Frequently Asked Questions

General

What is a Merchant Account?

A merchant bank account is a type of financial institution or bank account that allows merchants to collect proceeds from consumer bank account or credit card payment transactions. A Card Present (CP) merchant account is used by merchants that process IP transactions received at a physical location, where payment is physically presented to the merchant by the customer at the time of the transaction. A Card Not Present (CNP) merchant account is used by merchants that receive payments electronically or in situations where payment is not physically presented to the merchant by the consumer at the time of the transaction.

What are the different types of Merchants?

• Retail - Retail applications quickly, efficiently and safely process transactions in a face-to-face environment. Whether you have a clothing store or are a doctor's office, we have the correct business application to suit your needs. Our retail solutions will work in a single merchant or a multi-merchant environment.
• Mail Order / Telephone Order (MO/TO) - MO/TO applications are designed with features that enable you to better manage the risks associated with Mail and Telephone Order transactions. Features such as Address Verification Service and CVV2/CID Verification allow you to better manage the risks associated with these types of businesses.
• Internet (eCommerce) - Business conducted over the Internet continues to grow. We have solutions to ensure that your e-Commerce transactions are being processed in a secure environment. Make sure you are protecting your customers and yourself by using only the properly encrypted products that are certified as secure by the INTRANNUITY Network.

Does Intrannuity store customer payment information?

For the purpose of risk management and to be able to process certain types of subsequent transactions (e.g., recurring billing, refunds), yes, Intrannuity will store customer payment information in a highly secured database for a limited period of time. However, all sensitive or personally identifying customer information that is stored by Intrannuity is masked in the Merchant Interface and in merchant reporting. In addition, in order to maintain compliance with several card association regulated security compliance programs, internal access to customer information is highly restricted.

Once customer payment information has been stored for 120 days (from the date it was originally received), the Intrannuity purges the full information and stores only masked information.

What is Interchange?

When you settle your transactions each day, the INTRANNUITY Network processes and sorts each transaction by card type. The transactions are then sent to their respective card associations (Visa or MasterCard) through Interchange. During this process, every transaction is assigned an Interchange category based on industry type and qualification elements e.g. swiped sale or forced sale.

Interchange is the system where transactions are submitted for payment from the Acquirer or Merchant Processor to the Card Issuer. The Card Associations (MasterCard or Visa) establish the rules and manage the Interchange of all transactions. Interchange also represents the fees paid by the merchant acquirer to the Card Issuer — Fees depend upon the Interchange Qualification that is assigned to each transaction by the associations for processing transactions. These fees are paid at the time the transaction is exchanged and vary based on processing method utilized. For example, it is significantly more expensive to process a hand-keyed transaction than a card-swiped transaction.

How can I make certain my transactions qualify at the best rate?

Interchange and Card Association fees vary in amount based on industry type, the degree to which cards are authorized, and the timeliness of remitting a sale for payment. There are several rates that may apply to your transactions, depending on your method of processing each transaction. When setting rate qualification criteria, the card associations consider the card product used in the transaction, how the transaction data is entered into the terminal, the time of settlement versus time of authorization.

What is SSL - Secure Socket layer?

Secure Sockets Layer (SSL) is an Internet protocol that safeguards electronic communications between two or more computers. For a communication or transaction that is transmitted over an “end to end” SSL connection, the computer initiating the transmission will open an SSL connection. This means that when Computer A sends a request to Computer B to transmit information, Computer A will include a digital certificate—a complex authentication tool that is basically a third-party issued certification that Computer A is a trustworthy source. Computer B then accepts the transmission and, in the event that Computer B has information to return to computer A, the SSL connection may remain open until the transaction between the two computers is complete.

Server-side SSL can also be used in the event that Computer A doesn’t have the necessary digital certificate or the ability to open an SSL connection to submit a communication to Computer B. However, Computer B may have some other means of authenticating the trustworthiness of Computer A or other computers that are submitting communication requests. Any transmissions sent to other computers by computer B will be transmitted via an SSL connection to those computers. In this case, the SSL connection is terminated once Computer B has completed its transmission.

When transmissions are sent over an SSL connection, they cannot be intercepted, viewed or modified by other parties on the Internet. As such, customer payment information is transmitted securely.

What does IP - Internet Protocol mean?

Internet Protocol (IP) is the method of transmitting information and communications between computer systems and networks via the Internet. For the payments industry, the ability to use IP to transmit customer payment information directly to the processing network has revolutionized the way merchants run business—opening doors to a wide range of new payments acceptance opportunities, including from Web sites and wireless devices, to helping store-front merchants cut costs and speed up checkout lines.

