Card Acceptance Procedures

Acceptance Procedures for Purchase Transactions

The following requirements are relevant to the merchant's acceptance procedures for purchase transactions.

• Card must be present. A payment card must be presented to the merchant for all transactions except in the case of mail orders, telephone orders, card-not-present unique transactions, eCommerce transactions, and pre-authorized orders.
• Determine whether the card is valid. The merchant must complete the following steps to determine whether each card presented is a valid payment card:
  
  • Check the valid date and the expiration date on the face of the card. If the card is expired or not yet valid, the merchant must obtain an authorization from the card issuer.
  • Check the Electronic Warning Bulletin or international Warning Notices. If the account number is listed, the merchant must not complete the transaction without obtaining an authorization from the card issuer.
  • Compare the four-digit truncated account number imprinted in the signature panel with the last four digits of the embossed account number on the face of the card.
  • Unless a hybrid terminal is used, compare the embossed account number on the face of the card with the number displayed or printed from the point of sale (POS) terminal.
  • If a photograph of the cardholder is present on the card, compare the photograph on the card with the person presenting the card.
  • Check that the card is signed.
  • For unique transactions processed in a face-to-face environment (with the exception of truck stop transactions and card-read transactions where a non-signature CVM is used), request personal identification of the cardholder in the form of an unexpired, official government document. Compare the signature on the personal identification with the signature on the card.
• Unsigned cards. If the card is not signed, the merchant must:
  
  • Obtain an authorization from the card issuer.
  • Ask the cardholder to provide identification (but not record the cardholder identification information).
  • Require the cardholder to sign the card.
  The merchant must not complete the transaction if the cardholder refuses to sign the card.
• Suspicious cards. If the merchant believes that there is a discrepancy in the signature, or if the last four digits of the embossed account number do not match the four-digit truncated account number on the signature panel or displayed on the terminal, or if the photographic identification is uncertain, the merchant must contact its acquiring bank for instructions. If any unexpired card does not have a hologram on the lower right corner of the card face (for Visa and MasterCard cards), the merchant must pick up the card and contact its acquiring bank's Code 10 operator to advise it of the pick-up and to receive mailing instructions.

Obtaining an Authorization

The following information and requirements are relevant to the merchant's obtaining of an authorization.

• Treat all transactions the same. With respect to obtaining authorizations of transactions, the acquiring bank must treat all transactions at a merchant location in the same manner.
• Retain the card while obtaining authorization. The merchant must use its best efforts, by reasonable and peaceful means, to retain the card while making an authorization request.
• When to obtain an authorization. The merchant must obtain an authorization from the card issuer before completing the transaction in the following instances:
  
  • The transaction amount exceeds the merchant's floor limit or the floor limit applicable to the transaction.
  • The card is expired or not yet valid.
  • The card is not signed.
  • The merchant wishes to delay presenting the transaction record.
  • The transaction receipt cannot be imprinted although the card is present.
  • The merchant's data processing equipment is unable to read the magnetic stripe or the chip (if one is present) on the card.
  • The account number is listed on the regional Warning Notice.
  • The transaction is a recurring payment and a previous authorization request was declined.
  • The merchant is suspicious of the transaction for any reason.
• Reporting a suspicious transaction. To report a suspicious transaction, the merchant must contact the authorization center, state "This is a Code 10" and await instructions.In all instances, except where the transaction exceeds the applicable floor limit, the merchant must inform the authorization center of the reason for the authorization request.
• Pick-up-card response. If a cardholder account is listed on the electronic Warning Bulletin or regional Warning Notice, the merchant must not complete the transaction. The merchant must retain the card by reasonable and peaceful means and notify the authorization center for further instructions. If the authorization center cannot be reached, the merchant must retain the card by reasonable and peaceful means until the center can be reached.

Obtaining an Authorization for Hotel, Cruise Line, and Car Rental Transactions

The following information and requirements are relevant to merchants obtaining authorizations for hotel / motel, cruise line, and car rental transactions.

