Is offline CC processing frowned upon by merchants?

[estrange]

Provided that I use SSL will merchants get mad if I do this? I understand half of the number is stored on the server but I'm still worried.

Thanks

Louis

[kobra]

Exactly what merchants are you referring to?

Is offline CC processing frowned upon by merchants?
Provided that I use SSL will merchants get mad if I do this?

[estrange]

Exactly what merchants are you referring to?

Right now I'm looking at WellsFargo, Bank of America and Washington Mutual. I will be visiting their offices tommorow to get an idea of how it works. I might try Paypal too.

[kobra]

This is your bank/merchant account and they do not care how you choose to process your orders.
But, why not automate this process with a gateway processor

[SpeedRacer]

You can process your transactions offline if you want to, but...
somewhere on your monthly transactional statement, you should see somehere on there noted as the "qualification" of the transactions.

ie: on my statements from BofA...
on the bottom of the last page, there is a summary of X# of transactions qualified at x.xx% rate, Y# of transactions qualified at y.yy% rate and Z# of transactions qualified at z.zz% rate.

What that means is that for X # of transactions, you as the merchant paid X% to the bank for them to process the transactions for you.

The offline transactions (ie: hand keyed into a terminal) will normally qualify at a higher rate than say a swiped card.

An automated transaction will qualify at a higher rate than a swiped card too, but sometimes lower than the manually keyed transactions.

Automated transactions carry an ECI (ecommerce indicator) with them inside the banking systems, and therefore are auto-triggered as eCommerce related transactions.

For you as a merchant, if you are doing automated transactions, its MUCH better for you if you require the CVV number and force the BILL TO address to match the SHIP TO address. It still wont guard you from fraudulent transactions, BUT...it makes it a lot easier to defend against chargebacks.

Hope that helps shed some light on it.

I have been doing this in my day job for 15yrs now with some super high profile online storefronts, and it never amazes me what the banks do to manipulate the rates!

Later
Greg

[jumbuck2]

Actually SpeedRacer, I don't think that's quite right.

The ECI system is currently changing because its now possible to accept credit cards online with considerably improved security than with a real time payment gateway. I refer to e-path.com.au and payecom.com.au to name just two which have sacrificed automation for vastly improved security.

The other thing is the presence of the CVV number is absolutely no defence against a charge back. In that regards its a pretty useless thing really.

I agree that banks do whatever they can to earn as much as they can.

I'm with e-Path ad accept credit card payments from ZC and transact them myself into my merchant account. I have the opportunity to check the real physical address of the buyer, their phone, email and all other stuff before I do the charge. Not even card present can give you this much pertinent info on the buyer. Perhaps this is why e-Path is OK for accepting cc online and transacting manually yet is still flagged as a manaul transaction.

Cheerio

[SpeedRacer]

In an automated transaction, the ECI is transmitted to the institutions as part of your account configuration normally without your knowledge.
The ECI has nothing to do with the transaction other than to indicate to their platform that it was an automated ecommerce transaction.

ultimately its up to each aqcuiring institution to decide several things.
* how they qualify transactions within their own institution
* what rates they apply to the qualification levels
* what additional fees if any they tack on to it
* what rates they charge you as a merchant. trust me, the large companies with some legal muscle can get rates dropped significantly just through contract negotiation.

G

[SpeedRacer]

In reference to the CVV...

In the event of a chargeback....
*no a CVV is no defense of the chargeback.
HOWEVER:
IF you have the BillTO = ShipTo and provided the CVV at time of AUTH, obtained a good match for both ...then you stand a better chance of fighting back, than if you dont have the CVV at all. Hey, even with full VbV and/or MC SecureCode you cant fight all the chargebacks.

on another note, there are some CC brands (Discover for example) if you DONT provide "all available data at the time of authorization"...Disc reserves the right to charge merchants up to $0.75 per transaction fee for not providing the CVV....

[jumbuck2]

Yes I agree.

I guess this is why we are seeing a change within the system. Online ecommerce transactions are risky. To a point they are almost anonymous transactions being accepted live into your merchant account without you knowing. No wonder there are so many "add-on" and "plug in" security measures like verified by visa, mastercard secure code, etc. They all address the symptoms very well but not the core cause of the vulnerability (in my humble opinion).

If you have a look at either e-path.com.au or their rival payecom.com.au you will notice they don't do live transactions. Instead they put in front of the merchant the physical address, phone, fax etc. info so the merchant can check these before they decide to transact the charge.

My bank tells me this effectively negates quite a bit of the risks normally associated with online transactions (but not all). They gave me a slight % reduction in my merchant account fees after I told them I had been with the e-Path gateway for a while. Mind you my charge back record was zero because I identify fake orders that came in right at the start and delete them without entering then into my merchant account. But I think you need to show your bank you have a secure system that results in no charge backs before they agree to revise your merchant account rate.

As you can probably tell I'm a convert to the manual gateway alternative. Dead easy to integrate into ZC and much cheaper than your "real time" gateway. I don't mind one little bit charging the card numbers into my merchant account.

Cheerio

[Merlinpa1969]

just wait till you get busy,
once you spend ALL DAY 8 + Hrs manually handling credit card orders,
you will definitly change your mind.