Chargeback Guide [Edition 2.4]

Transcription

1 Chargeback Guide [Edition 2.4] About this document The Chargeback Process Chargeback Reasons Preventing Chargeback i

2 Chargeback_Guide Table Of Contents About this Guide... 1 Download this Guide... 1 Copyright... 1 Chargeback Guide... 2 Introduction... 2 The Disputed Transaction process... 3 Summary of the Disputed Transaction process... 3 The Request for Information (RFI) process... 5 The Chargeback process... 9 Reversing a Chargeback Reasons for a Disputed Transaction Card Validity Reasons Cardholder Dispute Reasons Authorisation Issues Processing Issues Request for Information (RFI) Reasons Prevention of a Chargeback Customer Service Fraud Prevention Appendix Appendix A - format Appendix B - Reason Codes Document Information Glossary of WorldPay terms Index ii

3 About this Guide Welcome to the WorldPay Chargeback Guide. This guide explains the process involved when a cardholder disputes a transaction. It also explains your role in the process and gives advice on how to reduce the number of Chargebacks that you receive. Note: This guide is specifically for WorldDirect customers. For information about this publication (issue dates, updates, readership and so on) refer to the Document Information chapter. We strive to produce the highest quality of documentation and welcome your feedback. Please send your comments to the editor@worldpay.com. If you have a technical question, please address it to support@uk.worldpay.com. Download this Guide A copy of this Help system is available in Adobe s Portable Document Format (PDF). You download the PDF file and then print it on your own printer. Click here to view and download the PDF file. Copyright 2004 WorldPay. All rights reserved. While every effort has been made to ensure the accuracy of the information contained in this publication, the information is supplied without representation or warranty of any kind, is subject to change without notice and does not represent a commitment on the part of WorldPay. WorldPay, therefore, assumes no responsibility and shall have no liability, consequential or otherwise, of any kind arising from this material or any part thereof, or any supplementary materials subsequently issued by WorldPay. WorldPay has made every effort to ensure the accuracy of this material. 1

4 Chargeback Guide Introduction A cardholder/shopper may wish to dispute a transaction. This can happen for a number of reasons including card misuse, genuine processing errors or the shopper being dissatisfied with the goods or level of service supplied. When a transaction is disputed, WorldPay, the card issuer and the acquiring bank operate clearly defined and well-established procedures to resolve the dispute. These procedures are designed to establish if you should receive (or retain) the disputed payment or if the funds should be returned to the cardholder s account. The process of returning the funds to the cardholder is known as a Chargeback. To reduce the number of Chargebacks and the loss of funds it is essential that you carefully monitor your disputed transactions and respond promptly to requests for information (RFIs) forward by WorldPay to you. If you are receiving a large percentage of disputed transactions you are required to take corrective actions to prevent disputes arising, by improving your response to RFIs and by enhancing your fraud prevention procedures. In this guide we outline the process involved when a cardholder disputes a transaction. It also explains your role in the process and gives advice on how to reduce the number of Chargebacks that you receive. Note: This guide is specifically for WorldDirect customers. The following chapters cover in more detail, the: Disputed Transaction process Reasons for a Chargeback Prevention of a Chargeback 2

5 Chargeback Guide The Disputed Transaction process Summary of the Disputed Transaction process The diagram below indicates the process we operate for WorldDirect customers in liaison with the Acquirer. If you are a Bank Acquired customer the process will vary in that the Request for Information (RFI) will be sent direct from your bank to you and WorldPay will only be involved providing the Customer Management System to assist you in producing documentation about the transaction. Flowchart of the Disputed Transaction Process 1. The cardholder /shopper queries an online transaction (refer to Reasons for a Disputed Transaction) with their card issuer. 2. The card issuer requests information about the cardholder's transaction from the Acquirer (this is known as a RFI, Request for Information). Note: If the cardholder denies involvement with the transaction the card issuer will not Request for Information (RFI) but will raise a Notification of Chargeback immediately, without prior notice. 3. The Acquirer forwards the RFI to WorldPay. If you have already refunded the transaction, WorldPay will notify the Acquirer of this and request that the RFI is defended on your behalf. 4. WorldPay marks the transaction as 'Disputed' and informs you of the RFI. You are informed of the RFI by an and through the Customer Management System. The amount of the dispute may be withheld from the next remittance due to you. 5. You are then required as a response to the RFI to send all the necessary information relating to the transaction, back to WorldPay. 6. WorldPay forwards the transaction information to the Acquirer who in turn sends it to the card issuer. 7. The card issuer considers the information in liaison with both the cardholder and the Acquirer and determines if the information was returned in the time frame (refer to RFI -Time frame) and whether it satisfies the cardholder's query. 8. If the transaction information does not satisfy the cardholder's query in accordance with the relevant rules, or the supporting documentation fails to arrive in the specified time frame 3

