How Payments Work: The Hidden Infrastructure Behind Cards, Bank Rails, Wallets, and Modern Fintech - Hardcover

by Artem Smirnov (Author)

How can a card from one bank work almost anywhere in the world?

You tap a card, see "Approved," and walk away with a receipt. Yet in those few seconds, several institutions have exchanged messages, checked risk, reserved funds, applied rules, and created records that will later determine who gets paid.

How Payments Work explains the infrastructure behind that everyday transaction in clear, practical language.

Written for people entering payments, banking, and fintech - and for professionals who want to understand the parts of the industry beyond their own - the book explains the roles, flows, incentives, trade-offs, and failure points behind modern payment systems.

The book covers:

• Card payments - issuers, acquirers, networks, processors, gateways, PSPs, authorization, clearing, settlement, fees, disputes, and network rules.
• Cards and credentials - EMV, contactless payments, mobile wallets, tokenization, virtual cards, PINs, CVV/CVC, and 3-D Secure.
• Transaction processing - ISO 8583, authorization holds, clearing, settlement, refunds, reversals, chargebacks, reconciliation, and payment accounting.
• Security and regulation - fraud, PCI DSS, PSD2/PSD3, Strong Customer Authentication, GDPR, KYC, AML, and sanctions screening.
• Bank payment rails - ACH, SEPA, SWIFT, correspondent banking, ISO 20022, and instant payments.
• Modern fintech - digital wallets, BNPL, QR payments, open banking, account-to-account payments, neobanks, Banking-as-a-Service, embedded finance, stablecoins, CBDCs, and DeFi.

Rather than focusing on a single provider or technology, How Payments Work explains how the pieces fit together: how information moves before money does, where risk sits, and why the same transaction looks different depending on which side of the system you are on.

Whether you are starting a career in payments or already working in the industry, this book provides a practical foundation for understanding the infrastructure behind modern money movement.