Visa Chargeback Publication: More than Meets the Eye

I recommend every one of you who is responsible for payments, card processing, PCI for your campus download a copy of Visa's Chargeback Management Guidelines for Merchants (click here). It's a long pdf, but it is worthwhile.

Here are some of my favorite parts, and you'll notice this document (which I first learned about from Branden Williams' excellent blog) has a lot more than just Chargebacks. Actually, it's a pretty good primer on payment cards.

• Starting on page 10 is a great "Payment Card 101" that describes how a credit or debit card transaction flows through the system. The graphics are a lot slicker than the version I developed when I was at Visa (after all, it has been about 15 years!), and there is good text, too.
• Page 14 offers a description of "convenience fees." The short answer is "the merchant must [Visa's emphasis] adhere to Visa rules." Want to know what the rules are? Simple... "please contact your acquirer."
• Also on page 14 is one of my favorite topics: transaction laundering. It says that "Depositing transactions for a business that does not have a valid merchant agreement is called laundering. Laundering is not allowed." That means you don't process for unrelated third parties using your merchant ID. In fact, I wouldn't even allow a third-party merchant on my network. Either it is laundering (I call this "LaunderNet") or you are a Service Provider, and each is bad news from a risk and PCI perspective.
• Page 15 tells you not to do cash or check refunds for card transactions. You are supposed to issue a credit back to the original card used. Even if it isn't a Visa requirement, this procedure is a good idea since it prevents another form of transaction laundering: charging a transaction with someone else's card (e.g., their parent's or roommate's, with or without permission) then getting a cash refund. Bad news all around.
• Page 17 talks about your third-party service providers.
• Check out page 22 for good advice on your POS receipts.
• Page 35, and later page 80 cover the CVV2 (the security code on the back of the card).
• And of course, if you actually want to learn more than you ever wanted to know about chargebacks and copy requests, that all starts getting serious around page 41.

That Visa released this to the broader merchant community is to be commended. Good job! so do your part and download it now.