What is Recurring Billing?

IBILLING is Intrannuity's subscription managment system that allows merchants to create a recurring billing schedule or “subscription” for the purchase of goods or services. Merchants enter transactions and customer billing information, specify a billing amount and billing interval and IBILLING does the rest—automatically generating subsequent transactions for the duration of the subscription.

What is a Virtual Terminal?

The Virtual Terminal is a feature of the Merchant Interface that allows merchants to manually key in and submit transactions easily and quickly.

Chargebacks

What is a chargeback?

A chargeback is a transaction disputed by the cardholder or card issuer. There are many reasons for chargebacks, but the most common are returned merchandise, terminated services, disputes, errors, or fraud. Merchants must be able to provide proof that the disputed transaction is valid and in accordance with Visa/MasterCard regulations or risk having their account debited for the disputed amount..

What does a chargeback mean to me?

For your business, a chargeback translates into extra processing time and cost, a narrower profit margin for the sale, and possibly a loss of revenue. It is important to carefully track and manage the chargebacks that you receive, take steps to avoid future chargebacks, and know your representment rights. In addition, you should also take measures to recover losses from customers who are financially liable for transactions that were charged back to your business.

How do I avoid chargebacks?

To avoid chargebacks, act promptly if contacted directly by the cardholder to resolve a dispute. By working directly with the cardholder, you can avoid costly fees and processing costs as well as promote goodwill with your customer. If the cardholder does not contact you, respond to inquiries from Merchant Services with as much information as possible about the sales transaction in question.

While it may not be possible to eliminate Chargebacks entirely, you can reduce their occurrence by resolving issues and disputes directly with the Cardholder and following the proper Authorization and processing procedures. Because Chargebacks can be costly, you should make every effort to prevent them. Some useful tips.

• Avoid duplicate processing of a transaction and follow the proper procedures for settling your daily transactions.
• Work with the cardholder to resolve disputes regarding the quality of merchandise or services rendered.
• Refuse to process a transaction when you receive a Declined Code during Authorization.
• Call for Voice Authorization, if needed. Call for a Code 10 Authorization if you are still suspicious of the cardholder, card, or transaction after receiving an Approval Code.
• Include a description of the goods or services on the transaction Receipt.
• Deliver merchandise or services before charging the Card.
• Obtain an Authorization Code.
• Include the CVV2/CVC2 and AVS codes for card not present transactions, if applicable.
• Submit transaction receipts on the same day the transactions are authorized.
• Make sure an imprint appears on a manual transaction receipt or that the relevant transaction information appears on the terminal-generated transaction receipt.

Not accept expired cards or cards having effective dates prior to the date of the Transaction.

Fraud

How do I protect against fraud?

Non Face-to-Face Transaction Fraud

As more and more business is transacted via the internet or over the phone, there is a greater opportunity for fraudsters to use this remote marketplace to impersonate real customers or use illegitimate cards or checks to rip off businesses. Here are some examples of potentially fraudulent transactions to watch out for at your business.

• Relay calls - A relay call is an operator-assisted telephone call, typically used by someone who is hearing impaired. While this is a valid service, criminals have also used the service to place fraudulent orders. We recommend you request a "Code 10" authorization request for all orders obtained via relay call.
• Bulk orders - Customers ordering large quantities of the identical or similar items. You should also be cautious of large bulk orders with a delivery address of an apartment or self-storage unit.
• Multiple cards - Customers who provide multiple card numbers for the same purchase, especially when the card numbers are different by only the last few numbers.
• Money is no object - Requests for overnight delivery, without regard to cost.
• Immediate shipment - Customers who request immediate processing of the order and want the shipment's tracking number ASAP.
• Immediate pick up - Customers who place phone orders, request immediate processing of the order, and then advise they will have someone come to the store to pick up the product.
• Alternate delivery address - Requests for delivery to an address other than the billing address, or delivery to a freight forwarder. (Criminals will use United States based re-shippers to avoid detection of foreign shipments.)
• Not sold here - Telephone or online requests for merchandise you do not sell. Most common requests are for cell phones and laptop computers.
• Free email orders - Communication via a free email service (Yahoo, Hotmail, Gmail, etc).
• Excess funds request - A customer may request that you process a transaction for an amount greater than the purchase price of the goods or services and then send the excess funds by wire transfer, money order or Western Union® to a freight forwarding company or other person. Not only is there a high probability of fraud for such a transaction, there is little chance for your business to recoup funds. This type of transaction is a violation of regulations, so you would not have the ability to favorably resolve a chargeback should it occur.
• Counterfeit check scheme - The fraudster overpays for goods or services with a counterfeit check and requests you to wire transfer the difference back to them or an accomplice. This scheme has been reported on personal checks, business checks, cashier's checks and money orders. It results in a loss of both the merchandise and the cash overage.
• Fraudulent customer ID - With today's technology it is possible to alter a photocopy of a credit card or personal identification such as a driver's license or passport. Sometimes a fraud order will include a faxed or e-mailed photocopy of the card to gain your trust. These photocopies do not guarantee that you are dealing with the correct cardholder. Always verify the order information with the authorization center before proceeding with the order.

