Can you block prepaid debit cards? Yes. I regularly talk with merchants requesting a way to block prepaid debit cards, especially for installment payments.  I recently discovered I’ve been lax with my terminology though. A stored-value card is usually anonymous and there is no record of who the card belongs to or who loaded money onto it; the traditional gift card. Prepaid debit cards are usually issued in the name of individual account holders and there are records of deposits. A prepaid debit card is frequently used by students and may also have rewards programs tied to them.

In either case, they both cause problems for the merchant who has a recurring billing or an installment purchase option when there is no money left on the account and the customer already has the goods or services. One merchant told me customers will give a credit card for the down payment, but then ask to use a different card for the recurring billing. The first one will work, but the second is a prepaid or stored value card and there won’t be any money on it when it comes time to charge the account. By the time they discover there is a problem, months have passed.

The solution is to identify the card before it hits your processor. For example, if your customer opts for 3 installment payments, when you enter the card information, it is immediately validated. If you have elected to block non-credit cards for installment payments, the card will not be accepted.

New Virtual terminal web page supplements the virtual terminal blog articles in the blog. Checklist to help merchants choose the best solution without having to hunt through all the articles. I’ve created a list for you below and on the new web page.

Which Virtual Terminal features do you need?

• Basic sale, void, refund.
• Daily batch reports, transaction look up.
• Least cost routing will identify the lowest cost method to process a transaction and pass all data needed to qualify for it. This is NOT just providing the standard level II data that 99% of other virtual terminals deliver. If you’re not sure, ask. If you have corporate customers, this is HIGHLY RECOMMENDED.
• Recurring billing or installment payments. The customer pays the same amount on a fixed schedule.
• Repeat billing- your customer asks you to keep their card on file for billing purposes, but there is no set schedule or amount. Save TONS of time. After entering data one time for a client, simply enter the token ID and amount you want to charge for subsequent transactions.
• Limited user control. Create administrators and users with broad feature access.
• Maximum user control. Micro manage who can see reports, who can give refunds, set thresholds for instant email alerts by dollar amount of sale or of refund, set criteria to approve a transaction by threshold amount etc.
• Extensive real-time reports including activity by user, time of day (staff planning), facility or region, card type, general ledger item and many more. Dynamically create graphic and downloadable spreadsheet reports.
• Fees deducted from transactions or once per month?
• Do you need more than just name and card information such as assign payments to categories or general ledger codes, account numbers, or invoice numbers?
• Batch upload transaction data to process.
• Multiple bank accounts- different accounts for deposits, credits, etc.
• Integration with other systems- API connectivity.
• Multiple payment channels- a back-end that supports more than just the virtual terminal including but not limited to web payments, ecommerce and retail store.
• Always up to date with the latest parameters for interchange qualification (the wholesale cost of credit card processing).
• Least cost routing will identify the lowest cost method to process a transaction and pass all data needed to qualify for it. This is NOT just providing the standard level II data that 99% of other service providers deliver.
• Compatible with all major payment processors.
• PCI Compliant. No credit data is ever stored at your facility.

Law firms accept payments that need to be deposited into different bank accounts, depending on the purpose, such as general account and trust account. Does this mean you need two separate merchant accounts, and therefore incur the costs for two accounts?  Yes.

The main objective is to get the deposits into the correct bank accounts. This requires two merchant accounts which results in two completely different merchant statements, and their associated fees etc. What if you don’t want merchant fees to be deducted from the trust account? This can create issues for your trust account balances. This can be especially difficult for Paypal users which deducts funds from each transaction immediately, creating reconcilation challenges.

With CenPOS, our hosted payment platfom solution, and a compatible processor, you can set up to 5 different bank accounts per merchant account (MID)*. Your bank accounts will reflect exactly the correct balances you require.

For example:
Funding (credits) can be set to one bank account.
Debits (fees) to another bank account.
Disbursement of Debits (Fees, retrievals/chargebacks etc) can also be set per bank account within that one MID.

* Currently compatible with certain Paymentech and First Data merchant accounts.

Do you want to see revenue reports by attorney? Typical merchant account reports have no connection to that, however, our platform lets you set up a heirarchy so you can dynamically generate real-time reports globally across multiple merchant accounts. You can also drill down, much like an organization flow chart, to segments of the top level.

Another benefit for lawyers is TOKEN BILLING. See related article Virtual Terminal Solutions for Attorney’s.

CenPOS is compatible with swipe devices if your clients usually meet you in the office, or you can use the virtual terminal if you collect payments over the phone.

If a retail customer walks in an pays with their credit card, but the cashier made a mistake and entered the wrong amount, can the merchant go back and charge the customer the balance AFTER the customer has left the store? No. According to the Visa Card acceptance guide, “Merchants must NOT alter a sales receipt after the cardholder has signed it and left the establishment. If the cardholder has been undercharged, attempt to contact the cardholder and obtain permission to adjust the receipt so that it reflects the correct amount.”