6 Chargeback_Guide (refer to RFI -Time frame), the card issuer will raise a Chargeback on behalf of the cardholder and send the details of the Chargeback (within the Chargeback Time frame) to the Acquirer. 9. The Acquirer forwards the details of the Chargeback to WorldPay. 10. WorldPay marks the transaction as a 'Chargeback' and informs you by an and through your Customer Management System. Note: At no point can you stop a Chargeback from occurring once the card issuer has raised it. Nevertheless, you may regain the Chargeback funds if you are a WorldPay Guarantee customer and have a valid claim under the terms of the Guarantee service or if you are successful in disputing a Chargeback using our Collection Assistance Service. 11. Within 14 days of the Chargeback advice the Acquirer will debit the full or partial amount of the cardholder's transaction to WorldPay, which will debit your account. 12. WorldPay settles the due WorldDirect funds minus the Chargeback amounts (if not previously reserved) and any related charges to you on your next settlement date. 13. If you then wish to dispute a Chargeback you can send details of the dispute to WorldPay's Collection Assistance Service, who will in turn send them to the Acquirer. 14. The Acquirer then sends the disputed details of the transactions to the card issuer, who then determines whether to reverse the Chargeback (refer to Collection Assistance process for further details on reversing Chargebacks). For further information about the processes involved in the event of a disputed transaction, refer to: The Request for Information process The Chargeback process Reversing a Chargeback The Collection Assistance process WorldPay Guarantee Service How did you rate this page? Did this answer you query? Yes No Comments Submit 4

7 Chargeback Guide The Request for Information (RFI) process Request for Information A Request for Information or RFI is a request from the cardholder's card issuer for copies of a signed sales receipt or other suitable supporting documentation that proves the cardholder's participation in the transaction. The following sections look in detail into the process of raising a RFI and an explanation the length of time in which you are required to provide the supporting documentation. Process Time frame How did you rate this page? Did this answer you query? Yes No Comments Submit 5

8 Chargeback_Guide The Request for Information (RFI) process 1. The cardholder/shopper queries an online transaction with their card issuer (for example, Mastercard, Visa, etc). (Refer to Reasons for a Disputed Transaction). 2. The card issuer requests information about the cardholder's transaction from the Acquirer (this is known as a RFI, Request for Information). Note: If the cardholder denies involvement with the transaction it may be regarded as fraudulent at this stage and the card issuer will raise a Notification of Chargeback immediately, without prior notice and without raising an RFI (refer to The Chargeback process). 3. The Acquirer forwards the RFI to WorldPay. The information provided by the Acquirer is limited to: Acquirer Bank reference Card Centre reference Your WorldDirect account number Transaction Reference Date of transaction Transaction amount and settlement currency Reason for the RFI The cardholder's name is not quoted. 4. WorldPay marks the transaction as 'Disputed'. Once a transaction is marked as 'disputed', it cannot ordinarily be refunded as the cardholder may already have been credited by the issuer and could therefore, benefit from a double credit at your expense. 5. WorldPay informs you of the RFI by an (refer to Appendix A) and through the Customer Management System. Note: WorldPay dispatches the RFI correspondence to your company address by default. If you wish to receive the RFI and Chargeback s to a specific address for your company or account, please inform WorldPay Customer Service of the requirement. 6. If you have previously refunded the transaction WorldPay will respond to the Acquirer on your behalf and ask that the RFI be defended. 7. You are required as a response to the RFI to send the following transaction information back to WorldPay. Mail order schedule (incorporating a description of the goods supplied) with proof of delivery signed by the cardholder. Copy of the sale (incorporating a description of the goods supplied) for a transaction, which clearly shows that the transaction was internet-based, with proof of delivery signed by the cardholder. Details of any refund made to the cardholder, not already made on your behalf by WorldPay and prior to you receiving the RFI. (Refer to Refunding a suspected fraudulent transaction) The more information you are able to supply at this stage, the more likely you are to avoid the potential Chargeback to your account. However, it should be understood that in arbitrating a dispute the issuer is unlikely to rule in your favour if the documentation supplied is absence of the signature from the cardholder and there is no proof of delivery of the goods or services. If you do not respond to WorldPay's request within the time stated, this will result in the issuer raising a Chargeback for 'non-receipt' of documentation. 8. WorldPay forwards the transaction information to the Acquirer. 9. The Acquirer forwards the transaction information to the card issuer. 10. The card issuer considers the information in liaison with both the cardholder and the relevant scheme rules and determines if the information was returned in the time frame (refer to RFI - Time frame) and whether it satisfies the cardholder's query. At this point the Acquirer can 6

9 Chargeback Guide dispute the RFI if the reason under which it has been raised is invalid or a refund had been processed to the cardholder's account before the RFI was raised. 11. If the transaction information satisfies the query, the card issuer will not raise a Chargeback and the transaction will become undisputed. If the transaction is undisputed it will automatically be marked as such after a period of time determined by the relevant scheme rules and the transaction funds will then be released and eligible for remittance. 12. If the transaction information does not satisfy the cardholder's query or the supporting documentation fails to arrive in the specified time frame (refer to RFI -Time frame), the card issuer will raise a Chargeback on behalf of the cardholder and sends the details of the Chargeback to the Acquirer. (Refer to, The Chargeback process for details on how a Chargeback is raised). How did you rate this page? Did this answer you query? Yes No Comments Submit 7

