DEFINITION of ‘Transaction Identifier’
A unique identifier assigned by a business to each transaction made with a debit or credit card. Transaction identifiers, also called transaction IDs, are used to help businesses identify all of the components of a transaction, from the moment a card is swiped to the moment the payment goes through.
INVESTOPEDIA EXPLAINS ‘Transaction Identifier’
Business that operate on-line assign transaction identifiers to be able to track down information about a particular transaction in order to answer questions from customers and financial institutions. The transaction identifier is similar to the reference number assigned to transactions by banks, and which appear in a customer’s monthly financial statements. Transaction identifiers make it easier for companies to track individual transactions, including capturing the initial transaction, modifying an existing transaction, and providing refunds for a transaction.
Businesses use transaction identifiers to make the compiling and querying of large numbers of transactions easier to manage. These numbers are used both in written communications, such as a packing invoice, as well as electronic communication, such as a purchase confirmation email.
Transaction identifiers make it easier for customers to interact with customer service representatives as it allows the customer to communicate problems with a particular transaction by only having to list out a series of numbers and letters. For example, it is easier to discuss “purchase 123456” than it is to discuss the item purchased, the purchasers name, and the date of the transaction. The descriptive elements of the transaction are maintained in the metadata found in the business’ electronic database.
Businesses that operate a number of stores, such as big box retailers, can link the transaction identifier to a particular card terminal at a specific store. The business can use the transaction identifiers to determine if there are problems with a particular terminal, or if a particular employee ringing up purchases results in more merchandise returns being made to the store at a later time.