F.A.Q.
General Questions
1. What is Member Service Provider (MSP)?
2. What is Merchant Identification Number (MID)?
3. What is Dynamic Currency Conversion (DCC)?
4. What is Truncation?
5. What is retrieval request?
6. What is Interchange?
7. What is Authorization?
8. What is Settlement?
9. What is “Call Auth”?
10. What is Code 10 authorization?
11. What is Address Verification Service (AVS)?
12. What is Batch?
13. What is Demand Deposit Account (DDA)?
14. What is Doing Business As (DBA)?
15. What is “decline”?
16. What is a debit card?
17. What is the Debit ATM Card?
18. What is the “Check” Card?
19. What does Elavon consider as Restricted and/ or Prohibited merchants?
20. What does FDMS consider as Restricted and/ or Prohibited merchants?
Chargeback Questions:
1. What is a chargeback?
2. What are the common practices that the merchant should do?
3. How can I get a chargeback when I received an approval code for the transaction?
4. How can I guarantee my transaction does not turn into a chargeback?
5. How critical is the “Respond by date” from the chargeback or retrieval (copy) advice?
6. Why did the Merchant Processor debit my account without notifying me first?
7. How long does a Card Issuing Bank have to bring up a chargeback?
8. What are the best-practice requirements for “Mail Order or Telephone Order” business?
9. How could merchant handle a non-verifiable AVS response?
10. What is “Code 10 Service”?
11. What are the best practice requirements for “Retail or Restaurant” face-to-face transactions?
1. What is Member Service Provider (MSP)?
2. What is Merchant Identification Number (MID)?
3. What is Dynamic Currency Conversion (DCC)?
4. What is Truncation?
5. What is retrieval request?
6. What is Interchange?
7. What is Authorization?
8. What is Settlement?
9. What is “Call Auth”?
10. What is Code 10 authorization?
11. What is Address Verification Service (AVS)?
12. What is Batch?
13. What is Demand Deposit Account (DDA)?
14. What is Doing Business As (DBA)?
15. What is “decline”?
16. What is a debit card?
17. What is the Debit ATM Card?
18. What is the “Check” Card?
19. What does Elavon consider as Restricted and/ or Prohibited merchants?
20. What does FDMS consider as Restricted and/ or Prohibited merchants?
Chargeback Questions:
1. What is a chargeback?
2. What are the common practices that the merchant should do?
3. How can I get a chargeback when I received an approval code for the transaction?
4. How can I guarantee my transaction does not turn into a chargeback?
5. How critical is the “Respond by date” from the chargeback or retrieval (copy) advice?
6. Why did the Merchant Processor debit my account without notifying me first?
7. How long does a Card Issuing Bank have to bring up a chargeback?
8. What are the best-practice requirements for “Mail Order or Telephone Order” business?
9. How could merchant handle a non-verifiable AVS response?
10. What is “Code 10 Service”?
11. What are the best practice requirements for “Retail or Restaurant” face-to-face transactions?
General Questions:
1. Q: What is Member Service Provider (MSP)?
A: A Member Service Provider (MSP) is a licensed broker of credit card services to merchants.
2. Q: What is Merchant Identification Number (MID)?
A: A unique identification number assigned to a Merchant to identify its business (also referred to as the “Merchant Account”).
3. Q: What is Dynamic Currency Conversion (DCC)?
A: DCC converts international Visa and MasterCard credit card purchases into the cardholder’s home currency at the point of sale.
4. Q: What is Truncation?
A: The credit card account number must be truncated on all card-holder-receipt, truncated digits should be replaced with a fill character such as “x”,”#”, or “*”, and not with a blank space or numeric characters.
5. Q: What is retrieval request?
A: If card holders have questions about the credit card transaction, they can file dispute to the issuing bank. Merchant must respond to a Retrieval Request with a legible copy of the sales slip or terms agreement within the time frame specified. If you fail to provide a legible copy of the transaction receipt, you might receive a chargeback.
6. Q: What is Interchange?
A: Interchange qualification requirements, as defined by the Credit Card Associations, affect the Merchant’s fee or surcharges owed for transactions. Merchant will pay a higher discount rate, higher fees, and surcharges for Transactions that do not meet the best rate qualification criteria or have been processed in a manner other which the merchant was approved.
7. Q: What is Authorization?
A: Merchant’s request for approval of a sales transaction by an issuer. Authorization is initiated by accessing the authorization center by telephone or electronic terminal.
8. Q: What is Settlement?
A: The clearance through interchange of the credit card transactions accumulated by the merchant in the terminal host so the merchant can be paid for them.