10 Chargeback_Guide RFI Time frame The Acquirer Bank and WorldPay must respond to RFIs from the card issuers within strict time frames determined by the card schemes. Note: If the card issuer does not receive a copy of the transaction receipt or supporting documentation within this time frame, it has the right to Chargeback the transaction. A chargeback can occur up to 6 months after the issuing of a RFI. How did you rate this page? Did this answer you query? Yes No Comments Submit 8

11 Chargeback Guide The Chargeback process A Chargeback is the process of returning transaction funds to the cardholder. The card issuer initiates the process after the cardholder has successfully disputed a transaction or it has been proven fraudulent. The following sections look in detail into the process of raising a Chargeback and an explanation in the length of time in which a Chargeback can be raised by the card issuer. Process Time frame How did you rate this page? Did this answer you query? Yes No Comments Submit 9

12 Chargeback_Guide Chargeback Process 1. Following a RFI (refer to RFI process) the card issuer considers the information you have provided. If this does not satisfy the cardholder's query, or fails to arrive in the specified time frame (refer to RFI -Time frame), the card issuer will raise a Chargeback on behalf of the cardholder and sends the details of the Chargeback (within the Chargeback - Time frame) to the Acquirer. 2. The Acquirer forwards the details of the Chargeback to WorldPay. The information provided by the Acquirer is limited to: Acquirer Bank reference Card Center reference Card Scheme Name Your WorldDirect account number Transaction Reference Date of transaction Transaction amount and settlement currency Reason for the Chargeback The cardholder's name is not quoted. 3. WorldPay marks the transaction as a Chargeback and informs you by an (refer to Appendix A) and through the Customer Management System. Note: WorldPay dispatches the Chargeback correspondence to your company address by default. If you wish to receive the RFI and Chargeback s to a specific address for your company or account, please inform WorldPay Customer Service of the requirement. 4. If the transaction has previously been refunded WorldPay will respond to the Acquirer on your behalf requesting that the Chargeback be reversed (this is known as a good faith procedure). There is no guarantee that such reversal will take place and the final decision rests with the card issuer. 5. Within 14 days of the Chargeback the Acquirer will debit the full or partial amount of the cardholder's transaction to WorldPay, which will debit your account. 6. WorldPay settles the due WorldDirect funds minus the Chargeback amounts (and any related charges) to you with the next due remittance. 7. If you wish to dispute a Chargeback you can send details of the dispute to WorldPay's Collection Assistance Service, who will in turn send them to the Acquirer. Refer to Collection Assistance process for further details on reversing Chargebacks. How did you rate this page? Did this answer you query? Yes No Comments Submit 10

13 Chargeback Guide Chargeback Time frame The Chargeback time frame varies depending on the reason for the transaction dispute and which card issuer raises the Chargeback. The cardholder/shopper can dispute a payment up to several months after the "purchase date" (the date the transaction is processed by the card scheme, the date of expected receipt of services or for travel services the expected date of travel). The card issuer has then typically up to 190 days from this day to successfully dispute and recover the payment on behalf of the cardholder. Any guarantee, membership or subscription period purchased as part of the transaction may be added to the 190 day period. For example, goods with a 12 month guarantee (as stated on the web site), can be fully or partially charged back within 545 days of the "purchase date". Considering the time frame involved, it is essential that you keep good documentation about all transactions and the delivery of the goods/services. The Customer Management System provides you with statements and reports about the transactions you receive but you must also be vigilant about keeping any delivery documentation and documentation containing the cardholder s signature. How did you rate this page? Did this answer you query? Yes No Comments Submit 11

14 Chargeback_Guide Reversing a Chargeback At no point can you stop a Chargeback from occurring once the card issuer has raised a Chargeback on a transaction. Nevertheless, you may be able regain the Chargeback funds if you have a valid claim under the WorldPay Guarantee or if you are successful in requesting the card issuer to reconsider the circumstances surrounding a Chargeback using our Collection Assistance Service. For further details on how to regain your Chargeback funds refer to: The Collection Assistance process WorldPay Guarantee Service How did you rate this page? Did this answer you query? Yes No Comments Submit 12

15 Chargeback Guide Collection Assistance process If you wish the card issuer to reconsider the circumstances surrounding a Chargeback you can perform a Collection Assistance attempt. The Collection Assistance attempt requires you to provide supporting documentation that the Chargeback is invalid or that you have corrected the original defect. We then ask the Acquirer to appeal to the card issuer (with your supporting documentation) requesting the reconsideration of their Chargeback decision. Reasons for an invalid Chargeback include: The issuer has processed the Chargeback, even though you refunded the transaction to the cardholder before the RFI was raised. The card issuer's RFI time frame expired, before you received the supporting documentation that the transaction was satisfied. Note: The card issuer is not obliged to view the supporting documentation, make a reversal or even reply to a Collection Assistance attempt. To use our Collection Assistance process refer to: Initiating a Collection Assistance How did you rate this page? Did this answer you query? Yes No Comments Submit 13

