Merchants can send a $0 or $1 authorization along with the expiration date and sometimes AVS or CVV data to verify a payment card is valid before an actual authorization is submitted. This is the preferred method for account verification for most processors and the four main card types: VISA, MC, AMEX, and Discover and indeed is the only method when processing VISA® or MasterCard® transactions to avoid a misuse fee.

The misuse fee is only applicable for Merchants based in the U.S.

MasterCard and Visa misuse fee

VISA and MasterCard both charge a fee per misused authorization. VISA defines a misused authorization as: “Authorizations that are not followed by a matching clearing transaction (or in the case of a canceled or timed-out authorization, not properly reversed).’’ MasterCard has a similar Processing Integrity Fee that will be assessed per occurrence when authorized (approved) transactions cannot be matched to a clearing settlement record or an authorization reversal.

To avoid these fees, merchants should implement “pre-authorizations” (a.k.a. card verification transactions) as a $0 authorization with the preauthorized flag and if required/desired, the expiration date, AVS or CVV data as well. Note that AVS and/or CVV may be required for pre-authorizations by certain processors. See Table: Pre-authorization Support Summary below for more information regarding AVS/CVV.

In instances where only a $1 authorization is possible, an authorization reversal should be implemented within the designated timeframe to avoid the fees. You should check with your Account Manager at the Processor for the this timeframe.

B2B Payments best practices for account verification

As of September 18, 2014, XiPay converts authorizations that are marked as a pre-authorization to the appropriate amount of either $0 or $1 depending upon what the processor supports. So, for processors that do not support $0 authorizations, the XiPay platform will convert the $0 authorization to $1 as long as the pre-authorization flag is set. This is applicable for all B2B Payments processors for VISA, MasterCard, American Express, and Discover card transactions, except CyberSource. See Table: Pre-authorization Support Summary below for more information exceptions per processor.

Triggering account verification

The logic in XiPay to convert to the values defined in the table below is triggered by the combination of the presence of the Preauthorization Packet field set to any value AND an amount of either $0 or $1.

How XiPay handles account verification by processor

The following table defines:

The value that XiPay will submit to a given processor for each of the four main card types that support pre-authorizations, and

Any exceptions related to pre-authorization transactions for a given processor

Table Enter value: Account Verification Support Summary

Processor

VISA

MC

AMEX

Discover

Additional Notes and Exceptions

Adyen

n/a

n/a

n/a

n/a

There is no auto-conversion of account verification values performed by the XiPay Cartridge as of the publication of this document.

You should send the Adyen required values of $0 for Visa, MC, Discover, and AMEX transactions.

American Express CAPN

n/a

n/a

$1

n/a

As of October 2014, B2B Payments only supports $1 pre-authorizations for this platform. Misuse fees are not assessed for $1 authorizations for AMEX transactions as of October 2014.

Both AVS and CID are supported for $1 pre-authorizations.

Chase Paymentech Salem

$0

$0

$1

$1

Note that only $1 authorizations are supported for American Express and Discover transactions for pre-authorizations so XiPay will convert the amount if sent as $0 to $1.

Both AVS and CVV are supported for pre-authorizations for all card types.

Chase Paymentech Tampa

$0

$0

$0

$0

AVS data is required for MC, AMEX, and Discover account verifications. AVS is optional for VISA.

Note that a change is being made to make AVS optional for MC transactions in the future. The guide will be updated when this occurs.

CyberSource

$0

$0

$0

$0

Per CyberSource, due to varying rules and the frequent changes made by their backend processors, Clients should refer to their website to determine if the backend processor they are using supports $0 authorizations.

Note that by default, XiPay will convert the amount to $0 if a transaction is sent to the CyberSource platform with the pre-authorization flag set and the amount is set to $1.

http://apps.cybersource.com/library/documentation/dev_guides/CC_Svcs_SO_API/html/wwhelp/wwhimpl/js/html/wwhelp.htm#href=optional.08.51.html#

AVS and CVV support also depends upon the backed processor. The link above provides this information as well.

Digital River Netgiro

$1

$1

$1

$1

As of October 2014, B2B Payments only supports $1 pre-authorizations for this platform. For Merchants based in the U.S., we recommend performing an authorization reversal, to avoid a misuse fee for VISA or MC transactions.

Both AVS and CVV are supported for account verifications.

Elavon viaConex

$0

$0

$0

$0

Both AVS and CVV are supported for pre-authorizations.

For AMEX, $0 transactions require AVS be sent.

FDMS Nashville

$0

$0

$1

$0

AVS data is required for AMEX $1 authorizations.

Both AVS and CVV are supported for account verifications.

FDMS North

$0

$0

$0

$0

Both AVS and CVV are supported for account verifications.

Moneris eSelect

$1

$1

$1

$1

As of October 2014, B2B Payments only supports $1 pre-authorizations for this platform. For Merchants based in the U.S., we recommend performing an authorization reversal, to avoid a misuse fee for VISA or MC transactions.

Both AVS and CVV are supported for account verifications.

Ogone DirectLink

$1

$1

$1

$1

$0 authorizations are not supported by the Ogone DirectLink platform. We recommend performing an authorization reversal, to avoid a misuse fee for VISA or MC transactions.

PayPal PayFlow Pro

$0

$0

$1

$0

Both AVS and CVV are supported for account verifications.

TSYS

$0

$0

$1

$0

Both AVS and CVV are supported for account verifications.

Vantiv CNP

$0

$0

$1

$0

Both AVS and CVV are supported for account verifications.

Worldpay

n/a

n/a

n/a

n/a

There is no auto-conversion of account verification values performed by the XiPay Cartridge as of the publication of this site.

You should send the Worldpay required values of $0 for Visa and MC transactions. Account verification is not supported by Worldpay for Discover and AMEX.

Response handling

Merchants should always code against the XiPay StatusCode field for determining if a pre-authorization was successful or not. Successful pre-authorizations will return a StatusCode of ‘100’. It is important that the Message or AuthorizationCode NOT be used. This is because some Card Issuers do not return an Auth Code for $0 Authorizations and also because some processors return various descriptions in the Message field.