What happens if the credit or debit card from one of your customers is declined or flagged for pick up during a purchase?
I was asked recently about those messages. Here’s what they mean and how you should respond when processing a card transaction. Being aware of what to do – and then doing it – could save you from getting ripped off.
If you attempt to process a sale and receives a decline code, normally it means that the credit limit for a “credit card” or the checking account balance for a signature “debit card” is not large enough to cover the amount of the transaction.
This amount, referred to as the “open to buy,” must be larger than the amount of the transaction for the sale to go through. The approval or decline process is very simple: you either have the open to buy limit or you don’t.
It is rare that rerunning the transaction for the same amount will generate a different response.
Pick Up Card
In the case of a Pick Up Card message, the card issuer is alerting you that a transaction is being attempted on a card that the issuer would like to retrieve. The issuer? If you look closely at the back of a standard card, there is usually a note, in small print, that the card is the property of the issuing bank.
If a cardholder has had his or her card stolen, lost the card, or the issuing bank has closed the account, any attempt to process a transaction will generate the Pick Up Card message. If you can do it safely, you are asked to keep the card.
If this is not possible or especially if the cardholder demands the card back, by all means give it back to the customer.
If you are able to keep the card, once the cardholder leaves you should call your voice authorization center for directions on submitting the card to the appropriate card brand.
One of the scams we see on the rise involves a Decline or a Pick Up Card message. If the store staff is not trained properly, the cardholder uses his or her cell phone (or convinces the sales clerk to make the call) to contact someone at the issuing bank. In reality, the cardholder has called a friend who is impersonating the bank.
The fake bank employee then walks the clerk through the process to do a force transaction and provides a fake authorization code. The clerk thinks everything is okay … until a couple of days later when the transaction is returned as unauthorized. By then the merchandise is gone and the store is out the money.
The best advice is NEVER call the number on the back of the card or let the cardholder call “the bank.” Use your voice authorization center for that call. That way you can be sure you are speaking to a legitimate source for your information.
If you ever have questions about these types of issues, please call one of our customer service team members at 800.563.5981.
John Mayleben CPP is Retailers Processing Network senior vice president, technology and product development, and a national expert on electronic payment processing. He was the first person in Michigan and among the first in the nation to receive the Certified Payments Professional designation from the Electronic Transactions Association.