Your MasterCard Dispute Administration Fee – Get to know it

Different types of fees are associated when processing a payment that is made with a MasterCard. These fees have been implemented by the acquirers, card networks and issuers. The Dispute Administration Fee, which is also known as DAF holds a prominent place out of them.

MasterCard would charge the DAF for all the inter-European and intra-European transactions that you do. The DAF for every cycle would be assessed automatically during the dispute process. Then the administration fee would be charged from the receiver and paid to the sender.

What is behind Dispute Administration Fee?

It is important for all the people who use MasterCards for transactions to have a clear understanding about DAF. Their official announcement clearly mentioned the justification for this administration fee. DAF is in a position to keep MasterCard users away from the hassle associated with merchant chargebacks. When the transaction amount was lower than the processing cost of issuer’s chargeback, the issuers will be forfeiting their chargeback rights. This imbalance has the ability to increase the costs of the issuer substantially.

DAF can also work as the incentive suitable for merchants who need to deal with fraud detection. The merchants will have to go through some hassle in order to figure out fraudulent activity on a merchant account. Then they will have to take necessary measures to revert it in order to stay away from merchant business problems. The Dispute Administration Fee can come to their survival in that kind of a situation.

Chargeback prevention comes in

Before the introduction of Dispute Administration Fee, merchants had to go through a lot of issues. In fact, it was a financial burden for them as they didn’t have any convenient method for chargeback prevention. DAF came out in order to provide a convenient solution to the above mentioned merchant business problem. As a result, the merchants have got the opportunity to stay away from loss of revenue. In addition, they don’t need to bear any financial losses that are associated with these disputes.

As you can see, Dispute Administration Fee is in a position to incentivize the merchants who go through dispute chargebacks, which can create a negative impact on their profits. Unfortunately, they still don’t have a clear understanding about the entire process that needs to be followed in order to compile the compliant cases.

It is important to have a clear understanding of DAF

As per the regulations of the MasterCard, issuers are provided with the right to issue an arbitration chargeback at any time they want. Then the financial institution will dispute the validity of the original transaction. If the issuer change the chargeback reason code or obtain new information from the cardholder, this could happen. It can also take place when the documents submitted by the merchant are incomplete or the submitted evidences are compelling. Therefore, it is extremely important for the merchants to have a clear understanding about the Dispute Administration Fee. It will assist them to stay away from the hassle associated with chargeback problems.

5 Mobile Payment Trends we learned in 2016

One of the things that merchant acquiring services providers should care  about are industry trends. Mobile payments is definitely one of the top trends to look at. In fact, the popularity of mobile digital payment processing is increasing on a daily basis.

Mobile payments would reach up to $3 trillion USD by 2021. Therefore, it is important to have a clear understanding about the mobile payment trends 2016. Here is a list of 5 digital or mobile payment trends in 2016.

Five mobile payment trends in 2016

1. China will play a dominating role in mobile payments

Countries in the Asian Pacific region such as China play a dominant role in mobile payments. In fact, 58% of the mobile payments that take place in the world happen in China. People in China prefer to use their mobile phones instead of personal computers. The introduction of more user-friendly mobile apps and the availability of smartphones have contributed a lot towards the above mentioned fact. People who live in rural areas of China have also started making transactions with the help of their smartphones. Mobile payment processing in China is on a significant increase.

2. The increasing popularity of mobile payments in UK and US

The popularity of doing transactions via an online payment gateway is increasing in the US and UK as well. At the moment, 17% of the consumer payments done in UK take place via mobile devices. On the other hand, 12% of the people in US make their payments with mobile devices. This percentage would rise up to 50% by 2020.

3. People prefer to make mobile payments for service oriented categories

It has been identified that people prefer to spend their money on service oriented categories through the internet. For example, they can do travel related purchases at a lower price tag via Internet. The same reason has contributed towards the popularity of media downloads, ticket purchases and food delivery services as well. People can easily make the payments for these services through their mobiles on the go.

4. Mobile commerce is driven by younger generations

Another of mobile payment trends in 2016 is the fact, that mobile commerce is extremely popular among younger generations. That’s because they grew along with the technology and they are using it a lot. They don’t have to go through any hassle when making a payment for something online through their mobile devices. The millennia prefer the convenience that is associated with mobile commerce. They also make mobile transactions on a regular basis when compared to other generations.