16 Chargeback_Guide Initiating a Collection Assistance To initiate a Collection Assistance attempt you are required to provide a valid reason with supporting documentation for the reversal of the Chargeback. Create a letter on your headed paper clearly stating that you would like to initiate a Collection Assistance attempt and why. Gather any supporting documentation that may assist in the card issuer's decision to reverse the Chargeback. Send the letter and the supporting documentation to WorldPay at: Remittance Department (Chargebacks) WorldPay PLC WorldPay Centre The Science Park Milton Road Cambridge CB4 0WE How did you rate this page? Did this answer you query? Yes No Comments Submit 14

17 Chargeback Guide WorldPay Guarantee Service WorldPay Guarantee Service The 'Customer Guarantee' is a transactional guarantee designed to protect subscribed customers against 'third party fraud' related Chargebacks, for example stolen credit cards. When Chargebacks arise as a result of third party fraud, WorldPay will deal with the issues related as part of this service. In conjunction with the Customer Guarantee you receive the 'Shopper Guarantee'. Research shows that 81% of online store owners feel that their sales would increase if shoppers were less concerned about fraud. For this reason WorldPay protects shoppers, who purchase goods/services on any WorldPay guaranteed customer web sites. This promotes the shopper coming back to the store, time and time again. Customer Guarantee The 'Customer Guarantee' provides protection for online transactions made on your store. Under this service WorldPay covers loss of funds arising from third party fraud on guaranteed transactions and provides you with an automatic warning mechanism of suspect transactions. The 'Customer Guarantee' will cover only transactions where we did not issue a fraud warning and which do not exceed 250 (or such other limit as may apply in individual cases). The terms and conditions applied to the guarantee service are set out in Schedule C of your Customer Agreement or are available on request. WorldPay also supplies up-to-date information readily available on our web site, regarding fraud so that you are aware at all times what to look out for and avoid. This service does not guarantee that Chargebacks will not occur (refer to Reasons for a Disputed Transaction). However, this service has been designed to enable you to process all transactions, and deliver your goods or services, safe in the knowledge that if you follow the agreed procedures and there is a problem where the cardholder has not made the transaction or the card details have been generated from another source that WorldPay will take the loss for the money and not you. Shopper Guarantee When using a WorldPay Guaranteed online store the fulfillment of all transactions made by the shopper, is guaranteed by WorldPay. The Shopper Guarantee also enables the shopper to dispute a transaction directly with WorldPay (accessed via if goods or services they have paid for are not delivered or are not in accordance with the transaction contract. This process will therefore reduce the number of cardholders/shoppers disputing the transaction with their card issuers. WorldPay will refer such disputes to you using a similar process to that for RFI s, and you must deal directly and promptly with the cardholder s dispute. In the event that the cardholder is not satisfied WorldPay will arbitrate on the matter and determine whether or not the cardholder should be refunded. If WorldPay determines that a refund should be made we will ask you to initiate the refund in the normal manner. Under the terms of the Guarantee WorldPay may also issue the refund for guaranteed transactions directly on your behalf and at your cost. WorldPay will arbitrate in favour of the cardholder where it appears that: 1. There is inadequate evidence that the goods or services purchased have been delivered within the stated delivery time. 2. The goods were delivered but were not fit for the purpose intended at the time of the transaction. To apply for the WorldPay Guarantee Service refer to our web site at: 15

18 Chargeback_Guide Reasons for a Disputed Transaction A cardholder / shopper can dispute a transaction for a number of reasons including misuse of their card, customer processing errors or if the shopper is generally dissatisfied with the goods or level of customer service supplied. The following sections describe the most common reasons why a transaction may be disputed. Card Validity Reasons Cardholder Dispute Reasons Authorisation Issues Processing Issues Request for Information Issues Disputed Transaction Reason Codes - This provide a detailed list of all the reason codes presented to you within your RFI/ Chargeback s. How did you rate this page? Did this answer you query? Yes No Comments Submit 16

19 Chargeback Guide Card Validity Reasons The card had expired at the time of the transaction. The card was accepted before it was valid. The card number is incorrect and cannot be applied to an existing account. How did you rate this page? Did this answer you query? Yes No Comments Submit 17

20 Chargeback_Guide Cardholder Dispute Reasons The cardholder did not receive the goods or services ordered. The cardholder returned goods to you. You agreed to process a refund, but the cardholder has not received a credit on their account. The cardholder cancelled their FuturePay agreement and the funds were still debited from their account. Note: SWITCH cards can not be used with a FuturePay Agreement The cardholder states that they did not authorise or participate in the transaction. The cardholder states that they paid for the goods or services by other means. The cardholder has received goods that are not the same as described when ordered. The cardholder received defective goods/services. How did you rate this page? Did this answer you query? Yes No Comments Submit 18

