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Visa Account Updater & Stop Service

Visa Account Updater & Stop Service. Direct Response Forum Europe 25 April 2006. Introduction - Agenda. Regular Payments Initiatives Overview of VAU & Stop Service Merchant Feedback Stop service. Regular Payment Benefits. Merchants

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Visa Account Updater & Stop Service

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  1. Visa Account Updater & Stop Service Direct Response Forum Europe 25 April 2006

  2. Introduction - Agenda • Regular Payments Initiatives • Overview of VAU & Stop Service • Merchant Feedback • Stop service

  3. Regular Payment Benefits Merchants Easy mechanism to initiate remote payment and improved renewal rates Cardholders Easy to set up and convenient for remote environments - Internet Convenience Visa Increased transaction volume Members Cuts costs of cheques. Improved customer service.

  4. But there are problems • Existing card scheme solutions have evolved over 30 years and do not necessarily meet the requirements of all parties: • merchants often hold invalid card number information • this leads to high decline rates (circa 30%) and chargebacks (up to 20 x face-to-face) • difficult to stop Regular Payments – regulatory impact Cardholder and merchants are becoming reluctant to use card based Regular Payments

  5. Visa Europe’s response • Tactical Improvements • Rule changes to facilitate volume growth e.g. recurring transactions cannot be declined for invalid expiry date • Summer 2004 3 UK credit Issuers undertook a refresh of card numbers for 5 Regular Payment merchants. • Provided a statistically high level of either refreshed card numbers (18.5%) or confirmed to merchant that they were currently using the most recent card number • Demonstrated the value of developing an automated mechanism to refresh card numbers • Strategic Improvements • Build an automated service to refresh merchant card number databases and provide a mechanism to stop Regular Payments

  6. How does the VAU / Stop Service Work? Acquirer Acquirer submits enquiry on merchants behalf On-line stop instructions Issuer Customer Service Centre Submission of enquiry file (merchant determines Frequency) Merchant VAU / Stop Service Issuer Card Management System Batch card number updates (minimum monthly) • Merchant receives • Refreshed number or • Confirmation of existing number • Details of any stop transactions

  7. UK Operating Regulations • The following proposals were approved by the Visa UK Board • By April 2006 • All UK Issuers (Credit & Debit) for participation in VAU & Stop service • All UK Acquirers that acquire recurring transactions for participation in VAU Stop service • All UK Acquirers to register their RT merchants on the VAU Service

  8. Merchant Feedback - Visa Account Updater • Very positive feedback. Will help with decline and chargeback situation • Like getting a response on every card number. • Would be useful to get policy number back with the updated card number • This could solve the majority of problems

  9. Stop service • Insurance companies want to provide policy number. This is key to recognising customers. They would be happy to perform enquiries after the initial set –up. • Merchants see advantage of Stop facility as early warning of customer dissatisfaction. • Having the policy reference number is important as they will use it to double check that the customer wants to stop the policy/service

  10. The Stop Service Overview of the VAU Stop Service

  11. Œ Merchant and Account information from the Acquirer enquires is copied to the Merchant database. Ž Card Issuer • Acquirer  All the Merchants and Policies associated with the card from previous Acquirer traffic is returned. The Issuer inputs the card that they want to place the Stop on using the Stop Service on Visa Online. Stop Service This slide explains how the Issuer is able to stop a recurring payment on one of its account numbers. VAU MerchantDatabase

  12. Stop or Resume Recurring Payment Stop or Resume Policy Enter PAN Number: 4xxxx11230000001 Issuer Reports Back Continue Home

  13. Stop Advices for Card 4xxxx11230000001 Stop or Resume Policy Stop Card Issuer Reports Stop Stop Home Resume Resume Stop Resume Stop

  14. Stop All Recurring Payments on Card Stop or Resume Policy PAN Number 4xxxx11230000001 Start Date of Stop End Date for Stop (optional) Issuer Reports 25/05/2005 Home Confirm Cancel

  15. Stop Advices for Card 4xxx11230000001 Stop or Resume Policy Stop Card Issuer Reports Stop Stop Home Resume Resume Stop Resume Stop

  16. Stop All Recurring Payments for Merchant on Card Stop or Resume Policy PAN Number 4xxxx11230000001 Merchant AOL Start Date of Stop End Date for Stop (optional) Issuer Reports Home 25/05/2005 Confirm Cancel

  17. Stop Advices for Card 4xxxx11230000001 Stop or Resume Policy Stop Card Issuer Reports Stop Stop Home Resume Resume Stop Resume Stop

  18. Stop a Recurring Payment for a Merchant on Card Stop or Resume Policy PAN Number 4xxxx11230000001 Merchant AOL MPRN AOL01203 Start Date of Stop End Date for Stop (optional) Issuer Reports Home 25/05/2005 Confirm Cancel

  19. Summary • A large sector opportunity exists for Visa and its Members • Strategic solutions have been designed and are available to be rolled out on a market by market basis • Opportunity to implement VAU new operating regulations in any Visa Europe market. Initial Market is the UK, followed later this year by Ireland

  20. Thank you

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