• Authorization procedures. Hotel, motel, car rental, and cruise line merchants must comply with the standard authorization procedures and the requirements set out below.
• Initiating the transaction. When the transaction is initiated, the merchant must request an authorization for an estimated transaction amount if the estimate exceeds the applicable floor limit. The merchant also may request an authorization for any additional estimated amounts as needed. Merchants engaging in car rental transactions may not include charges representing either:
  
  • The vehicle insurance deductible amount, or
  • An amount to cover potential damages when the cardholder waives insurance coverage at the time of the rental.
  Car rental merchants must disclose to the cardholder at the time of the rental the amount for which the authorization was obtained.
  
  Charges for damages must be processed as a separate transaction. The merchant must provide a reasonable estimate of the cost to repair the damages and obtain agreement from the cardholder. If the cardholder chooses to pay for the repairs using his or her card, the merchant must:
  
  
  
  • Prepare a specific sales slip with proof of card presence.
  • Provide the estimated amount for repairs indicating that the amount will be adjusted accordingly pursuant to completion of the repairs and submission of the invoice for such repairs.
  • Obtain a signature from the cardholder.
  
  The final transaction amount may not exceed the merchant's estimated amount by more than 15% (or less, as directed by local ordinances). The merchant must submit a credit if the final cost of repairs is less than the estimated amount on the sales slip and has 30 days from the date of the subsequent transaction related to damages to submit the item into clearing.
• Completing the transaction. When the transaction is completed (i.e., when customer checks out of the hotel / motel or returns the car) and the final transaction amount is determined, the following will apply:
  
  • If the final transaction amount does not exceed the merchant's floor limit, the merchant is not required to obtain an authorization, but it must check the account number against the international Warning Notice or the Electronic Warning Bulletin.
  • If the final transaction amount does not exceed the merchant's estimated amount by 15%, the merchant is not required to request a secondary authorization. The initial authorization guarantees the full amount of the transaction.
  • If the final transaction amount exceeds the merchant's estimated amount by 15%, the merchant must request a secondary authorization on the additional amount.
  • If the final transaction amount exceeds the merchant's applicable floor limit, but a previous authorization was not received because the merchant's estimate did not exceed its applicable floor limit, the merchant must obtain an authorization for the full amount of the transaction.

If the card issuer declines a subsequent authorization request, the merchant is guaranteed the cumulative amount of previous authorizations, plus 15%.

If a pick-up-card response is received in response to a subsequent authorization request, the merchant must pick up the card. The merchant is guaranteed the cumulative amount of the previous authorizations, plus 15%.

Obtaining an Authorization when a Tip is Added

The following information and requirements are relevant to the merchant's obtaining of an authorization when a tip is added, either before or after the authorization process.

• If the transaction amount is below the merchant's floor limit, and the cardholder adds a tip in an amount less than or equal to 20% of the transaction amount, the merchant is not required to obtain an authorization even though the total transaction amount may exceed the merchant's floor limit.
• If a merchant obtained an authorization for a transaction, and the cardholder adds a tip in an amount greater than 20% of the transaction amount, the merchant must obtain an authorization for the additional amount. The card issuer is responsible for the full amount of the transaction.
• If the cardholder adds a tip in an amount greater than 20% of the transaction amount and causes the transaction amount to exceed the merchant's floor limit, the merchant must obtain an authorization for the total amount of the transaction.

Completing the Sales Receipt

The following information and requirements are relevant to the completion of the sales receipt:

• Include all goods on one sales receipt. All goods and services purchased in the same transaction must be included on a single sales receipt.
• Sales receipt information requirements. The following information must be included on the sales receipt.
  
