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If I make a payment to my credit card, how does that transaction actually happen behind the scenes?

Does money from my checking account get transferred into the credit card issuer's checking account?

What would be the difference if it's the same-institution payment (e.g. Chase bank checking --> Chase Visa), vs different institution payment (e.g. Chase bank checking --> Capital One Visa).

I'm trying to understand the mechanism of payments between these financial entities - would they be using ACH transfers, Wire transfers, or something else?

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    All credit cards are handled by a bank, the ‘Credit Card Company’ is just an intermediate. So it’s just a normal bank-to-bank transfer.
    – Aganju
    Jan 13, 2022 at 22:33

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If I make a payment to my credit card, how does that transaction actually happen behind the scenes?

Note that "credit card" isn't relevant here. The answer is the same whether you are paying your mortgage, car payment, or any payment you would make to a bank. In the end it is a bank to bank transfer.

The method used for the payment varies, depending on how you pay. Obviously if you send a check, then the normal check processing applies. I suspect most US bank to bank transfers would use ACH, and perhaps international transfers would use a wire mechanism.

Does money from my checking account get transferred into the credit card issuer's checking account?

If it's a checking account, then yes, but it may not be a checking account.

What would be the difference if it's the same-institution payment?

If the source and destination accounts are within the same bank, then it's simply an internal money transfer, not much different than if you transferred money from your checking to savings account, except that the destination account is the bank's, rather than your own.

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  • I see, the "credit card" not being relevant makes sense. The point of the question is, I would need to know the account number to make the ACH transfer to, correct? And the "account number" of the credit card is not really anywhere to be found. Is this something that the card issuer bank would potentially provide?
    – geochanto
    Jan 14, 2022 at 1:39
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    @geochanto Credit cards don't generally have individual ACH information (even behind the scenes). The bank gets paid to their ACH (or equivalent) account, and then internally adjust your balance appropriately. Just like you aren't "actually" spending your money when you use the card (you're spending the bank's money and promising to pay them back), when you pay your balance you're really just paying the bank as an entity and not putting it into your account. (Debit cards that have a credit card logo are different, and this doesn't apply.)
    – Bobson
    Jan 14, 2022 at 1:55
  • @Bobson Thanks, I was guessing that it would go to some knd of an ACH account of the bank. Just a matter of finding out what that account should be, and what other meta information would need to be submitted with the payment so that bank would know that payment was made towards a particular credit card holder for a given pay period.
    – geochanto
    Jan 14, 2022 at 3:56
  • @geochanto When you pay your CC bill with a check, you just write the bank name on the to line, and typically you would return the payment slip along with your check. That payment slip contains the meta information on it (your account number of similar ID) so they know to apply the check to your account. When you pay online, the same concept applies, and since you're already logged into your account when you pay, they know to apply that payment to your account. Note one of my doctor's online bill pay doesn't require a login- instead you just type in a name and account number when you pay.
    – TTT
    Jan 14, 2022 at 5:12

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