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Payment is a dollar amount paid on any debt or allowance. A settlement is a payment or payments that will conclude the financial obligation in full, thus finishing the agreed term and amount in total.

Payment settlement refers to the process of the issuing bank transferring funds from the cardholder's account, via a payment gateway, to the acquiring bank - the financial institution that accepts card payments on behalf of the merchant.

Payment and settlement system means the financial infrastructure that carries out payment and settlement between banks and other institutions. Since banks are the medium through which payments are made, the payment and settlement system manage the interbank transactions and settles them.

Settlement involves exchanging funds between the two banks, while clearing can end without any interbank money movement. In the clearing process, funds move between the recipient's or sender's bank account and their bank's reserves.

Payment settlement involves collecting the funds for the amount recorded for an order. For example, when using credit cards, the settlement process specifically involves contacting the payment system and collecting the required amount of funds against the credit card.

When a credit card payment is made, the banks communicate instantly via the merchant's payment gateway. However, the actual funds are not transferred at the same time. This is where the settlement process comes in. It's an interbank process where obligations are met, and funds are ultimately discharged.

What Is a Settlement Date? The settlement date is the date when a trade is final, and the buyer must make payment to the seller while the seller delivers the assets to the buyer. The settlement date for stocks and bonds is usually two business days after the execution date (T+2).

When a credit card payment is made, the banks communicate instantly via the merchant's payment gateway. However, the actual funds are not transferred at the same time. This is where the settlement process comes in. It's an interbank process where obligations are met and funds are ultimately discharged.

The first part is the clearing process in which payment information is conveyed from the payor to the payee, probably through intermediary banks. The second part is settlement in which the actual transfer of value associated with the payment order is made, generally not with cash but with a claim on a bank.

Settlement can be defined as the process of transferring of funds through a central agency, from payer to payee, through participation of their respective banks or custodians of funds.