21 Chargeback Guide Authorisation Issues It is a breach of the card scheme rules to process transactions that exceed your ceiling limit, typically: Sterling transactions - GBP 10,000 US Dollar transactions -USD $10,000 Other currency transactions - the equivalent in that currency of the GBP 10,000. Note: Different levels may apply to different payment methods. If you receive a transaction above this amount we are unable to process the transaction and recommend that you arrange an alternative method of payment. You must not split a purchase above the ceiling limit into two or more consecutive transactions (each with their own authorisation from the cardholder) in an attempt to process them separately and achieve authorisation for the combined total of the purchase. This is called a "Split Sale" and is again in breach of the card scheme rules. All "Split Sale" transactions will be subject to Chargebacks and you will not be entitled to raise a Collection Assistance attempt to regain the transaction funds. How did you rate this page? Did this answer you query? Yes No Comments Submit 19

22 Chargeback_Guide Processing Issues The transaction was processed more than once in error. A refund transaction was processed as a sale. An incorrect amount has been processed or key entered. A card number (PAN) has been key entered incorrectly. How did you rate this page? Did this answer you query? Yes No Comments Submit 20

23 Chargeback Guide Request for Information (RFI) Reasons You have not replied to a Request for Information within the time frame (refer to RFI -Time frame). The documentation you have supplied is illegible. Responsibility is on you to provide legible copies of the required documentation, within the time frames stipulated. You have not supplied proof that the goods were received and signed for by the cardholder. It is important that you provide as much information as possible when you receive a RFI and that all the supporting documentation is legible. How did you rate this page? Did this answer you query? Yes No Comments Submit 21

24 Chargeback_Guide Prevention of a Chargeback When a shopper uses a credit card in person the proper checks are carried out at the point of sale (for example, signature check), and the card scheme rules ordinarily require the issuer to bear the any losses arisen. With online transactions, however, the liability for such a loss lies with you, because you do not have written evidence that the cardholder used the card and received the goods or services. It is not possible for you to avoid Chargebacks completely, however, the information in this section could help you reduce the number of RFIs and Chargebacks you may receive. WorldPay transaction authorisation does not prevent Chargebacks Authorisation of a transaction by WorldPay does not guarantee payment; it will only check the availability of funds at the time of the transaction and that the card has not been reported lost or stolen at the time of authorisation. Customer Service One way to reduce the number of Chargebacks is to provide good customer service and have a high quality of goods/services offered, as this will reduce the number of cardholders raising disputed transactions with their card issuer. For further information about providing high standards of customer service within your online store refer to: Improved Customer Service Web site Delivery of your goods/services Shopper Guarantee Fraud Prevention Fraud Prevention plays an important role in the reduction of the number of Chargebacks you receive and as such WorldPay has developed a number of fraud prevention facilities and procedure listed below: Manual review of transactions AVS / Security Code Deferred Processing Refunding a suspected fraudulent transaction Chargeback fees and removal of service If you receive a large number of disputes and Chargebacks you may incur additional Chargeback fees and card scheme fines. If the problem is excessive we have the right to remove the use of our payment service and close your WorldDirect account. How did you rate this page? Did this answer you query? Yes No Comments Submit 22

25 Chargeback Guide Customer Service Improved Customer Service Resolving a disputed transaction can be a time consuming and costly practice that detracts from your business and web site's reputation. To maintain a high customer satisfaction, the best measures are preventative: Ensure that your goods and services are described accurately Ensure that you have read and understood your WorldPay Customer Agreement Ensure that you indicate "internet transaction" on each sale Ensure that you clearly indicate your full company name on all transaction receipts. This ensures that a shopper can remember their transaction. Ensure that an transaction receipt is issued for each transaction and that any replies are dealt with properly and promptly. Provide the shopper with full contact details Supply as much information as possible when you receive a Request for Information (RFI) Keep good records of all transactions, including copies of the web site pages the shopper would have seen, invoices, refunds processed and delivery details Establish and display a comprehensive refund/returns policy, which shoppers must confirm before you accept their transaction The refund/returns policy should be proactive in dealing promptly and properly with all shopper disputes Establish and display a comprehensive Privacy Policy, as this will dispel shopper's concerns about providing personal data Offer free telephone customer service as it can help preserve sales and increase the relationship you have with your shoppers Provide " Customer Service" so shoppers can ask questions online. For customer service by you are required to have a standard response and time frame for responding to a shopper's query. Allow for extra time when processing FuturePay or repeat billing transactions as some shoppers will dispute a transaction in preference to canceling their agreement Register Internet shoppers by enabling them to enter their own user name and password. This will help in your relationship with your shopper and enable them to return and make additional purchases without entering some of their personal details again. How did you rate this page? Did this answer you query? Yes No Comments Submit 23

