Visa Stored Credential Mandate Overview

How can merchants get compliant with the Visa Stored Credential Transaction framework and mandates effective October 14, 2017? Most companies are under the false impression that their acquirer and or payment gateway manages compliance. Not true. While some technical aspects are managed by the payment gateway, the merchant also has to make some changes for compliance.

What is a Stored Credential? A stored credential is information (including, but not limited to, an account number or payment token) that is stored to process future purchases for a cardholder.

What is the Visa Stored Credential framework and mandate? It outlines the rules related to storing and using stored credentials. Since it’s 15 pages long, I’ll only highlight a few important items here.

  • Merchant initiated or customer initiated transactions? Make sure your payment gateway is sending the correct code. For example, an ecommerce store checkout would be customer initiated. A recurring billing transaction is merchant initiated.
  • Get customer consent for terms and conditions of storing and using stored card.
  • Advise how the cardholder will be notified of any changes to the consent agreement.
  • For a transaction using a stored credential initiated by the cardholder, the merchant or its agent must validate the cardholder’s identity before processing. The only valid methods are 3-D Secure Verified by Visa and the security code.
  • Receipt must be provided for the initial cardholder validation ($0 dollar transaction or actual amount.)
  • All stored credential transactions must be submitted with a value of “10” in the POS Entry Mode Code field; this is for both newly stored cards and all prior transactions using stored credential. This is managed by the payment gateway. (Confirm your gateway is doing this.)

What about the other card brands? Mastercard rolled out their version in June 2018. If you comply with the Visa mandate, you’ll be in compliance with any others at this time.

What if I don’t comply?

  • You’ll be non-compliant with Visa’s rules and risk Non Compliance Assessments
  • No benefit from expected improved authorization rate
  • Increased customer complaints and poor cardholder experience
  • Cannot use Real Time Visa Account Updater service
  • Risk issuer generated chargebacks for all transactions using the stored credential within the allowable chargeback timeframe under reason code 72, invalid authorization. A valid authorization is needed to qualify for the lowest interchange rates.

What are the benefits of compliance? Increased authorizations, better customer experience, more profits.

See Improving Authorization Management for Transactions with Stored Credentials https://usa.visa.com/dam/VCOM/global/support-legal/documents/stored-credential-transaction-framework-vbs-10-may-17.pdf . Are you going to manage documenting everything or are you going to use technology to help you manage it?

PCI Compliant credit card authorization form

Partial CenPOS PCI Compliant stored credential authorization form.

Verify if you have a system to manage authorization validity. What the heck does that mean? Many companies have complex needs including pre-authorizations, incremental authorizations, delayed shipping etc. While you may get issuer approvals, that doesn’t mean the authorization is valid. Are you compliant now? Look at your merchant statement ‘pending interchange fees. If you see  EIRF or STD or misuse of authorization fee, there’s a problem.

Replace paper credit card authorization forms, and any digital form that you can decrypt and view sensitive card data. Offer your customers a way to self-manage their own wallet with either a hosted online pay page or Electronic Bill Presentment & Payment.

New to online payments? See Visa best practices to prevent brute force attacks. https://usa.visa.com/support/merchant/library/visa-merchant-business-news-digest.html. CenPOS includes recaptcha and client managed velocity and other rules as part of a layered security approach.

Register for 3-D Secure, including Verified by Visa, with your acquirer. Don’t do this until you know which payment gateway will be used and get their instructions if applicable.

interchange rate qualification

The same transaction can process at different rates as shown above, depending on which rules you follow. CenPOS Smart Rate Selector automates compliance to qualify transactions at the lowest rate possible. Which rates are on your merchant statement now?

Where can I buy CenPOS or learn more? You’ve already found one of the top salespeople, Christine Speedy. All agreements are direct with CenPOS, no middle man.

Resources and documentation https://3dmerchant.com/blog/merchant-bulletins-downloads – bookmark it!.  Join Christine Speedy’s email list.

DISCLAIMER: condensed and incomplete information! Information may be quickly outdated.

With the fast pace of changing rules, companies need a technology partner to automate compliance. Did you know?

  • CenPOS has a suite of solutions for companies just like yours, solving common problems and increasing profits virtually overnight.
  • For those not ready to give up paper, CenPOS creates a printable PCI Compliant credit card authorization form for every stored card.
  • CenPOS has ERP, ecommerce shopping cart, accounting and other plug-in modules available for quick and easy implementation.
  • I’ve been selling for CenPOS since day 1. Though I have other payment gateways available in my arsenal, nothing else compares.

Call Christine Speedy for global sales. 954-942-0483, 9-5 ET, CenPOS authorized reseller based out of South Florida and NY. CenPOS is an integrated commerce technology platform driving innovative, omnichannel solutions tailored to meet a merchant’s market needs. Providing a single point of integration, the CenPOS platform combines payment, commerce and value-added functionality enabling merchants to transform their commerce experience, eliminate the need to manage complex integrations, reduce the burden of accepting payments and create deeper customer relationships.

B2B Credit Card Processing Hot Tips

Compliance with credit card processing rules maximizes profits while mitigating risk. This is especially true for business to business companies. But it’s getting harder and harder with the onslaught of new rules, and virtually impossible if not using a sophisticated cloud solution to help manage compliance.

