InOrder ERP on Top of New Credit Card Processing Mandates

As you may already be aware, several mandates from credit card associations are taking effect this month, and several of you have received notices and updates from your banks or your credit card processors. We have also received notice of these new mandates, and we would like to discuss how these changes affect InOrder.

MasterCard Numbers

Previously, MasterCard numbers were always prefixed with a “5.” As of October 2016, MasterCard will start issuing card numbers that begin with a “5” or a “2.” InOrder has been supporting this change since version  9.09.16.

13 to 19 Digit Card Numbers

Previously Visa, MasterCard, and Discover card numbers were issued with 16 digits, and American Express with 15 digits.  Now, per the mandates, card issuers may now begin using 13 to 19 digit card numbers. The only announcement we have to date related to this is that as of October 2016, Discover plans to begin issuing 19 digit card numbers. InOrder version 11.00.05 adds support for accepting 13 to 19 digit card numbers.

Authorizations

MasterCard has re-classified authorizations into two types:

  1. “Pre authorizations,” which allow the authorization amount to change, and which last up to 30 days.
  2. “Final authorizations”, where the amount is locked until settled, and which last up to 7 days.

The processors each may handle support for this change differently, but in most cases the processing will mimic the way it has always worked and so no action is required.

  • TransFirst will default the authorization type on Auth Only transactions to populate an Authorization Indicator with “Pre-Authorization.” TransFirst will default the authorization type on Auth and Settle transactions to populate an Authorization Indicator with “Final Authorization.”
  • Depending on the processor, CyberSource will provide a configuration option enabling you to flag all of your transactions as either “Pre,” “Final,” or “Undefined.”

For other processors, please check with your processor to confirm how this MasterCard mandate may affect your authorizations.

Capture Amount

MasterCard is changing rules for payment amount when capturing an authorized transaction. Previously some processors allowed you to set a percentage over the authorized amount that the capture could exceed by and still successfully capture. This provided for minor changes to an order after authorizing the charge that bumped up the order total slightly but did not require an additional authorization. Of course, this setting needed to match the overage allowance percentage supported by the card type and your processor, otherwise a decline could result.

After October 14, 2016, MasterCard is no longer allowing this feature except for restaurant & bar industry transactions. The capture amount can always go under the authorized amount, but after October 14 you can no longer go over it.

Authorization Reversals

MasterCard has mandated authorization reversals on non-settled authorizations. For MasterCard beginning in November 2016, a new Processing Integrity Fee will be applied if the authorization is not settled or reversed/voided before it expires. (i.e., 30 days).

InOrder has always voided authorizations when canceling prepayments; however for orders that do not ship and require a “reauthorization,” InOrder previously relied on the credit card processor to handle this, since they have always done it automatically. As of October 14, it will be the merchant’s responsibility to void authorizations.

InOrder 11.00.05 offers the ability to reverse authorize as part of the re-authorization process.  To accommodate this properly, InOrder will “void and copy” the originally authorized prepayment, followed by an immediate authorization of the new copy of the prepayment. Additionally, InOrder offers the ability to reverse the expiring authorization but delay the reauthorizations until their order is filled and ready to print. This option is the recommended best practice, allowing your customers full access to their credit lines while waiting for backorders and ship complete orders. This change also includes authorization / captures for PayPal processing, and we expect it to now be easier to process PayPal transactions as well.

Morse Data Development Teams have been busy this year. We are now in the final stages of a full PA-DSS software audit with Dara Security (www.darasecurity.com) for the new PCI version 3.2. Watch for more announcements about our PA-DSS audit soon.

Contact us if you need additional information about processing credit card payments with InOrder.

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