5. Remote mobile payments would dominate the world

We can consider remote mobile payments as the next big thing in mobile commerce. It is facilitated by the proximity payments. In here, people use their mobile phones as a substitute for payment devices when they are at a merchant outlet. This can help the people to make their lives easy because they just need to use the mobile phone in order to make a payment. Samsung Pay, Apple Pay and Android Pay are emerging trends at the moment and they would definitely take mobile commerce into a whole new level.

Skrill Introduces Rapid Transfer for uploading funds to e-wallets

Skrill has maintained an excellent reputation throughout the past few years by delivering innovative online wallet services and alternative payment methods to the people in need. Recently they introduced their instant banking option, named as Rapid Transfer. Rapid Transfer allows the Skrill consumers to upload funds to their online wallet and make online payments right from the bank account without leaving the merchant’s website. The consumers are able to authorize a payment with their bank account details and get benefits from the excellent online security measures of the bank.

Effective payment processing method

Rapid Transfer received much attention as an effective Skrill payment processing method soon after its introduction. At the moment, Rapid Transfer is only available for a selected number of countries including Germany, UK, Austria, Hungary, France, Italy and Spain. However, they are planning to introduce this new online payment gateway to other countries in the future. At the moment, Skrill has established partnerships with more than 100 banks from the countries mentioned above.

Rapid Transfer has taken traditional online banking to a whole new level. This online payment gateway is associated with enhanced security and the consumers can now make payments with peace of mind. In other words, it opens up a faster method of transaction for all online payments. Another impressive feature about Rapid Transfer is that it has been optimized specifically for desktop, mobile and other devices. Using this method, anybody can top up his/her e-wallet.

Rapid Transfer

Most of the people in today’s world prefer to make payments with their mobile devices. If you are looking for new online payment methods that are optimized for mobile devices, you should read this. Rapid Transfer is one of the best options available out there to consider. This online wallet keeps consumers away from multiple log-ins and they will be provided with a quick, seamless and secure experience. It only takes a couple of seconds for Skrill to verify whether the requested funds are available or not. If the funds are available, payment will be made to the merchant instantly. It can keep the consumers away from credit card processing as well.

Merchants appreciate Rapid Transfer

Rapid Transfer has not only impressed consumers, but also the merchants. The merchants will get the opportunity to receive instant payments for products or services that they sell through Skrill’s banking network. Rapid Transfer will not ask the merchants to register with any service in order to receive consumer payments. Moreover, it gives opportunity for the merchants to enjoy higher sales conversion rates. Rapid Transfer comes along with convenient integrated mechanisms as well.

Global credit card processing

This kind of payment method is fast, safe and a secure payment method available for the consumers to make payments to merchants. On the other hand, merchants prefer to receive payments through this method. It´s because of the benefits that are associated with it. Rapid Transfer has addressed the needs of consumers and merchants in today’s digital world. Soon it will be available for people in all parts of the world.

MasterCard “Selfie Pay” over Passwords?

Security is one of the key priorities. Passwords are a pain, it is time to move on. Retina scans maybe? No! finger prints maybe? Not even. Getting rid of passwords and introducing more selfies? This seems like a dream idea! Use a “selfie pay security solution” instead of a password.

Selfie pay security system by MasterCard:

CNNMoney interview with LevelUp founder

mobile payments future

What is the mobile payments future?

See what the future of mobile payments has to bring with CNNMoney interviewing LevelUp founder Seth Priebatsch.

 

Payment Gateway: What you need to know

A Payment Gateway enables online merchants to accept card payments and alternative payments securely by encrypting sensitive information and passing the transaction details to the acquiring bank. Acquiring bank then notifies the issuer bank that an account/card holder has requested a payment. A payment gateway facilitates the transfer of information between the online merchant and the payment service provider or the bank.

A number of payment gateways provide various screening tools to monitor transactions for fraudulent activity and tools to prevent fraud. Payment gateways also provide reporting facilities to merchants to keep track of their orders.

