Interchange

Categories: Banking, Trading

We’ve been vacationing in Palm Springs, California for the last few weeks, but now we’re ready to leave the desert behind and take our vacay game to Pacific Beach, San Diego. It’s a rough life, but someone has to live it.

Before we hop into our Prius and head west, we check out the route we’ll be taking and notice that there is at least one major freeway interchange in our future. A freeway interchange is basically how we get from one freeway, like Interstate 10, to another, like I-5, using a system of ramps and grade changes. Basically, we’re transferring our vehicle from one road to another, hopefully without slowing it down too much.

We point this out because, in the technology world, the term “interchange” is used pretty much the same way: it’s moving information from one computer to another without slowing it down or changing its format.

This is done via something called EDI, which stands for “electronic data interchange,” and its whole purpose in life is to make sure that interchanges happen in a speedy, smooth, predictable, cost-effective, and safe way.

Find other enlightening terms in Shmoop Finance Genius Bar(f)