Settlement Assets and Obligations

12 Months Ended

Dec. 31, 2021

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Settlement assets and obligations represent intermediary balances arising from the settlement process which involves the transferring of funds between card issuers, payment networks, merchants and consumers, and collateral amounts held to manage merchant credit risk. The Company records settlement assets and obligations upon processing a payment transaction. Settlement assets represent amounts receivable from agents, bank partners, merchants and from payment networks for submitted merchant transactions, and funds received by the Company in advance of paying to merchants or payees. Settlement obligations represent the unpaid amounts that are due to merchants or payees for their payment transactions and collateral deposits.

The principal components of the Company’s settlement assets and obligations were as follows at December 31:



(In millions)	2021		2020
Settlement assets
Cash and cash equivalents	$	2,361	$	1,650
Receivables	11,291		9,871
Total settlement assets	$	13,652	$	11,521
Settlement obligations
Payment instruments outstanding	$	460	$	483
Card settlements and collateral deposits due to merchants	13,192		11,038
Total settlement obligations	$	13,652	$	11,521

The changes in settlement cash and cash equivalents are presented in settlement activity, net within financing activities in the consolidated statements of cash flows.