Payment gateway and payment process definition

Following is a simple process that defines the payment process (credit card processing) behing a payment gateway whether with Areto Systems or not:

  1. The customer’s web browser encrypts the information to be sent between the browser and the merchant’s server (an online shop). This is done via SSL (Secure Socket Layer) encryption.
  2. The online shopw then forwards the transaction details to the preferred payment gateway (e.g. AretoPay). This is another SSL encrypted connection to the payment server hosted by the payment gateway.
  3. The payment gateway forwards the transaction information to the payment processor.
  4. The payment processor forwards the transaction information to the card association (e.g., Visa/MasterCard)
  5. The processor acts as the issuing bank, if the customer uses an American Express or Discover Card. He directly provides a response of approved or declined to the payment gateway.
  6. Otherwise, the card association routes the transaction to the correct card issuing bank.
  7. The credit card issuing bank receives the authorization request and sends a response back to the processor (via the same process as the request for authorization) with a response code. In addition to determining the fate of the payment, (i.e. approved or declined) the response code is used to define the reason why the transaction failed. This can be because of insufficient funds or bank link not available.
  8. The processor forwards the response to the payment gateway.
  9. The payment gateway receives the response, and responds back to the online merchant’s web site.
  10. Although this seems complex, this entire process typically takes between 10 to 20 seconds.
  11. The entire process from authorization to settlement, considering the issuing bank transfered the funds, all the way to the acquirer or processor, typically takes 3 days.

What is an Automated Clearing House?

An Automated Clearing House (ACH) is an electronic network for financial transactions. It is generally used in the U.S. This clearing house usually processes large batched volumes of credit and debit orders. The first task done by the ACH is when a receiver grants the authorization for the originator to issue a debit or credit to an account. The receiver can be also known as the account holder,

Automated Clearing House

The originator can be a specific individual person, a company or a merchant. Every account is identified by the bank account number and the bank’s routing number. The vital step of this payment process is the authorization of the receiver/account holder – a transaction may not be initiated without prior consent.

The US embraces the new EMV system!

Finally, in October 2015 the much-debated Payment Networks’ Liability Shifty propagated with EuroPay, MasterCard and Visa (EMV) is coming into motion in the United States, and the US is moving towards upgrading its mobile payments security standards. It is a progressive development for financial organisations, banks, credit unions, retailers and credit card issuers and more.

Mobile payments security

Security is so much important. Retailers need to obtain new terminals that read credit cards designed with EMV computer chips. If they fail to do so, they will end up burdened with the liability for any fraudulent transactions at their stores. In this article, we will discuss and evaluate the new system, how it works and its effect on the business world. EMV basically stands for the three pioneers in the card issuing business, Europay, Mastercard and Visa. It is a standard that upgrades the security of a business transaction. Credit card companies will now issue credit cards equipped with computer chips. These chips appear as a small metallic square on the front the card.

 

Retailers have begun upgrading their checkouts by introducing new technology that reads the chips. Gone are the old days off swiping the magnetic strip of your credit card through the terminal. Now you will have to insert your card into the machine that will read your card, and approve your transaction.

 

This new system of mobile payments security prevents fraud, such that, it creates a new, unique code for each transaction, and this code cannot be used again. It does not share your card information with the retailor, instead, the EMV chip generates, a random, unique code. This system will prevent hackers to access your information. That will avoid the duplication and theft of credit card information.

 

How does the security system work

Now let’s take a look at how this system will work. You will have to enter a PIN and provide additional information. However, most cards require a signature rather than a PIN. Users who do use any of the above mentioned “fancy” credit cards, which approximately makes up more than half of the US population, do not worry, you will still be able to make your regular transactions provided your card is equipped with new magnetic chips. In the instance, that a retailer has not upgraded his technology with a magnetic chip reader, you will still be able to make your payment using your EMV card.

 

However, through the old-fashioned magnetic strip. In case, a hacker gets access to your information regarding that particular transaction, you will not be liable for the cast. The retailer will incur it. That is because he did not upgrade his technology according to the updated card-reading system. Indeed, this new upgraded system will prevent credit card fraud and theft. Maybe not entirely, but it will most certainly increase the security standards. These standarts will serve to prevent fraud and credit card hacking. However, chip technology only serves to prevent credit card fraud at terminals largely in stores and retail markets. The reason is that the EMV chip users usually frequent stores, and online markets. In the instance that you misplace your card, lose it in a public place or it is physically snatched from, the person who holds it will be able to use it.

See also:

Facts to consider before selecting a payment provider

Accepting online payments for startups

Why you need an e-wallet for playing online poker

E-Wallet for playing Online Poker

Find out you need to have an e-wallet for playing online poker. If you want more information about electronic wallets, you can read our article about them.

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Areto Payment Processing Services AG is a licensed Financial Intermediary and member of the VQF, a self-regulatory body approved by the Swiss Financial Market Supervisory Authority (FINMA) for the supervision of the financial intermediaries.