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Impact of Changing a Merchant Provider

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Changing your Bank is not the same as changing your merchant provider. You can change either/or at any time. Refer to the basic definitions used the credit card industry for more information on roles and responsibilities of either.
You can change your merchant provider to any of the supported credit card processors at any time you want. But be very aware of the impact on future refunds as discussed below.


Advantages of Changing Merchant Provider and/or Processor

You may get various benefits such as:

  • more amenable rates
  • better service when you call them for help
  • more supported features such as hosted payments online or pin pads


Disadvantages of Changing Processors

There are disadvantages of changing service providers - most notably:

If you suspect you might have a significant number of refunds to do for upcoming shows that are or could be cancelled, you might want to:

  • hold off on changing your merchant provider until such a time you've got a low exposure on the need to do refunds -or-
  • Migrate to the new merchant account, while keeping the old one available/active for future box office returns for a period of time - say a few months, if that option is possible.


Why are refunds problematic during Merchant Changeover?

In recent years, merchant providers have instituted fraud policies that apply one or more of the following rules (Linked Refunds) that mean refunds

  • must within a certain number of days of authorization (normally 120, but can sometimes be extended)
  • to the same card that was used to purchase
  • with a token provided by the merchant provider (changing merchants nullifies the token)
  • up to the same amount on the original purchase
  • using the same order number
  • to the same merchant provider

The rules above are imposed by the credit card companies and they can change at any time. If you change a merchant provider, then at least 3 of the rules above are viiolated:

  • #3 (the token),
  • #5 (the same order number),
  • #6 different provider

The new merchant provider will not allow refunds for any charges done by the old merchant provider.

You may need to ask the new merchant provider to approve you for independent refunds - which they may charge more for, or may not give you that permission.

Note, that Independent refunds of a card used with a new merchant processor means you must ask the patron for their card number again. (linked refunds do not need you to get the card).

Alternatively, you many need to keep your old merchant provider setup available for a few months for refunds only - until your risk of needing to do a refund to the old provider is past.