If you do business online, chances are you have had to jump through innumerable hoops, and you may not even know why. After all, to legally engage in commerce, you have to comply with regulatory requirements. Doing that in a brick & mortar business is a challenge, but doing it online can feel like negotiating with poltergeists. In this article, our financial tracking team here at Leap Payments explains what a Merchant ID Number is, what it’s for, and answers all of the most common questions people have when they look up their Merchant ID Number online.
What is a MID, Merchant Account Number?
Every person, entity, or organization that exchanges goods or services for money on the internet has a unique merchant identification code, usually referred to as an MID, or merchant ID. The purpose of MIDs is to enable computer-controlled credit card processing systems to track and log transactions completed over the internet. If you run a business online and don’t know quite what MIDs are, please, read on.
Every merchant receives a merchant identification number in order to be able to have all of the data associated with an online transaction recorded. This is done for accounting and legal reasons. It makes it possible for transactions to be tracked, which is necessary for any money-making organization. It is also required by law in order that criminal investigations can be carried out fully, enabling both the credit processor and the legal system to protect good actors and discourage bad actors.
Merchant account numbers are mandatory, and it is possible to have one without even being aware of it. In this way, an MID is similar to an internet protocol address, or IP number. You have it so that online activity can be regulated. Some people compare it to an email address, which makes sense- but because MIDs don’t change when you change services, we think that it’s more comparable to an IP.
What You Need to Know About Your Merchant ID Number
You can think of your MID as similar to a bank account number. In fact, both numbers exist for similar reasons. Your Merchant ID Number is not a matter of public record, just like your bank account number. It can only be seen by credit processors, by you, and by other authorized persons. Therefore, no one without proper access can look your MID up and find it. This is to protect your personal information as well as that of anyone you do business with.
Possibly the one thing that makes an MID different from the other forms of identification that we’ve mentioned is that large corporations can have multiple MIDs. This makes it possible for them to leverage multiple types of tools for managing invoices to identify different products and services that are being provided by different internal aspects of the business.
For example, the Sony electronics company may have one (or more) MID for their division that produces and sells speakers, headphones, and the like. At the same time, they may have a different division that produces and sells flat screen TVs. Each of these subdivisions of the same electronics company would have its own Merchant ID Number. Look up one such number and it will bring you to the headphone side of Sony, look up the other and you get the flat-screen people.
Strictly speaking, each of these subdivisions function like a business platform all on its own. They happen to fall under the umbrella known as “Sony,” but for accounting and legal purposes, they are separate businesses. By the same token, you may start one business, enjoy fabulous success, and start another under the same corporate moniker. They may have management, branding, and even locations in common- but they can be two different business entities, and as such, they will have their own MIDs.
How do Merchant ID Numbers Work?
Any time you complete a transaction online, the credit card processor runs the transaction through a computer network. There are many such networks operating in the world, as you might imagine, and they don’t work alone. They are, in fact, closely interconnected with the front-end, customer-facing, processing facility that is associated with the card that has been used to provide the legal tender on the buyer’s end. It is also interconnected with the back-end part of systems that track the transaction all the way to settlement.
There is an initial gateway, which is activated by your MID, terminal ID numbers (TIDs), and gateway ID numbers (GID). What your merchant identification number does is identify you in a way that is both unique and deeply protected. Your TID specifies a specific profit center or location participating in the completion of transactions. The GID identifies the network gateway through which transactions are routed.
In short, your Merchant ID Number identifies you and the attached modifiers trigger confirmation data for each transaction, pinning them down to names, locations, and times of day.
Merchant ID Number Lookup
MIDs are about security, as stated, as well as accounting. They are there for the number crunchers working for payment processors to do their important work and to keep you and your customers safe from fraud to the extent possible.
Admittedly, looking up your MID can be a challenge, but there is a way to do it. One reason to do this is that it is possible to have your MID revoked. This can happen if the business entity associated with your MID has taken too many chargebacks, experienced too many incidences of funds being withheld, and/or too many processing freezes.
These are all incidents that the traditional credit card processors look at as indicators of risk. The large credit processors are extremely averse to anything that may hurt their brand identity or trigger litigation- including attempts to look up your own MID.
Leap Payments Merchant ID Number Processing
Here at Leap Payments, we specialize in helping high-risk merchants navigate the challenges specific to their industries to do business safely and reliably. We can help you find your MID without incurring the displeasure of the old-school payment processors. Get in touch today to find out more.