  • A description of the goods. A description of the goods and services and their price, including applicable taxes, must be entered on the sales receipt in detail sufficient to identify the transaction. If no currency is identified on the sales receipt, the transaction is considered to have taken place in the currency that is legal tender at the point of interaction. If the merchant offers multiple currencies, then the sales receipt must indicate all of the following information:
    
    • The transaction amount in the merchant's local currency (the goods or services total).
    • The converted transaction amount in the currency chosen and agreed to by the cardholder and the merchant (the sale total).
    • The currency symbol of each.
    • The method by which the currency agreed to by the cardholder was converted from the amount in the merchant's local currency.
  • The transaction date. The transaction date must be entered on the sales receipt.
  • An imprint of the card. A legible imprint of the card must be made on the sales receipt, or the merchant may electronically record the customer's card information and the merchant location. If a transaction is completed without obtaining a card imprint or electronically derived card information, the merchant must note legibly on the sales receipt sufficient detail to identify the cardholder, the merchant, and the card issuer. This information must include at least the name and address of the merchant, the name or trade name of the card issuer as it appears on the face of the card, the account number, the security code, the expiration date (or dual date), the cardholder name, and any company name.If the transaction is completed without obtaining a card imprint or electronically derived card information, the merchant is considered to have verified the true identity of the customer as the cardholder, unless the merchant obtained and noted on the sales receipt independent evidence of the cardholder's true identity.Transactions based on mail orders, telephone orders, preauthorized orders, electronic commerce orders, Guaranteed Reservations and Advanced Resort Deposits may be completed without a card imprint.
  • The authorization number. If an authorization is obtained from the card issuer, unless the transaction is an offline chip-read transaction, the authorization number must be entered on the sales receipt. If more than one authorization is obtained over the course of the transaction (as may occur for hotel, motel, or vehicle rental transactions), all authorization numbers, the amounts authorized, and the date of each authorization must be entered on the sales receipt.
  • The primary account number. The primary account number (PAN) must be truncated on all cardholder-activated terminal sales receipts. Subject to local and national laws, PAN truncation is permitted on any other sales receipt type. It is recommended that only the last four digits of the PAN are printed on the receipt. Truncated digits should be replaced with fill characters such as "x," "*," or "#," and not with blank spaces or numeric characters.
  • Delayed presentment. When the merchant receives approval for delayed presentment, the authorization number and the words "Delayed Presentment" must be noted legibly on the sales receipt.
  • Cardholder identification. For unique transactions processed in a face-to-face environment (with the exception of truck stop transactions and card-read transactions where a non-signature CVM is used), the merchant must record on the sales receipt a description of the unexpired, official government document provided as identification by the cardholder, including any serial number, expiration date, jurisdiction of issue, customer name (if not the same name as embossed on the card), and customer address.
  • The transaction certificate. The transaction certificate is not required on the sales receipt. However, if the acquiring bank elects to record the receipt of a transaction certificate on the sales receipt, then the merchant must enter the complete transaction certificate on the sales receipt.
  • Prohibited information. The sales receipt or any other document must not reflect the following information:
    
    • The PIN, any part of the PIN, or any fill characters representing the PIN.
    • The card security code (CVC2, CVV2 or CID), which is indent-printed on the signature panel of the card.
• Obtain the cardholder's signature. In a face-to-face environment, the merchant must give the cardholder the option of a signature-based transaction. Unless the cardholder uses a PIN, the cardholder must sign the sales receipt.
  