26 Chargeback_Guide Web site You can strengthen the relationship you have with your shoppers by using your web site not only to as a marketing tool, but as a risk management tool to avoid shoppers disputing transactions. To minimise the risk of disputed transactions your web site should display the following information: A complete description of the goods and services offered and details of any guarantee, membership or subscription period offered in the price Details of your returns/ refund policy - this policy should be consistent with your company's objectives and the type of goods/service that you sell. It should be clearly accessed from your web site and be printed on any invoices sent out Details of your privacy policy - to dispel shopper's concerns about providing personal data, your privacy policy should state which data is collected, who this information is shared with and how shoppers can opt out Details of any "Seal of Approval" by a privacy organisation Customer service contact, including address, phone number and address - so shopper can contact you directly when they have a query Transaction currencies in which you can deal Export restrictions (if known) Delivery policy and prices Country of domicile Import duty implications (where known) and clarity on whether import duty is included in the price quoted How did you rate this page? Did this answer you query? Yes No Comments Submit 24

27 Chargeback Guide Delivery of your goods/services Do not dispatch goods by whatever means (including online delivery) to a third party address (that is, an address other than the cardholder's address); this is considered very high risk Deliver goods/services on a timely basis and advise cardholders when they can expect delivery When delivering the goods, obtain the cardholder's signature to show proof of delivery. If possible take an imprint of the card at this point Notify the cardholder of any delay of delivery Retain documentary evidence of the delivery, together with a description of the goods/services supplied, for a minimum of 12 months. How did you rate this page? Did this answer you query? Yes No Comments Submit 25

28 Chargeback_Guide Fraud Prevention Manual review of transactions Often, the most effective tool against transaction fraud is to manually review each transaction. The list below provides a few suspicious circumstances, which may lead to a transaction fraud: A shopper ordering unusually large amounts of an item without any preference for the size, colour, make or model An existing shopper who suddenly orders a substantial volume of goods A shopper who provides you with more than one card to cover one order or a set of orders A shopper who orders more than once in a given day A first time shopper ordering a number of goods quickly A number of large orders from shoppers at a trade show A shopper who has attempted the same transaction more than once, with the card failing at the first attempt A shopper whose card issuer country does not match their delivery address. This information is shown on your receipts and within your Customer Management System (CMS) A shopper who refuses to confirm their credit/debit card and billing address details. A shopper who has purchased their goods /services from one of the following countries: Countries with high occurrences of Chargebacks Bosnia Bulgaria Croatia Egypt Indonesia Iran Iraq Israel Malaysia Nigeria Pakistan Romania Russia Serbia Yugoslavia As the process of reviewing each transaction by hand is both time consuming and expensive we recommend that based on the circumstances above you create your own fraud prevention rules, which flags such unusual transactions for further research. How did you rate this page? Did this answer you query? Yes No Comments Submit 26

29 Chargeback Guide AVS / Security Code The WorldPay payment system includes fraud prevention measures designed to help reduce your exposure to fraud and increase shopper confidence in online trading. One additional security facility is that WorldPay Payment Pages will now prompt your shoppers for their card security code and billing address. This information is then compared with the UK card issuer's records (where available) and the results of the comparison passed back to you for consideration. This additional transaction information is designed to help you decide if you should defer delivery, refund the transaction or research further about the cardholder. WorldPay and the Acquirer will not decline any transactions based on the card security or address verification. Note: This facility only applies for transactions where the card used was issued in the UK. AVS The Address Verification Service (AVS) enables the address, including postcode, entered by the shopper to be compared against the UK card issuer's records and the results passed back to you via an , your callback and the CMS. As part of this service the country associated with the shoppers address will be compared with the country the card was issued in. To use the AVS verification service the address entered by shopper must be their billing address (the address where the shopper's card statement is currently sent). The billing address must match the address held by the Card Issuer exactly. Security Code The Security Code verification service enables the card security code entered by the shopper to be compared against the UK card issuer's details and the results passed back to you via an , your callback and the CMS. The card security code is a number printed on the card. The number is not embossed on the card and hence not printed on receipts, making it much harder for anyone other than the cardholder to know what the code is. This will help prevent 'cardholder not present' fraud. A security code is now printed on the vast majority of credit/debit cards. The format and position of the security code varies across card schemes. Some cards have a threedigit number printed at the end of the cards signature strip. Some (AMEX cards for example) have a four digit number on the front of the card. Some card issuers refer to this number as the 'Security Code' (for AMEX cards) and others as 'Card Verification Value'. It may also go by the name of 'CVV2' for Visa Cards, or 'Card Verification Code' (CVC) for Mastercard/Eurocard. We provide our AVS/Security Code verification service in conjunction with UK banks and card issuers. We pass the information entered by the shopper to our banking partners who pass it to the card issuers for comparison with their records. The results of the comparison are then passed back, through our system, to you. Both the acquiring bank to whom we pass your transactions and the card issuer must also provide/support an AVS/Security Code verification system in order that the comparison can take place. Where either the acquiring bank or the card issuer does not yet provide support, we pass a 'not supported' message back to you. How did you rate this page? Did this answer you query? Yes No Comments Submit 27