9. Q: What is “Call Auth”?
A: This response indicated that the Issuing Bank wants the merchant to call the voice authorization center, which will either give an approval code or ask the merchant to get additional information that the Issuing Bank has requested, such as address or mother’s maiden name. The voice authorization operator will give the requested information to the issuing bank and the issuing bank will either approve or decline the sale.
10. Q: What is Code 10 authorization?
A: An authorization or an “additional verification step” obtained for a suspicious or questionable transaction, card or cardholder.
For Visa/MasterCard/Discover: 1-800-834-0409 begin_of_the_skype_highlighting 1-800-834-0409 end_of_the_skype_highlighting
For Amex: 1-800-528-212
11. Q: What is Address Verification Service (AVS)?
A: A fraud-reduction service that allows a Merchant to verify a Cardholder’s billing address prior to completing a Card Not Present Transaction.
12. Q: What is Batch?
A: The accumulated card transactions stored in the POS (Point Of Sale) Device or Host computer.
13. Q: What is Demand Deposit Account (DDA)?
A: A commercial banking account designed by the merchant through which all transactions, fees, charges, adjustments, and chargeback are processed.
14. Q: What is Doing Business As (DBA)?
A: The trade name of a Merchant that may appear on business signs, customer literature, or other documents.
15. Q: What is “decline”?
A: A “decline” code indicates that the card issuer does not approve the transaction.
Debit Cards
16. Q: What is a debit card?
A: Debit cards allow purchase amounts to be deducted directly from the cardholder’s checking or saving account.
17. Q: What is the Debit ATM Card?
A: ATM stand for “automated teller machine.” ATM cards are issued to customers who open a checking or saving account at a financial institution to allow customers access to their accounts anytime.
18. Q: What is the “Check” Card? A: A “check” card is a debit card with the Visa or MasterCard logo that can be used either as a regular credit card or as a debit card.
Avoiding Chargebacks
1. Q: What is a chargeback?
A chargeback is a transaction disputed by the cardholder or issuer. There are many reasons for chargebacks, but the most common are returned merchandise, terminated services, disputes, errors, or fraud.
Chargebacks are a costly part of accepting credit cards. However, merchants can minimize chargebacks at the time of sale by working to achieve maximum customer satisfaction and transaction accuracy.
Q2. What are the common practices that the merchant should do?
(1) Never let any customer operate your credit card terminal with the exception of keying in their PIN.
(2) If you get a “Decline” response, do not process any more sales on that particular card.
(3) Only use an authorization code which has been provided directly from your Merchant Processor.
(4) Never use the customer’s phone or phone number to call for transaction authorization.
Q3. How can I get a chargeback when I received an approval code for the transaction?
An authorization code simply verifies if the card is in good standing , has not been reported lost or stolen at the time of the transaction, and it has sufficient funds available for the amount of the transaction that you are attempting to process. An authorization code does not guarantee that you will not receive a chargeback.
Q4. How can I guarantee my transaction does not turn into a chargeback?
Fraud comes in all shapes and sizes. There is nothing that can be done to stop a dispute. However, most merchants can do a lot more to prevent chargebacks and minimize the risk exposure. For example, merchants can closely follow the transaction requirements and make sure to utilize all the available resources (AVS or Calling Code 10 Service.) Merchants may refuse to process any suspicious credit card transaction and request the customer provide a different form of payment.
Q5. How critical is the “Respond by date” from the chargeback or retrieval (copy) advice?
Whoever handles the response needs to pay special attention to the response deadline. Otherwise, a non-reversible chargeback will result in a financial lost. It is always recommended to respond to a chargeback or retrieval as quickly as possible to avoid many unexpected situations.
Q6. Why did the Merchant Processor debit my account without notifying me first?
When a chargeback is initiated by the card issuer, an automatic debit will occur against the Merchant Processor, and in turn that debit is passed to the merchant in accordance to Visa and MasterCard regulations.
However, the merchant can receive a conditional credit if they respond with sufficient information within the allotted timeframes to dispute the cardholder’s claims.
Q7. How long does a Card Issuing Bank have to bring up a chargeback?
A retrieval or chargeback can be requested by the Card Issuing Bank for up to 18 months after the transaction date. Therefore, it is crucial that you keep your transaction records accessible and legible for this time frame.
Avoiding Fraudulent Transactions (Mail order / Telephone order)
Q8: What are the best-practice requirements for “Mail Order or Telephone Order” business?
(1) Transaction records must show a 100% “match” on AVS (Address Verification System)
(2) Transaction records must show a “match” on CVV2 (Card Verification Value 2)
(3) Merchant must ship the merchandise to the AVS address.
(4) Merchant should have the proof of delivery signed by the cardholder.
Q9: How could merchant handle a non-verifiable AVS response?
