Visa Partial Authorization Service

Visa merchant library update on December 13, 2016. Visa provides a Partial Authorization service that provides an alternative to declining a transaction when the card’s available balance is not sufficient to approve a transaction in full. This flyer provides information about the benefits realized, how to use the service, and answers to frequently asked questions.

PDF 326 KB Visa Partial Authorization Service – Improve the Customer Experience and Increase Sales

“Partial authorization improves the customer experience by preventing embarrassment from a decline at the point of sale and enabling a seamless checkout with split tender transaction using multiple payment methods.” Christine Speedy

To accept partial authorizations for your business, a few items are needed:

  • Technology that supports it. Payment gateways certify partial authorization for each acquirer. Not all gateways certify.  The receipt must also show each payment amount.
  • The merchant must enable it. For example, this could be a checkbox in the ERP or shopping cart software payments module, or it might be turned on at the gateway administration level. It’s possible a gateway is certified, but the related software using the gateway does not support it.

If partial authorization is not supported, and there’s a decline due to insufficient funds, there’s still an open authorization for the funds that were in the account. An authorization reversal should be completed to remove hold on any cardholder funds. If you don’t want screaming customers, this is a must! Intelligent technology can automate this process.

Compliance with credit card processing rules can be extremely complicated. Relying upon employee training is futile. To improve your customer experience and automate rules compliance, contact Christine today at 954-942-0483.

 

Stopping Online Credit Card Testers

Online credit card testing by fraudsters can dramatically drive up payment gateway fees.  Historically, card not present financial fraud grows exponentially in countries after implementing EMV chip card processing, as thieves seek the weakest link for fake credit card purchases. Thieves use software to rapidly send cardholder data to payment web sites to verify if stolen cards are good, card testing, and since merchants pay a per transaction fee, regardless of approval, the financial impact can be devastating.

Companies with online pay pages are at increased risk. Since October 2015, online fraud attacks were up 11% 2015 Q4 Vs Q3, and up 215 percent from 2015 Q1. 83% of attacks involved botnets. Source: The Global Fraud Attack Index™, a PYMNTS/Forter collaboration. The preferred web pay pages have no login required, and provide detailed decline response reasons. I’m often asked by others in the industry to provide the latter, and for the same reason as for retail, it’s better than no one knows the reason for the decline. If you inform a criminal the expiration date is no good, they just need to figure out the right one.

PREVENTING ONLINE CARD TESTING

A layered approach is required to stop card testers since no single solution will stop fraudsters. Generally, the harder you make it, the more likely they will seek a path of less resistance.

  • Block known fraudulent incoming IP addresses. The bad guys also use hostile proxy servers, with dynamically changing IP addresses every authorization attempt, but this is still a first step everyone should employ.

For additional assistance, please contact us. I won’t make it easier for criminals by identifying all the tools here in the blog!

ERP and Payments: PCI Compliance Nightmare

A PCI Compliant ERP solution doesn’t make a merchant PCI Compliant. The features of the payment integration drive customer decisions to use or not use the an ERP payment module. When payment vendor choices are restricted artificially by using technology to control merchant services options, merchants often enter ERP relationships with a level of dissatisfaction right from the start.

Severely restricted payment gateway options, especially for business to business, results in either the merchant using an alternative non-integrated payment solution, thus sacrificing efficiency, or using the integrated solution, and failing to meet PCI 3.0 requirements or other payment needs. How can I make this statement? B2B companies that accept credit cards  typically have a portion of their sales via the telephone. To mitigate risk of fraud, they use paper credit card authorization forms. However, the forms are inherently risky in many ways.

  • Sensitive authentication data, which includes the security code (CVV/CID), can never be stored.
  • Forms offer option to send via email. Unprotected data cannot be sent via messaging technologies such as e-mail, instant messaging, chat, etc. (PCI section 4.2). Even if the form doesn’t offer it, customers sometimes ignore instructions and send via email.

In the absence of a best practice, employees will revert to whatever is necessary to get their job done and reduce the risk of looking bad (fraud losses). If the ERP payment module doesn’t help merchants eliminate credit card authorization forms, the entire operation may be at risk of a potential data breach.

For retail, data breaches have become commonplace. Few ERP Point of Sale (POS) solutions are using Point to Point (P2P) encryption and other best practices to reduce data breach risk. They raced to bring mobile to market, and many now have neither EMV chip terminals nor P2P, both increasing financial risk to merchants.

Why does an ERP restrict options for merchant services? Because it’s part of their revenue stream. When competition is eliminated, there’s almost no chance of having the best solution in the marketplace. The proof is a long string of failures to meet business needs. Failure to offer electronic bill presentment and payment, which would increase cash flow and efficiency. Failure to offer US EMV chip card acceptance solution prior to liability shift. Failure to offer level 3 processing for all sales channels. Failures reduce cash flow, profits, and security as companies attempt to work with the ERP limitations, or find ways to work around them.

The argument that it’s to protect merchants from data breaches is only partially true. For any modern payment gateway integration, the payment activity is usually outside the ERP to reduce PCI scope. That won’t change from one gateway to another, so the risk doesn’t change, provided the third party gateway is level 1 PCI Compliant.

Examples of ERP’s that restrict payment gateway and merchant services choices are Netsuite and Sage. Additionally, consultants are often compensated for payment gateway recommendations. Consulting with an independent payment specialist, like blog author Christine Speedy, can expose pros and cons of different options.

ERP’s holding onto merchant services and gateway revenue streams are short sighted, as these business practices that anger customers. Can you imagine if an ERP wouldn’t communicate with any other software, for example, Magento? ERP’s focused on delivering the best business software for all facets of a business, and enabling the merchant to follow best practices for PCI Compliance must give users the flexibility needed to run their business with their own financial partners.

If an ERP relies so much on their revenue stream from merchant services revenue share that they won’t let you choose your own financial partners, I’d think seriously about whether it’s the best ERP for your business.