If your B2B company stores credit cards, there’s a pretty good chance you’re not compliant. For example, Visa’s 2017 Stored Credential Transaction framework outlines merchant responsibilities to obtain customer consent as well as storing credit cards, using stored credentials (token), and managing stored tokens. Failure to comply with Authorization rules, for example preauthorization and final settlement do not match, has far-reaching consequences including higher interchange rates (the bulk of credit card processing fees), penalty fees and new chargeback risks. With so many new rules across multiple card brands that vary based on business and transaction type how can a business quickly ascertain if they’re compliant?

Most processing details occur seamlessly behind the scenes so merchants have not had a simple way of knowing whether they’re compliant. Until now.

Quick tips to validate compliance:

  • Is a transaction receipt delivered to customer when a stored credit card credential (token) is created? Compliant answer is yes.
  • Is cardholder authentication with a zero dollar authorization or a purchase transaction performed at the time token is created? (A small charge is not an acceptable practice.) Compliant answer is yes.
  • Does the receipt include “RECURRING” or “REPEAT SALE” for token transactions? Compliant answer is yes.
  • Review merchant statements, usually the last 1-2 pages with the heading “pending interchange” or “fees” section. Do you see EIRF, STANDARD (STD), or DATA RATE I? Compliant answer is no.
  • Can you produce documentation of customer consent to store their card (including with 3rd party service) and how it will be used?

If you’re not in compliance, your payment gateway is the most likely culprit, followed by ERP or other software integration limitation. For a Microsoft Dynamics AX, Dynamics 365, and other ERP integrated solutions, call 954-942-0483 9-5 ET.

Reference: Card brand links.

Christine Speedy, CenPOS Sales 954-942-0483. CenPOS is a cloud business solutions provider with end-to-end payments engine that drives enterprise-class solutions for businesses, saving them time and money, while improving their customer engagement.

What is Auth Code 14, declined?

A credit card processing response of Auth Code 14, is a decline for Processor Declined, Fraud Suspected. Why does this happens for recurring billing, including unscheduled recurring billing using a stored credential, also known as a token on file? The method used to store the first transaction, and process subsequent transactions can impact authorization approvals.

For example, a merchant has successfully processed unscheduled transactions using a token on file since 2016. However, in 2017, declined for Auth Code 14 appeared.

auth code decline 14

Why would a previously stored and working card decline now? Look at the AVS,  ZIP, and CVV response above. Compare to the example below.

token billing

For the second receipt, AVS match Y= address and 5 digit zip match, Zip match Y=Address and 5 digit zip match, CVV = match X, cannot verify CVV. Because CVV was verified a match on the initial zero dollar authorization it’s not required to be presented on subsequent transactions.

The first example is returning that information does not match, thus the reason for suspected fraud. Without looking at the very first authorization when token was created, several possibilities exist, including  cardholder issued a new chip card with same number but other changes occurred in the interim; cardholder address changed or was never validated.

Merchants are at risk of issuer initiated chargeback if authorization rules are not followed. Refer to  Visa Product and Service Rules, Table 5-21: Requirements for Prepayments and Transactions Using Stored Credentials for more information. With recent rules changes, and more coming October 2017, merchants need a cloud based solution that can automate compliance. Not all of them have that intelligence. For example, some cloud based payment gateways enable merchants to perform prohibited transaction requests that put the authorization at risk of chargeback for non-compliance.

Due to many recent and upcoming changes for card absent and recurring billing with stored credentials, merchants are advised to review processes to include empowering customers to self-manage adding cards on file, and using cardholder authentication. Visa requires Verified by Visa for cardholder authentication in a card not present environment; without it, expect increasing declines.

Disclaimer: The rules of card acceptance are very complex and change typically twice a year, sometimes with interim bulletins regarding more changes. Merchants should read the manual for complete details regarding card acceptance for your business type.

Christine Speedy, authorized CenPOS reseller, provides universal payment processing solutions, including cardholder authentication, to maximize merchant profits and mitigate risk across multiple sales channels. Contact Christine at 954-942-0483. 

Card Not Present Token Billing Best Practice & CenPOS Training

Ready to improve PCI Compliance with token billing? Step by step instructions for CenPOS card not present token billing including creating, modifying, and using tokens follows.

  1. In the virtual terminal admin, Create a new Role* or Modify an existing role to include token billing permissions, only for what the user is allowed to do. For example, if you employees are allowed to create tokens, but not conduct sales, check the Manage Token and Positive Card only.

    token billing roles

    Virtual Terminal administration- Partial list of permission options; token billing related items are checked

  2. Are email receipts available now? If no, send an email request to support via link on the virtual terminal login page. In the subject put: “your CenPOS MID” email receipt request. In the body, include all your contact info, the MID, and what email address you want receipts to come from.
  3. Prepare training worksheet for distribution
  4. Distribute Self-paced training checklist (10 minutes to complete) to all users
  5. Get documentation of all training- who, what, when. It may be useful as part of an overall PCI Compliance (Payment Card Industry Data Security Standards) plan to comply with section 12, Maintain an Information Security Policy.
  6. Assign users to the new roles with return of documentation
  7. If there’s any legacy cardholder data on file, plan it’s secure destruction

References: Token Billing Training Videos

*See CenPOS Virtual Terminal Manual for details on using Role Templates.

A sample document, created by Christine Speedy,  for training and documentation is available upon request.