COMMENTS:

This issue is outlined in Chargeback Reason Code 80: which includes invalid adjustment.

This question was presented by a building supply company that is largely in the wholesale B2B business, but also has some walk-in retail traffic. The consumer selected their merchandise and an invoice for the materials was issued and presented to the customer. Then the card was charged, but the amount entered was wrong.  The customer does not sign the invoice.

The merchant can research information about the transaction in their processors online transaction research, if they offer that capability. Finding the customer can be difficult, but you can try whitepages.com and hope the customer has an unusual name and is from the local area.

The merchant may not be allowed to, and should not try to, charge more than the original authorization, even if they locate the customer. The merchant or the processor may have risk management tools in place to prevent this. If the retailer locates the customer, get permission to create a new transaction which will be key-entered. In the B2B world, ideally, a note with invoice copy is faxed and the customer signs authorization to be billed the balance due. Charging a different amount than the original authorization is an automatic interchange rate downgrade.

On a final note, if the customer DID SIGN THE INVOICE then the merchant MIGHT have a basis to re-bill the customer, provided they had adequate information to do so.  Since card issuers generally side with the customer, not the merchant, if the customer disputed the bill, the merchant will likely lose. PLEASE READ THE CURRENT MERCHANT RULES for the specific card association ( MasterCard, Visa etc) for clarification.

Can I use a single merchant account if I have more than one ecommerce site? By regulation, you must have a different merchant account for each domain name.  The domain name, not the company name, must appear on consumer credit card statements. This is a field entered on the merchant application.  The main purpose is to reduce consumer confusion and thus reduce chargebacks.

What if you have single page checkouts on the same domain name?

For example, the merchant may sell something with a one page checkout. One page is mydomain.com/product1. Another is mydomain.com/product2. They do not link to a single shopping cart checkout for some internal reason. You could possibly use one merchant account for both web pages, provided it’s the same company and shares the same federal tax ID. In some cases the merchant may want to set up a separate terminal identification (TID) to assist in the reconciliation process. Each TID would have it’s own totals, but all the data appears on one merchant statement, under one merchant account. To set up TID’s, contact your merchant processor.

Non-profit organizations sometimes have this with fundraising on their web sites. The non-profit has multiple events and donor options each with a simple one page checkout specific to that event or donation. Provided the rules are met above, you can probably use one merchant account. Always check with your processor for confirmation of your situation.

related articles

internet merchant account requirements

The requirements to open a merchant account vary by merchant industry, estimated dollar volume of payment processing and how you’ll accept credit cards. Part 2 of this series examines the retail merchant who will process under $1,500,000 annually.

Retail means that the customer will pay in person and you’ll swipe the credit card for payment.

The merchant SIC code is used to assign risk. The higher the risk, the more documents required to open a merchant account. The level of risk varies over time. For example, when the mortgage crisis hit, flooring and furniture stores were relegated to high risk because they are heavily tied to the housing market. Below are some general guidelines for what you can expect.

LOW RISK MERCHANT ACCOUNTS
These merchants provide the fewest documents. A simple example is:
- application
- schedule A pricing page
- voided check or bank letter
- recent processing statement, if existing business

MID-RISK MERCHANT ACCOUNTS- All of the above, plus:
- 2 recent consecutive months merchant statements

HIGH RISK MERCHANT ACCOUNTS- All of the above plus:
- 3 recent consecutive months merchant statements
- personal guarantee

Note: Some processors will require 2 years business financials for mid and high risk merchants. Additionally, the business and personal credit score may be used in in determining your approval. We highly recommend that you are upfront with your sales agent about your personal credit score. If under 700, additional documentation and a personal guarantee may be required at any level.

Common question- Why do I need to provide my social security on the merchant application?

Part 1 of the series answers What are requirements to open an internet merchant account?

I specialize in consulting and merchant account set up for those processing over $1,000,000 annually.

Is a merchant required to display the Visa logo? Yes. This is clearly outlined in the Visa Card Acceptance Guide. Merchants must display the Visa logo at the merchant location or on catalog, sale materials, or websites.

So, if you do not have the logo on your catalog order form, or your web site, you are not in compliance with card association rules. Refer to page 9 of the Card Acceptance Guide aka Card Acceptance and Chargeback Management Guidelines for Visa Merchants.

- link to Visa to download brand logos

Card issuers have 120 days from the central processing date to charge back transactions in which the cardholder claims to have not participated. Consumers or cardholders should notify their card issuer as soon as they identify a problem.  The clock starts from the central processing date shown on the billing statement.

Merchant Risk for Chargebacks- Visa Rules (page 6) Complete Visa Risk Management Guide for Ecommerce 2008