Return Authorization Mandates

New Visa/Mastercard regulations may affect returns/refunds, in rare cases
In light of the recent events surrounding COVID-19 epidemic, many merchants are issuing refunds to customers for products or services that can no longer be fulfilled. Some merchants are finding that the return authorization has been declined by their POS system or their payment gateway.

In 2019, Visa and Mastercard updated their refund authorization policies to reduce return authorization fraud and lessen the risk of chargebacks — both legitimate and fraudulent. This authorization an automatic step that usually requires no direct action from you. In some rare cases, merchants may find that their return authorization is denied. If that is the case, please have the customer reach out to the bank that issued their credit/debit card, typically the number on the back of the card.

If the customer is unable to secure the return authorization, make arrangements to refund the customer in an alternate way: check, store credit, or even cash. Depending on your policies, you may want to retain a copy of this alternate refund to prevent potential “double-dipping,” i.e. the customer also filing a chargeback and receiving a double refund.

While AMG has no control over the policies and procedures set forth by Visa and Mastercard, we understand that this may present an inconvenience in a rare number of cases. If you have any questions about your processing unrelated to this instance, please feel free to reply directly to this email.
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