When the AVS was not verifiable through the Card Issuing Bank from the transaction terminal, merchants may ask the customer for a different card or different form of payment to reduce the risk exposure, however most non-US issuing banks do not support AVS. If you do a lot of business outside the US, merchants may need to make adjustments to allow for this increased financial risk.
Q10: What is “Code 10 Service”?
Merchants should make a Code 10 call to Merchant Support Call Center whenever you are suspicious about a card, cardholder, or a transaction. A representative at your Merchant Processor may first ask you for transaction details. Your call will then be transferred to the Card Issuing Bank’s special operator who will assist you further on the verification with simple “yes” or “no” questions.
For e-Commerce merchants, during check out, make sure to have a check box or button for the customers to agree specific policies to be enforced such as cancellation or refund/return. Such policies must be stated clearly and placed with the check box or button as a stand-alone action during check-out. They must not be presented within a scroll-through "Terms and Conditions" window only the merchant needs to strictly enforce the policies in the event of chargeback.
Avoiding Fraudulent Transaction (Restaurant / Retail Business)
Q11: What are the best practice requirements for “Retail or Restaurant” face-to-face transactions?
(1) Swiping card through the terminal. (Terminal Sales-draft must be legible)
(2) Matching the signature on the driver’s license or State ID card if the signature on the back of the credit card is not legible.
For a manually keyed transaction, merchant is required to take the “additional” step of creating an imprint of the credit card. The imprint copy should show the cardholder’s signature, transaction date, and authorization code. Most important of all, merchant still needs to follow step (2) and step (3) above.
1. Q: What is Member Service Provider (MSP)?
A: A Member Service Provider (MSP) is a licensed broker of credit card services to merchants.
2. Q: What is Merchant Identification Number (MID)?
A: A unique identification number assigned to a Merchant to identify its business (also referred to as the “Merchant Account”).
3. Q: What is Dynamic Currency Conversion (DCC)?
A: DCC converts international Visa and MasterCard credit card purchases into the cardholder’s home currency at the point of sale.
4. Q: What is Truncation?
A: The credit card account number must be truncated on all card-holder-receipt, truncated digits should be replaced with a fill character such as “x”,”#”, or “*”, and not with a blank space or numeric characters.
5. Q: What is retrieval request?
A: If card holders have questions about the credit card transaction, they can file dispute to the issuing bank. Merchant must respond to a Retrieval Request with a legible copy of the sales slip or terms agreement within the time frame specified. If you fail to provide a legible copy of the transaction receipt, you might receive a chargeback.
6. Q: What is Interchange?
A: Interchange qualification requirements, as defined by the Credit Card Associations, affect the Merchant’s fee or surcharges owed for transactions. Merchant will pay a higher discount rate, higher fees, and surcharges for Transactions that do not meet the best rate qualification criteria or have been processed in a manner other which the merchant was approved.
7. Q: What is Authorization?
A: Merchant’s request for approval of a sales transaction by an issuer. Authorization is initiated by accessing the authorization center by telephone or electronic terminal.
8. Q: What is Settlement?
A: The clearance through interchange of the credit card transactions accumulated by the merchant in the terminal host so the merchant can be paid for them.
9. Q: What is “Call Auth”?
A: This response indicated that the Issuing Bank wants the merchant to call the voice authorization center, which will either give an approval code or ask the merchant to get additional information that the Issuing Bank has requested, such as address or mother’s maiden name. The voice authorization operator will give the requested information to the issuing bank and the issuing bank will either approve or decline the sale.
10. Q: What is Code 10 authorization?
A: An authorization or an “additional verification step” obtained for a suspicious or questionable transaction, card or cardholder.
For Visa/MasterCard/Discover: 1-800-834-0409 begin_of_the_skype_highlighting 1-800-834-0409 end_of_the_skype_highlighting
For Amex: 1-800-528-212
11. Q: What is Address Verification Service (AVS)?
A: A fraud-reduction service that allows a Merchant to verify a Cardholder’s billing address prior to completing a Card Not Present Transaction.
12. Q: What is Batch?
A: The accumulated card transactions stored in the POS (Point Of Sale) Device or Host computer.
13. Q: What is Demand Deposit Account (DDA)?
A: A commercial banking account designed by the merchant through which all transactions, fees, charges, adjustments, and chargeback are processed.
14. Q: What is Doing Business As (DBA)?
A: The trade name of a Merchant that may appear on business signs, customer literature, or other documents.
15. Q: What is “decline”?
A: A “decline” code indicates that the card issuer does not approve the transaction.
Debit Cards
16. Q: What is a debit card?
A: Debit cards allow purchase amounts to be deducted directly from the cardholder’s checking or saving account.
