Andy Orrock | Payment Systems

Tracking Partial Authorizations

I mentioned recently that when we installed support for Flexible Spending Accounts (‘FSA’) we got Partial Auth and Credit Reversals as part of the bargain.  Though we had some level of support in OLS.Switch for partial auth as part of our Stored Value Systems (‘SVS’) gift card interface, we weren’t leaving any way to monitor partial auth usage patterns.  SVS’s Approval Code for Partial Auth and Full Auth are the same (‘01’ curiously enough!) and we were overlaying the requested amount in our tranlog with the approved amount (which comes back in Field 4 of the ISO8583 response in most standard implementations).  That’s the minimal, sufficient practice for settlement.

As part of the FSA project, we added an “originalAmount” column.  I was curious to see some tracking numbers that would reveal the prevalence of partial auth instances.  The numbers surprised me – I suspected that as many as 20% of all transactions might be partial auths.  The numbers for the first three full days are eye-opening:  on Friday and Saturday, 33%; on Sunday, 40%!  Sunday looks like a cash-out day for people.  I’ll keep my eye on that and see what it looks like next Sunday and whether we get a repeatable pattern.   

These are retailer-branded gift cards.  One would have to assume similar consumer behavior for MasterCard-, Visa-, American Express- and Discover-branded pre-paid cards (and their various sub-categories – gift, promotion, FSA, etc.).  The Conclusion: if you’re not doing partial auth support for pre-paid cards issued under those various brands, it appears you’re denying one-third or more of the purchase requests.

Magnetic Stripe Basics

Luis Padilla Visdómine is just your average Molecular/Nuclear Physicist doing a little "extra work" about Magnetic Stripes (mostly as they relate to credit and debit cards).  This piece he's written contains a good breakdown of Tracks 1 through 3 basics.  Luis also references an outstanding piece by a Count Zero which - despite its now 14-year age - is still incredibly relevant and a must-read for anyone wishing to understand the basics of magnetic stripes and their governing standards.  As noted elsewhere, "[Count Zero's piece] is the de facto guide for hackers and hobbyists alike. While not actually containing any schematics on how to build your own reader, or interfacing existing reader to a PC, Count Zero covers all aspects of magstripe technology in a fun, easy to understand manner."