By Vicki Ytzen

Effective November 1st, 2011 MasterCard is expanding the existing authorization reversal mandate to include all MasterCard branded transactions which includes Credit, Debit and Prepaid for all merchants except for those with the following Merchant Category Codes:
· 3351-3441 – Car Rental Agencies
· 3501 -3999 – Lodging – Hotels, Motels, Resorts
· 4411 – Cruise Lines
· 7011 – Lodging – Hotels, Motels, Resorts – not elsewhere classified
· 7512 – Automobile Rental Agency – not elsewhere classified
(If you’re not sure which Merchant Category Code you’re set up with, please contact your Relationship Manager at 1-800-704-7253)

What does this mean to you??
If you ran a transaction and your customer changes their mind, you need to do a FULL REVERSAL for the full dollar amount or a PARTIAL REVERSAL if the amount is less than what it was originally ran for. These Reversals give the merchant the ability to return funds to their customer in real-time while in the current batch. Also, some merchants place partial holds on a customer’s card for special orders and then forget to release the hold.

What is a Miss-Use Fee on my statement?
REVERSALS for Face to Face transactions must be completed within 24 hours. For non Face to Face it’s 72 hours. If you fail to comply, MasterCard will assess a Processing Integrity Fee, or also called a Mis-Use Fee that will appear on your monthly statement.

What’s the difference between Reversal, Refund/Credit and a Void?
If your customer changes their mind on a product/service that same day and you hadn’t settled or batched your terminal yet, you would want to do a REVERSAL. If it was after you settled or batched you would do a REFUND. At the end of the day, you print a detail report and see that there is an error with a transaction, or you decide you don’t want to process that particular transaction; you then would also do a REVERSAL which is the same thing as a VOID to remove that transaction before you settled or batched. Technically, after the required update to your terminal is completed, REVERSALS and VOIDS will do the same thing.

The necessary terminal updates will become available in the near future!