17. Q: What is the Debit ATM Card?
A: ATM stand for “automated teller machine.” ATM cards are issued to customers who open a checking or saving account at a financial institution to allow customers access to their accounts anytime.
18. Q: What is the “Check” Card? A: A “check” card is a debit card with the Visa or MasterCard logo that can be used either as a regular credit card or as a debit card.
Avoiding Chargebacks
1. Q: What is a chargeback?
A chargeback is a transaction disputed by the cardholder or issuer. There are many reasons for chargebacks, but the most common are returned merchandise, terminated services, disputes, errors, or fraud.
Chargebacks are a costly part of accepting credit cards. However, merchants can minimize chargebacks at the time of sale by working to achieve maximum customer satisfaction and transaction accuracy.
Q2. What are the common practices that the merchant should do?
(1) Never let any customer operate your credit card terminal with the exception of keying in their PIN.
(2) If you get a “Decline” response, do not process any more sales on that particular card.
(3) Only use an authorization code which has been provided directly from your Merchant Processor.
(4) Never use the customer’s phone or phone number to call for transaction authorization.
Q3. How can I get a chargeback when I received an approval code for the transaction?
An authorization code simply verifies if the card is in good standing , has not been reported lost or stolen at the time of the transaction, and it has sufficient funds available for the amount of the transaction that you are attempting to process. An authorization code does not guarantee that you will not receive a chargeback.
Q4. How can I guarantee my transaction does not turn into a chargeback?
Fraud comes in all shapes and sizes. There is nothing that can be done to stop a dispute. However, most merchants can do a lot more to prevent chargebacks and minimize the risk exposure. For example, merchants can closely follow the transaction requirements and make sure to utilize all the available resources (AVS or Calling Code 10 Service.) Merchants may refuse to process any suspicious credit card transaction and request the customer provide a different form of payment.
Q5. How critical is the “Respond by date” from the chargeback or retrieval (copy) advice?
Whoever handles the response needs to pay special attention to the response deadline. Otherwise, a non-reversible chargeback will result in a financial lost. It is always recommended to respond to a chargeback or retrieval as quickly as possible to avoid many unexpected situations.
Q6. Why did the Merchant Processor debit my account without notifying me first?
When a chargeback is initiated by the card issuer, an automatic debit will occur against the Merchant Processor, and in turn that debit is passed to the merchant in accordance to Visa and MasterCard regulations.
However, the merchant can receive a conditional credit if they respond with sufficient information within the allotted timeframes to dispute the cardholder’s claims.
Q7. How long does a Card Issuing Bank have to bring up a chargeback?
A retrieval or chargeback can be requested by the Card Issuing Bank for up to 18 months after the transaction date. Therefore, it is crucial that you keep your transaction records accessible and legible for this time frame.
Avoiding Fraudulent Transactions (Mail order / Telephone order)
Q8: What are the best-practice requirements for “Mail Order or Telephone Order” business?
(1) Transaction records must show a 100% “match” on AVS (Address Verification System)
(2) Transaction records must show a “match” on CVV2 (Card Verification Value 2)
(3) Merchant must ship the merchandise to the AVS address.
(4) Merchant should have the proof of delivery signed by the cardholder.
Q9: How could merchant handle a non-verifiable AVS response?
When the AVS was not verifiable through the Card Issuing Bank from the transaction terminal, merchants may ask the customer for a different card or different form of payment to reduce the risk exposure, however most non-US issuing banks do not support AVS. If you do a lot of business outside the US, merchants may need to make adjustments to allow for this increased financial risk.
Q10: What is “Code 10 Service”?
Merchants should make a Code 10 call to Merchant Support Call Center whenever you are suspicious about a card, cardholder, or a transaction. A representative at your Merchant Processor may first ask you for transaction details. Your call will then be transferred to the Card Issuing Bank’s special operator who will assist you further on the verification with simple “yes” or “no” questions.
For e-Commerce merchants, during check out, make sure to have a check box or button for the customers to agree specific policies to be enforced such as cancellation or refund/return. Such policies must be stated clearly and placed with the check box or button as a stand-alone action during check-out. They must not be presented within a scroll-through "Terms and Conditions" window only the merchant needs to strictly enforce the policies in the event of chargeback.
Avoiding Fraudulent Transaction (Restaurant / Retail Business)
Q11: What are the best practice requirements for “Retail or Restaurant” face-to-face transactions?
(1) Swiping card through the terminal. (Terminal Sales-draft must be legible)
(2) Matching the signature on the driver’s license or State ID card if the signature on the back of the credit card is not legible.
For a manually keyed transaction, merchant is required to take the “additional” step of creating an imprint of the credit card. The imprint copy should show the cardholder’s signature, transaction date, and authorization code. Most important of all, merchant still needs to follow step (2) and step (3) above.
