Actually accurate. "Merchant bank" is not the card holder's bank - it is the bank that actually settles transactions with the issuing bank (i.e. your credit card) and then deposits money into the merchant's actual bank account. Money flows through the merchant account. Incidentally, the merchant bank is at risk for fraudulent merchants as they are often advancing money (a few days early) to the merchant in anticipation of settling. Merchant banks can shut down merchants and they also have the power to require the merchants to leave an amount of money on deposit with them to mitigate risk.
> My bank does not offer the ability to reverse transactions or replace funds lost to merchants
Correct. Your bank does not have that power - you have to initiate a chargeback, and that is ultimately handled by the MSP. Incidentally, if you have a credit card, the issuer (often a bank) initiates the chargeback process.
Actually accurate. "Merchant bank" is not the card holder's bank - it is the bank that actually settles transactions with the issuing bank (i.e. your credit card) and then deposits money into the merchant's actual bank account. Money flows through the merchant account. Incidentally, the merchant bank is at risk for fraudulent merchants as they are often advancing money (a few days early) to the merchant in anticipation of settling. Merchant banks can shut down merchants and they also have the power to require the merchants to leave an amount of money on deposit with them to mitigate risk.
> My bank does not offer the ability to reverse transactions or replace funds lost to merchants
Correct. Your bank does not have that power - you have to initiate a chargeback, and that is ultimately handled by the MSP. Incidentally, if you have a credit card, the issuer (often a bank) initiates the chargeback process.