30 Chargeback_Guide Deferred Processing WorldPay offers a service enabling credit and debit card transactions to be pre-authorised, whereby the shopper enters their card details, checks are then made on the submitted details and the transaction funds are reserved against the shopper s card. The transaction is not actually committed and therefore settlement to you will not occur at this time. By pre-authorising a transaction this enables you to perform any additional offline checks against the shopper details, and ensure that the order can be fulfilled. Once these or any other points have been checked, you must then "post-authorise" the transaction using your Customer Management System to ensure that the shopper is debited and that settlement to your account occurs. Note: Transactions that have been deferred are only effective for 5 days and if you do not subsequently "post-authorise" the transaction, it will lapse after this period. This means that the shopper's card will not be debited and you will not receive settlement of funds. This service is known as deferred processing and is not a standard WorldPay functionality. There are two main reasons why you may request deferred processing: For US customers the US law requires 2-stage transaction processing, as funds may not be taken from shoppers until the goods have been dispatched Additional checks can be made on the shopper to establish that the transaction was not fraudulent before completing the payment and delivering the goods Contact WorldPay at pre-auth@uk.worldpay.com for further information about how your can use the deferred processing mechanism for your company. How did you rate this page? Did this answer you query? Yes No Comments Submit 28

31 Chargeback Guide Refunding a suspected fraudulent transaction You can refund a transaction you suspect to be fraudulent, however, once you have received a RFI or a Chargeback, it is too late to refund the transaction. If you do so you risk losing the money twice. It is important, therefore, to action refunds promptly whenever you decide not to proceed with a transaction. For information about how to refund a transaction refer to your Customer Management System User guide. How did you rate this page? Did this answer you query? Yes No Comments Submit 29

32

33 Appendix Appendix A - format WorldPay sends an automatic when you receive a RFI/RFI reminder, a Chargeback or when a Chargeback has been reversed by the Collection Assistance or the Guarantee service. The examples below display the format for each of the s you will receive from WorldPay. RFI /RFI reminder Format We have received (a reminder for) the following Request for Information: WorldPay Account ID : Purchase transaction ID: Generated at: Transaction amount: The cardholder has contacted their Card Issuer and disputed this transaction. The following reason was given for this RFI :(refer to Appendix B for an explanation of the reason codes) Please forward any supporting information regarding this transaction to us in order to try and prevent any future chargebacks that may be incurred. Specifically required is any supporting documentation that bears the cardholders details, a description of the goods or services supplied and proof of delivery signed by the cardholder. Please be advised this information is required within 7 days from this . For more information about the RFI and chargeback process, or advice on how to minimise the risk of chargebacks, please refer to the WorldPay Chargeback manual available from Please do not hesitate to contact us, should you require further information, quoting the relevant transaction reference number. Regards, chargebacks@uk.worldpay.com RFI /RFI reminder Format when the transaction has been refunded Note: If the transaction has been refunded before a RFI was issued you will receive the following RFI We have received (a reminder for) the following Request for Information: WorldPay Account ID : Purchase transaction ID: Generated at: Transaction amount: The cardholder has contacted their Card Issuer and disputed this transaction. The following reason was given for this RFI :(refer to Appendix B for an explanation of the reason codes) As this purchase transaction has already been refunded we have requested the processing bank to cancel the RFI. Unfortunately we cannot guarantee that a chargeback will not ultimately be made. For more information about the RFI and chargeback process, or advice on how to minimise the risk of chargebacks, please refer to the WorldPay Chargeback manual available from Please do not hesitate to contact us, should you require further information, quoting the relevant transaction reference number. Regards, chargebacks@uk.worldpay.com 31

34 Chargeback_Guide Chargeback Format The following transaction has been charged back in full and accordingly your account with us has been reduced by the amount of the chargeback plus any additional charges, if appropriate. WorldPay Account ID : Purchase transaction ID: Generated at: Transaction amount: The transaction id for this chargeback is: Generated at: For further information on this and other transactions please view your online statement at: For more information about the RFI and chargeback process, or advice on how to minimise the risk of chargebacks, please refer to the WorldPay Chargeback manual available from Please do not hesitate to contact us, should you require further information, quoting the relevant transaction reference number. Regards, chargebacks@uk.worldpay.com Chargeback Format when the transaction has been refunded Note: If the transaction has been refunded before the Chargeback was issued you will receive the following Chargeback The following transaction has been charged back in full and accordingly your account with us has been reduced by the amount of the chargeback plus any additional charges, if appropriate. WorldPay Account ID : Purchase transaction ID: Generated at: Transaction amount: The transaction id for this chargeback is: Generated at: As this purchase transaction has already been refunded we have requested the processing bank to reverse the chargeback. Unfortunately we cannot guarantee that this chargeback will be refunded. For further information on this and other transactions please view your online statement at: For more information about the RFI and chargeback process, or advice on how to minimise the risk of chargebacks, please refer to the WorldPay Chargeback manual available from Please do not hesitate to contact us, should you require further information, quoting the relevant transaction reference number. Regards, chargebacks@uk.worldpay.com Reversal of a Chargeback by the Collection Assistance Following the appeal under the good faith procedure, we are pleased to advice that the following chargeback has been reversed in full and your account with us has been increased accordingly. WorldPay Account ID : Chargeback transaction ID: Generated at: Transaction amount: The transaction id for this chargeback reversal is: Generated at: 32

