Credit Card Firms Fining Merchants
Mastercard, Visa, Dicover and American Express all require merchants to discard credit card information as soon as they receive an authorization for a charge. The company and authorization number are all that is required for a merchant to receive payment.
Last weekend ushered in a new era in the credit card industry, as Visa joined Mastercard in imposing penalties from $10,000 to $100,000 for failure to keep transactions secure. The credit providers are not assessing merchants directly, but invoking the penalties on the companies that process the transactions. It will be up to these middlemen to collect from the individual merchants.
At this point, the program is being aimed at large merchandisers who violate the terms of their credit cards agreements. Neither card company would comment as to who the biggest offenders were other than indicating that such vendors are responsible for more than six million deals a year. Visa noted that only twenty of 334 merchants were non-compliant. This pool of sellers represent almost half of all Visa’s transactions.
Mastercard would not detail how many merchants violated the card agreement. Chris Tom, chief risk officer would only say, “We are not levying fines for noncompliance. We are levying them for non-cooperation.”
In a related development, Visa has not met its own security deadlines. The company had set a goal of completion by January 1, 2006, but did gain auditor’s approval in September only nine months behind schedule.
Last weekend ushered in a new era in the credit card industry, as Visa joined Mastercard in imposing penalties from $10,000 to $100,000 for failure to keep transactions secure. The credit providers are not assessing merchants directly, but invoking the penalties on the companies that process the transactions. It will be up to these middlemen to collect from the individual merchants.
At this point, the program is being aimed at large merchandisers who violate the terms of their credit cards agreements. Neither card company would comment as to who the biggest offenders were other than indicating that such vendors are responsible for more than six million deals a year. Visa noted that only twenty of 334 merchants were non-compliant. This pool of sellers represent almost half of all Visa’s transactions.
Mastercard would not detail how many merchants violated the card agreement. Chris Tom, chief risk officer would only say, “We are not levying fines for noncompliance. We are levying them for non-cooperation.”
In a related development, Visa has not met its own security deadlines. The company had set a goal of completion by January 1, 2006, but did gain auditor’s approval in September only nine months behind schedule.
posted by skgroner | 8:15 AM
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