  • Compare signatures. Unless the cardholder uses a PIN, the merchant must compare the signature on the sales receipt with the signature on the card to determine whether they appear to be the same.
  • Discrepancy between signatures. If the merchant believes that the signature on the card does not match the signature on the sales receipt, the merchant must contact the acquiring bank for instructions. The signature would not match if the signature panel were signed "John P. Smith" and the sales receipt "Stan Smith" or K. Smith." The signature would be acceptable if signed "John P. Smith," "J. P. Smith" or "John Smith." The signature would be acceptable if a title such as Mr., Mrs., or Dr. is missing or is included.
  • Signature not required. Transactions based on mail orders, telephone orders, preauthorized orders, electronic commerce orders, Guaranteed Reservations, Advanced Resort Deposits and Express Checkouts may be completed without the cardholder's signature. The merchant must type or legibly print on the signature line of the sales receipt the letters "TO", "MO", "PO", "EC", "Guaranteed Reservation / No Show," "Signature on File – Express Check-out," or "Advance Deposit" as appropriate. The merchant must retain and make available to the acquiring bank upon request the cardholder's written request to the merchant for preauthorization. The merchant must not deliver goods or perform services covered by a preauthorization after receiving notification that the preauthorization is canceled or that the card covered by the preauthorization is not to be honored.
• Give the cardholder a copy of the receipt. The merchant must provide the cardholder with a true and completed copy of the sales receipt.

Multiple Sales Receipts and Partial Payment

• Split tickets are prohibited. A merchant is prohibited from using two or more sales receipts, also known as a split ticket, to avoid an authorization request.
• Include all goods on a single sales receipts. All products and services purchased in a single transaction must be included in one total amount on a single sales receipt except in the following instances:
  
  • Multiple cards are presented. More than one card is presented for payment on a single transaction, and an authorization is obtained for the portion of the transaction charged to a each card.
  • Multiple items are billed. Multiple items are purchased and individually billed to the same account, and an authorization is obtained for each item purchased.
  • Partial payment. A merchant is prohibited from processing a card transaction where only a part of the total amount is included on a single sales receipt except in the following instances:
    
    • When the cardholder bills a portion of the transaction amount to a card and pays the remaining balance by cash or check.
    • When the products or services will be delivered or performed after the transaction date, one sales receipt represents a deposit, and the second sales receipt represents payment of the balance. The second sales receipt is conditioned upon the delivery or performance of the goods or services.
    
    An authorization must be obtained for the total amount of the transaction if it exceeds the applicable floor limit. The merchant must note on the sales receipt the words "deposit" or "balance," as appropriate. The sales receipt representing the balance must not be presented until the products or services are delivered or performed.

Returned Merchandise, Adjustments, Credits and Other Specific Terms of a Transaction

• Merchant disclosure of specific transaction terms. The merchant may impose specific terms governing a transaction. In the event of a dispute, such specific terms will be given effect, provided that such specific terms were disclosed to and accepted by the cardholder before completion of the transaction. The merchant may impose specific transaction terms by, for example, printing the specific terms on the invoice or sales receipt in close proximity to the cardholder signature line before presenting the invoice or sales receipt to the cardholder for signature. Specific transaction terms also may be disclosed by other means, such as by signage or literature, provided the disclosure is sufficiently prominent and clear so that a reasonable person would be aware of and understand the disclosure before the transaction is completed.Specific transaction terms may include, for example, such words as "Exchange Only," "In-Store Credit Only" or "Original Packaging Required for Returns." Specific terms may address such matters as late delivery, delivery charges, or insurance charges.
• Returned merchandise and canceled services. A merchant is not required to accept returned merchandise or the cancellation of services unless a right of return or cancellation was a condition of the transaction. If the merchant agrees to accept merchandise for return or to cancel services, the merchant must credit the same account used to purchase the merchandise or service.If the merchandise or service is purchased with a card, upon a partial or entire return of merchandise or cancellation of service, or if the merchant agrees to a price adjustment, the merchant may not provide a full or partial refund or adjustment by cash or check or by any means other than by a credit to the card account used to purchase the merchandise or service. The cardholder must be provided a copy of the credit receipt. A cash or check refund is permitted for involuntary refunds by airlines or other carriers or merchants only when required by law.
  
  • Credit receipt requirements. The credit receipt must contain the following information:
    
    • The date.
    • A description of the returned merchandise, canceled services or adjustment made.
    • The amount of the credit.
    • The merchant's signature.