Online Payment with Moneris

I am building a website for a client using PHP and accepting online payments by hooking into the Moneris API. My client keeps asking me this:

"If a payment is accepted, we ship the products and the credit card is then found out to be fraudulent, are we reimbursed by Mon开发者_开发问答eris?"

I know this is not really a development question, but I do not know and I do not want to tell them to just figure it out themselves. I cannot seem to find an answer anywhere.

Basically my question is, do these large online payment processing providers (like Moneris) have insurance to reimburse the merchant on products delivered before the payment is found to be fraudulent?

Depends on how the card details were captured.

If it was over the internet and 3dsecure authentication was used (Verified by Visa / MasterCard SecureCode) then the merchant is not liable for chargebacks (which is the correct term for what you're talking about)

Anything other than that, and yes - the merchant would cover the cost of the chargeback, and if an excessive number of chargebacks occur then its likely the acquirer would close down the merchant account.

The merchant is always liable for any fraud that occurs on their Moneris merchant account. However there is one exception: if the transaction was fully authenticated with Verified by Visa(VBV) or MasterCard Securecode(MCSC) then there is a liability shift and you're protected from chargebacks (with some exceptions).

If your concerned about the risk of fraud then you can further mitigate your risk by implementing some of Moneris's additional anti-fraud features (the brand name for these features is eFraud):

Address Verification Service (AVS) Checks the address that was entered against the address that the customers card issuing bank has on file

Card Verification Digit (CVD) 3-4 digit code located on all current credit cards for additional verification that the cardholder is in possession of their credit card. CVD code can be found on the back of the credit card (for Visa and MasterCard) and in case of American Express cards, it is located on the front.

Transactional Risk Management Tool

Real-time transaction risk analysis based on:

• Device fingerprint which uses non-personally identifiable information to identify the PC/device being used to send the transaction
• IP address information from which the transaction is originating
• Credit card information (eg. Country of Issuer)

Risk analysis rules that can identify fraudulent scenarios such as:

• Velocity checking (e.g. repeat purchases from the same device, card, email or IP address)
• Geolocation examination to identify suspicious use from locations that do not match card issued/shipping address
• Transaction risk score based on customer, enterprise and global transaction patterns to help you decide whether to accept, reject or further investigate transactions within seconds.

Fraud impacts merchants differently and since implementing anti-fraud features can make it harder for customers to complete a sale, you always want to balance the risk of fraud against the risk of lost sales. All the above features are optional so its up to you to decide which features are necessary for your business.

I've no idea about Moneris, but in general, credit card processors do not return funds to merchants in cases of fraud. The merchant is expected to either eat the costs, or get their own insurance policy.