Employee Fraud

Employee Fraud - The Threat Within

Sometimes the fraudsters you must guard against are right inside your own organization. Employee theft of customer information is a growing challenge for businesses. A number of advances in technology have made it easy for unscrupulous employees to steal customer credit information. Lax security procedures can also allow employees to pilfer or misuse the data.

Here are some typical ways employees can perpetrate credit card fraud:

• Process a credit transaction to their own account - Employees may issue credits to their own credit card or to an accomplice's card using the Merchant's Point of sale(POS) device using funds meant for the merchant's direct deposit account.
• Record card numbers - Employees may pocket receipts left behind by cardholders or may copy card numbers onto a separate piece of paper. POS terminals that truncate the card number on the customer's receipt can help your business avoid this type of fraud.
• Use a card skimmer - A dishonest employee can steal valuable information off a customer's card through use of a small, battery-operated "card skimmer." This hand-held device reads a card's magnetic stripe and records the cardholder data for later download to a computer. From there, the numbers can be used to make unauthorized purchases or create counterfeit cards.

Other Suspicious Employee Activity

Employee fraud can take other forms as well. Sometimes, it doesn't directly involve processing a card transaction, but is suspicious nonetheless.

Here are some clues to potential employee theft.

• Deposits not made within normal time frames (i.e. daily deposits not occurring daily), or deposits not received by your bank.
• Credit card receipts not retained as per company policy.
• Frequent errors in applying customer payments, or customer complaints of payments not being applied to their accounts or only partial payments being applied when the customer paid in full.
• Discrepancies between deposit receipts obtained from your bank and deposit receipts kept internally.
• Decrease in volume of cash received while other payment type volumes remain unchanged.
• IOU's in cash reserves or "petty cash."

How to Combat Employee Fraud

Despite the opportunity for employee fraud, you as a merchant are not totally without protection. Most terminals or transaction software tools allow you to require a password in order to process a credit transaction, and there are a number of other tactics you can use to prevent employee fraud:

• Reconcile your work daily rather than monthly.
• Password protect the credit function on your POS device, or the POS device itself.
• Secure your POS device during non-business hours.
• Have a separate authorizer of credits in addition to the person who physically processes a credit.
• Make sure all credits have accompanying internal documentation of customer information (name, and contact information) and reason for return or dispute.
• Match credits to returned or disputed goods or services, verify with customers that they did actually return / dispute goods or services.
• Have more than one person review monthly statements.
• Send all credit transactions to a central office for review.
• Review credits daily, or have a trusted employee do the review.
• Fully investigate credits without matching sales.
• Review any batches with negative dollar amounts (more credits than sales).
• Conduct regular internal audits at random times and intervals.
• Audit bookkeeping and accounting processes quarterly.
• Track credits by card number, terminal number, employee, frequency, and dollar amount (exception based reporting).
• Review any volume spikes in credit / return / dispute activity.
• Review your monthly statements with your physical inventory.
• Inquire about additional products or reports available for review of credit card transaction detail, i.e., MerchantConnect Premium.
• If you use something other than a payment terminal to process transactions (e.g. an electronic cash register with integrated payment features), discuss additional controls and/or reporting with your point-of-sale provider.
• Protect your passwords and verify internal access controls for online account reporting, and checking account change requests.

How do I contact the Associations for assistance?

• VISA Merchant Verification Service 800-847-2750 AUTOMATED
  Option 1, Address Verification: enter in the numeric portion of the street address, zip code, and VISA card number and it will advise you if there is a match. Option 2, Issuing Bank Phone numbers: enter the VISA card number and it will provide you with the 800 number for the issuing bank if available.
• MasterCard Assist 800-622-7747
  Select your language preference, then Option 2. Enter the MasterCard card number and it will provide you with the 800 number for the issuing bank if available.
• Discover Address Verification 800-347-7988 AUTOMATED
  You will need your Discover Merchant number. Enter the Discover card number and address information, and it will advise you if there is a match.
• American Express Address Verifications 800-528-2121
  Option 3 allows you to verify the name and address of a particular AMEX card number.