35 Index For further information on this and other transactions please view your online statement at: For more information about the RFI and chargeback process, or advice on how to minimise the risk of chargebacks, please refer to the WorldPay Chargeback manual available from Please do not hesitate to contact us, should you require further information, quoting the relevant transaction reference number. Regards, Guarantee Format Your claim under the guarantee has been settled and your account with us has been credited accordingly. WorldPay Account ID : Guarantee Claim Payment transaction ID: Generated at: Sale value: Guarantee Value (including refund of WorldPay charges): Purchase transaction id: Generated at: For further information on this and other transactions please view your online statement at: For more information about the Guarantee Service, please refer to the WorldPay Chargeback manual available from: Please do not hesitate to contact us, should you require further information, quoting the relevant transaction reference number. Regards, Customer Services. For queries about your Chargebacks mailto:chargebacks@uk.worldpay.com To send RFI supporting information mailto:rfiinfo@uk.worldpay.com Reversal of a Guarantee Claim Format Your claim under the guarantee has been reversed and your account with us has been debited accordingly. WorldPay Account ID : Guarantee Claim Payment transaction ID: Generated at: Guarantee Value (including refund of WorldPay charges): Sale value: The transaction id for this Guarantee Claim Reversal is: Generated at: For further information on this and other transactions please view your online statement at: For more information about the Guarantee Service, please refer to the WorldPay Chargeback manual available from: Please do not hesitate to contact us, should you require further information, quoting the relevant transaction reference number. Regards, Customer Services. For queries about your Chargebacks mailto:chargebacks@uk.worldpay.com To send RFI supporting information mailto:rfiinfo@uk.worldpay.com 33

36 Chargeback_Guide Appendix B - Reason Codes The reason codes in the table below are displayed in your RFI/Chargeback and your Customer Management System (CMS). ID SHORT REASON LONG DESCRIPTION No support documentation was received from previous request The transaction information requested/required was illegible or missing The transaction was declined or authorisation was not obtained 4 Other non Specific Reason 5 The transaction appears to be duplicated 6 The card was not valid or has expired An incorrect card account number was processed Fraudulent transaction processed - no cardholder authority Additional transactions were processed at the same location without the cardholder's authority This is a recurring transaction which 10 has been cancelled The card issuer was not provided with 11 the amount of the transaction in the correct currency The merchant did not obtain 12 authorisation for an amount which exceeds the ceiling limit The goods/services received were not 13 as described by the merchant The cardholder does not recognise the 14 transaction and is disputing it The cardholder did not receive the 15 goods/services The goods received by the cardholder 16 was damaged or defective The time frame (set by the card issuer) for you to send supporting documentation about a transaction has expired. The card issuer has received no documentation and therefore, will raise a Chargeback to regain the loss of the cardholder's funds. The card issuer has received no documentation or the documentation is illegible and does not prove of the fulfillment of the transaction. The card issuer therefore, will raise a Chargeback to regain the loss of the cardholder's funds. The transaction was declined or authorisation was not obtained. This reason is shown if there are multiple reasons for a disputed transaction. The transaction was processed more than once in error. The card had expired at the time of the transaction or was accepted before it was valid. The card number is incorrect and cannot be applied to an existing account. Possible fraudulent use of a card without the cardholder's permission. Possible fraudulent use of a card without the cardholder's permission to make additional transactions in your store. The cardholder has disputed a FuturePay agreement or funds are still being taken after the agreement has been cancelled. The card issuer has received the supporting documentation but it contains the amount of the transaction in an incorrect currency. The card issuer therefore, will raise a Chargeback to regain the loss of the cardholder's funds. An Authorisation error occurred when you split a purchase into two or more consecutive transactions and only received authorisation for the combined total. The card issuer has received the supporting documentation but it contains no proof of the goods/services received for the transaction. The card issuer therefore, will raise a Chargeback to regain the loss of the cardholder's funds. The cardholder has disputed the transaction with their card issuer, as they do not recognise the transaction. The cardholder has disputed the transaction with their card issuer, as they did not receive the goods/services. The cardholder has disputed the transaction with their card issuer, as they received damaged or defective goods/services. 34