Refunds and Fraud Prevention

How did credit card refunds originally work?

For a long long time, the rules were simple. You needed the entire card in front of you. When sending in a request for a refund, you provided the entire card number, expiry and amount.

About the Refund Rules (as we understand them today)

Credit card providers felt that the simple rule had too much potential for fraud. And it did: bad guys with cards figured out how to create a lot of refunds and steal a lot of money.

Each credit card merchant provider instituted one or more out of a number of rules to thwart fraud, making the refund process difficult. This generally works fine for one off refunds, but hampers the process when trying to do mass refunds to an entire event meaning it may need a lot of manual intervention.

What a Mixture of Rules means for Refunds

Some of the techniques credit card providers implemented that make the refund process difficult to navigate are below. Since the rules have been implemented over time, you may find that mass refunds might encounter one or more of these scenarios:

• Independent Refunds: payment refunds not linked to any order
• Linked Refunds: payment refunds must be the same order as original authorization
• Refunds using Merchant Profiles: payment refunds use an existing profile for the customer without needing card data
• Refunding when card data is shredded or non existent in the database
• Refunds accepted up to a certain amount of money and then stop being accepted
• Refunds Prevented for the first transaction in the day
• Refunds causing End of Day Imbalances due to some timing issues at the bank

NOTE: you can set which type of refund(s) your merchant provider allows in merchant setup If you are allowed both, Theatre Manager tries Linked refunds. If that fails, you can chose to do an independent refund on the payment window