Credit card processors at it again...

[alohaakamai3]

This is a technical question and a heads up.

I recently had a customer call me with a charge back that initiated by the bank, not a customer.

A friend of the establishment came in a left a fairly large tip on their credit card(several times the amount of the bill). That the bank questioned it was not a huge deal, but their response was troubling.

They essentially said that any tip amount over 20% had to have an actually authorization to be considered valid. As most of you Aloha guys know, Aloha (and a few other systems I've worked with) does not dial out for actual authorizations for tip adjustments. The bank refused the tip, even though the restaurant had a signed copy from the customer (who was not disputing it).

I know when I go out, routinely tip over 20% for good service (25 or 30% in some cases). And higher percentage tips seem a lot more common place when someone has a smaller bill, like 2 beers for $8, and they pay with a card and tip $3 or $4. Even that would be refused by the bank according to what they are saying.

I know Aloha has the capability to assume a percentage amount over the bill for gratuity, but banks and PCI compliance have cracked down on this. Additionally, online banking has resulting in customers thinking they were charged more than should when they see the authorization for that extra percentage (if they leave a cash tip, no tip, or less than that percentage amount). Needless to say, I'd rather not go there.

Is anyone aware of a setting that will force Aloha to authorize the tips as well? Or can you think of any kind of work around that's not a total hassle (like preauth is)?

I don't know how wide spread this "policy" is, but it's kind of a big deal-when you are telling a merchant any tip on a credit card over cannot go over 20% and they will forfeit anything above and beyond that amount. I could see if it were set at say 40%, but it's not uncommon to see tips over 20%.

 

[alliancecomputers]

First, it sounds like a good time to shop for a better processor. Although it is possible that one day all processors will enforce this kind of rule, it has not happened yet.

Re-running the card risks offending a previously very happy customer, not to mention the risk of breaking prickly CISP laws.

These credit card processors get to sit and watch their file servers skim 3% off the top of everyones take. Then change their policies and rates in the name of customer protection. The only way to fight it is take away their easy money, and give it to another processor that is hopefully not quite as evil.

 

[alohaakamai3]

I feel the same way, the banks are huge crooks, and I could rant on for pages about this PCI compliance stuff that they have literally stumbled their way through, with all the grace and common sense of a drunken pirate.

My first though was new processor as well. It's a multistore chain which is good in the sense that they have some negotiating power, but also a pain in the sense that it's more hassle to do.

I don't think there is a way to do it either (not in Aloha, anyway), but I figured I would ask first before making a drastic recommendation.