Credit card procedures - a lengthy read

[RogerS]

Just been through a couple of days of interesting times with credit cards and in the process learnt (more than I really need about their procedures). Thought I'd share it with the forum in case someone else gets in the same predicament. Fortunately all resolved equably but at the cost of a huge amount of time.

1) Bought an item on eBay and tried to pay on Saturday using PayPal. Screen flashes up 'your credit card authoriser has refused the transaction'. Very strange. Plenty of credit. So ring up the credit card company to be told that the first attempt failed but that the second attempt went through. Unfortunately no evidence exists on History in PayPal. PayPal say the transaction is lost in my credit card company. Credit card company implying that transaction is with PayPal. Feel like piggy in the middle.

Reality - neither were correct.

I always thought that credit card transactions were straightforward. In fact it's a four stage process but because of computers it appears to be a single transaction. If it goes belly-up in the middle (as happened in my case then you have a problem).

PayPal (or retailer) asks credit card company 'Can I have £1000 from this card'. CC then either authorises or declines. If authorised PayPal then asks CC 'OK - can I have the money then?' and CC responds 'Yes - here you are'. Transaction completed.

In my case, when PayPal asked for authorisation, the anti-fraud software at NatWest flagged the transaction up as possibly fraudulent as it was outside my 'normal' spending pattern (whatever that is and no I wasn't buying anything dodgy ) and refused the first authorisation attempt.
I'm not knocking NatWest as their software did what it was supposed to do.

NatWest tried to call me in realtime on my mobile to verify the transaction but could not get through. Their default position was then to authorise the amount on the second attempt. However, all that this does is reserve the necessary funds from my credit limit. No cash has gone yet as PayPal don't appear to be able to handle this scenario. However, because the funds have been reserved, I cannot make use of this amount of credit.

I could attempt to pay for the items again but my concern would be that PayPal's computer might 'wake-up' and go take the first lot as well.

After lengthy correspondence with PayPal (whose customer service reps need a kick up the backside to actually read the full email before responding to avoid them sending fatuous responses) it woild appear that (a) I cannot get the reservation lifted but (b) it will 'disappear' or time-out in a couple of days. Great but no cigar to PayPal for bad 'error recovery procedures'.

OK ..second one

Bought a kitchen at Magnet. Their computer system wasn't linking through properly for automated credit card payments and so we resorted to a manual approach. While at the shop I paid the initial deposit of £1000 and was totally unaware of an impending mega-problem.

During conversation with NatWest regarding (1) and over the course of a few days..I realise that I am talking to a different set of people from those in customer services and these people are actually looking at the transactions in real-time. (Apparently, the CS guys only get to see what's on your statement [and this can lag behind real-time events ...which I didn't realise]. The same goes for when you call up to get your latest transactions from an automated response system.)

In conversation, the NatWest guy mentioned that in addition to the PayPal reserved funds I also had funds reserved for Magnet to the tune of £3500!!
Somehow, when the guy at Magnet dialled up the manual authorisation process, he indavertently asked for authorisation for the whole amount and not the deposit! So, here I am about to on holiday, with my credit card limit at zero

I cannot release the funds...only Magnet..but they can only release the full amount and not the £1000 deposit...but this latter transaction has already gone through their system and cannot be rolled back either. So we are basically stuffed at this point. As I say, about to go on holiday with a duff credit card.

Throughout the entire process I have to say that the NatWest people were exceptionally helpful.

Fortunately, some four hours on, while talking to customer service (who have a different system and we are all scratching our heads as to how to fix things) the £1000 payment comes through onto their system and this event has the effect of wiping out the remaining reserved funds set aside by Magnet. So I'm now very happy and the local Magnet store manager can breathe a sigh of relief.

 

[Philly]

Wow Rog! :?
Makes your head spin, doesn't it? (dreams of the "old days" where cash was king)
Cheers
Philly

 

[johnelliott]

Bought a kitchen at Magnet.

:shock: :shock: :shock:
The done thing around here is to make your own!!!


Another interesting aspect to all this- my understanding (which in this case is quite good as I am actually a credit card retailer, although I no longer normally accept payment by CC due to the possibility of 'chargebacks') is that anything bought by CC must be paid for in one go, in other words, one transaction, one payment. Paying piecemeal by CC is a big no no, although I am well aware that lots and lots of people do it.

John

 

[chiba]

Yup, that's exactly right. I wrote the bulk CC payment system for an online retailer (that I'd best not name). Basically ask for a hold, get an OK, then when you ship the product you ask for payment. If you don't ship you ask for a cancel. The hold only lasts for a finite period, depends on the country. All good fun, all very primitive behind the scenes! Lots of passing around of 'ickle text files with checksums on checksums on checksums...

 

[woodshavings]

I had a simular problem to Roger when a retailer inadvertantly reserved funds twice the amount requested because of problems with the system connection. I decided to pay by debit card which was done through a different system.

I discovered the reserved funds issue when my credit card was refused for another transaction! Furious, I contacted the card company who gave the same story, saying unless the retailer contacted them, I would have to wait until the reserved fund hold expired.

After much discusion, the cc company increased my credit limit for 1 month so I could use the card until the cancellation came through.

What a game of cowboys!!

 

[RogerS]

I just dialled in to see if the PayPal hold had disappeared. My last transaction according to the IVR was £120.98. I then spoke to a customer rep and during the conversation this amount had changed to 121.93!! This was to Craftsman Gallery in the USA and so it would appear that their statement system is 'realtime' as far as currency fluctuations is concerned. Bizarre.

Edit: very strange. Two different computer systems in play here. If I enquire my recent transactions using their IVR system I get the lower figure. If I speak to a rep. then I get the higher figure.

 

[RogerS]

Going round and round in circles here. It would appear that their CS agents do not have the brain capacity to actually read the complete thread before passing around the shared brain cell and replying.

Instead they respond to the last email in the thread and come up with yet another fatuous response.

I would apply for a chargeback but they haven't taken the funds...just stopped me from using them.