ClearAuth®: Frequent Asked Questions (FAQs)

What are the Chargeback Reason Codes covered by Verified by Visa and MasterCard SecureCode?
Visa USA: United States
Credit & Check Cards – Authentication & Attempts
23: Invalid Travel & Entertainment
61: Fraudelent MO/TO/EC
75: Cardholder does not recognize transactions
Visa USA: International
Credit & Check Cards – Authentication & Attempts
23: Invalid Travel & Entertainment
83: Fraudelent MO/TO/EC
MasterCard
Credit & Debit - Authentication
4837: Cardholder non-authorization
4863: Cardholder not recognized

I can't believe I will get 100% protection from Visa. Are you sure there are no transaction thresholds?
Visa protects you, as the merchant, by blocking ALL chargebacks for reason codes 23, 61, and 75 (domestically) and 83 (internationally) when you “successfully authenticate and when you attempt” (cardholder and/or issuer are not participating) to authenticate the transaction. There is no limit as to the number of transactions that are protected, regardless of transaction amount.

Does MasterCard give me the same kind of protection?
The MasterCard SecureCode program offers protection by guaranteeing payment and blocking chargebacks for reason code 37 for those transactions that have been authenticated (cardholder enters their PIN) only.

Are my international, Internet sales protected?
SecureCode and VbV are global programs. Therefore, both programs are valid and operating worldwide.

What are the differences in operating rules for non-US cardholders?
The initiative operating rules are applied by region. So, you should check a specific region's business rules to understand the exact differences. Interchange rules differ by region, as well.

What's to stop an Issuer from just changing the reason code from 61 or 37 to something else just to get it through?
Using a different reason code (such as non-receipt of merchandise) puts the burden of proof back on the consumer and/or Issuer to “prove” or substantiate the reason for the chargeback. Merchants will finally be given a chance to “fight” those type reason codes through other sound business practices they have in place. They will no longer be “stuck” just because the consumer says, “I didn't do it”. In addition, Visa and MasterCard will be periodically monitoring the reason codes for possible addition into the VbV and SecureCode programs if they warrant the change.

So, if I start authentication then should I stop doing my other fraud screening?
Authentication is one fraud tool you should use. And, once you have been able to evaluate its effectiveness on your overall fraud problem, you should evaluate other fraud products you may be using as to their usefulness and value. Those products that you are using that may be costly may no longer be needed if authentication has helped to significantly reduce fraud and chargebacks. But, this should be a business decision made only after you've had a chance to measure the effects and savings of authentication. In addition, remember, to receive the benefit of the Visa Interchange relief you must also do Address Verification Service (AVS).

What happens if a cardholder/shopper is not enrolled?
If a cardholder is not enrolled in either program, then the checkout process will continue on as normal. No authentication screen will be presented.

What happens when a transaction is not authenticated?
If a cardholder is enrolled in one of the programs, but fails to successfully authenticate themself, the merchant may still accept the transaction, but would not receive fraud liability protection and would not be guaranteed payment on the transaction.

How is the ClearAuth® software deployed?
ClearAuth® is deployed as an ASP hosted solution. To enable ClearAuth®, a merchant must install the ClearAuth® Client on their checkout page. The Client serves as a conduit to our centralized authentication servers which host our Merchant Authetication Processing Server™ (MAPS).

Is the service difficult to install?
No. A typical installation takes about 1-3 hours.

Is the service compatible with my site?
Yes. We have a variety of different versions of our Client for use with various technologies. Our most common installations utilize COM, JAVA, PEEL or Direct XML.

I am worried about customers abandoning the transaction because they do not know what is happening when the authentication window appears?
Managed Prepaid and Visa are recommending that merchants use an inline window approach and Managed Prepaid has a framed inline solution that allows merchants to maintain their branding and provide merchant messaging to inform the consumer that authentication is part of the checkout process.

Visa is also developing a campaign to educate consumers on VbV through the use of commercials and other avenues of advertising (such as Internet banner ads).

Why haven't I heard about this before?
Visa has been focusing the last two years on getting the issuing banks and their cardholders enrolled. Now that they have reached a critical mass, we are beginning to approach merchants, particularly merchants in high risk categories, like yourself.

I don't authorize until I am sure I am going to be able to ship the product. Would I be able to do authentication if I don't authorize real time?
You are still able to authenticate if you batch authorize at a later time. You would be required to make one minor modification in your authorization process. You would need to store the ECI (e-commerce indicator) and CAVV/AAV (Cardholder Authentication Verification Value/Account Authentication Value) with your other transaction values so that you could pass those through electronically at the time of authorization.

What if I have a split shipment, can I charge the account twice and still use the authentication?
Yes. As long as both parts of the split shipment originated from the same initial authentication request.

I have a recurring portion of my Internet sales; are these covered under the VbV and SecureCode rules?
The first payment in a recurring payment transaction is protected. Subsequent payments with the recurring payment indicator are not protected under the Visa or MasterCard rules at this time. The Visa E-Commerce Preferred Interchange also only applies to the first payment.

Can I accept transactions even if the billing and shipping address do not match?
Yes, accepting transactions that have different billing and shipping addresses is not prohibited. There is no increased merchant liability for these types of transactions. If ClearAuth® is installed on your merchant site, you will continue to receive fraud liability protection and guaranteed payment on those transactions covered by Verified by Visa and MasterCard SecureCode.

Can ClearAuth® be added to my existing Managed Prepaid eBusiness applications?
Yes. Contact a Managed Prepaid team member via email at sales@managedprepaid.com or call us directly at 504-324-2346. ClearAuth® is available now for installation on all Managed Prepaid eBusiness applications.
For more information or to schedule a call to discuss our ClearAuth chargeback blocking solution please email sales[a]managedprepaid.com.