every transaction involves an interchange fee (paid to the issuer), a scheme fee (paid to Visa or Mastercard), and the acquirer’s margin. Depending on the provider and the model used, these may be offered as a fixed blended rate or broken down transparently as “interchange plus” pricing.

The Hidden Risks: Security, Compliance, and Fraud

Fraud risk in card payments is still high. Mahmoud made a critical distinction between authentication and fraud prevention. Many merchants mistakenly believe that having 3D Secure (like an OTP) is enough, but this only verifies the identity of the cardholder. Risk scoring systems, on the other hand, assess the transaction itself—looking at the device used, customer behaviour, spending patterns, and geography—to determine whether to approve or decline.

What’s Next in Payments?

Mahmoud shared a future-focused view on the biggest shifts coming to payments. Real-time payments (RTP), such as those introduced in Saudi Arabia, the UAE, and Egypt, are rapidly growing. These systems offer instant bank-to-bank transfers with lower fees, ideal for both merchants and consumers. While still limited in reach, RTP could become a strong alternative to cards for domestic transactions.

Despite all the new trends, Mahmoud was clear that cards aren’t disappearing. The 16-digit card number may become invisible, but the infrastructure behind it remains essential. Visa, Mastercard, and other card networks are already investing heavily in innovations like network tokenisation, cross-border real-time settlement, and embedded identity features.

The question for merchants isn’t whether to stop accepting cards but rather how to layer in other options that serve their customers better and reduce costs. That’s where strong acquirer relationships and transparent reporting become critical.

Why Merchants Need Expert Guidance

The discussion ended with a call for education. Most business owners don’t have the background to understand payment infrastructure, fraud risk, or fee structures. Many are just focused on selling their products or services. That’s why acquirers must go beyond just processing transactions and they must become strategic partners.

As Mahmoud explained, it’s not just about offering payment tools but giving merchants the insights and support needed to make better decisions. Payments are no longer a background function but they shape customer experience, influence operational risk, and directly impact profitability.

To re-watch the full webinar, visit https://solteszinstitute.com/course/payments-101