Reversed charges, cancelled points

[zzyss]

I recently put through some orders charged to my credit card, only to later have to cancel them and have the charges reversed. Obviously the points were also revoked. I'm just curious to know this about the situation:

As a merchant, when you reverse a transaction, do you (a) still get charged the fee for the original transaction, and (b) get charged a fee for the reversal? Or is a cancelled transaction effectively "free"?

Is there any difference between this and a refund (assuming a sufficiently long delay between the original transaction and the refund - or is that why businesses only allow refunds for up to 14 days?)

Lots of questions

 

[Iza]

As a merchant, when you reverse a transaction, do you (a) still get charged the fee for the original transaction, and (b) get charged a fee for the reversal? Or is a cancelled transaction effectively "free"?

zzyss, a reversed / cancelled / refunded transaction is effectively "free" as you stated. Merchant fees are refunded, and AFAIK, there are no additional charges to the merchant for refunds.

 

[Mal]

I think for International transactions though, the consumer looses out as the forex fee is not refunded. If the refund is processed as a credit, then they lose out doubly as a forex fee also gets put onto the refund. There can also be exchange rate fluctuations that can benefit or disadvantage the consumer too if a credit is performed.

I havn't had too many reversed international charges though, so not 100% sure on my experience. Can anyone confirm? And do all cards handle this the same way?

 

[Travel Guru]

zzyss, a reversed / cancelled / refunded transaction is effectively "free" as you stated. Merchant fees are refunded, and AFAIK, there are no additional charges to the merchant for refunds.

Thats correct, the reversal of merchant fees balances out and it's free with no other charges applied.

TG

 

[zzyss]

I havn't had too many reversed international charges though, so not 100% sure on my experience. Can anyone confirm? And do all cards handle this the same way?

Not sure how it works, but here's my example:

22 Jul 2009 45.22 GBP INC FX FEE AUD$ 3.22
22 Jul 2009 THE BOOK DEPOSITORY LT GLOUCESTER GB (D) 95.54
27 Jul 2009 45.22 GBP INC FX FEE AUD$ 3.20
27 Jul 2009 THE BOOK DEPOSITORY LT GLOUCESTER GB (C) 94.71

D = Debit and C = Credit obviously. It seems to me like the FX fee was taken in both directions.

 

[MelUser]

I have had US stuff reversed on AMEX and I get hit twice with the conversion fee - ie I pay it on purchase and I pay it again on the refund!

 

[one9]

I recently put through some orders charged to my credit card, only to later have to cancel them and have the charges reversed. Obviously the points were also revoked. I'm just curious to know this about the situation:

As a merchant, when you reverse a transaction, do you (a) still get charged the fee for the original transaction, and (b) get charged a fee for the reversal? Or is a cancelled transaction effectively "free"?

Is there any difference between this and a refund (assuming a sufficiently long delay between the original transaction and the refund - or is that why businesses only allow refunds for up to 14 days?)

Lots of questions

I believe it depends on the merchant bank. For example it is my understanding that NAB reverses the merchant fee to merchants for refunds, whereas Bankwest does not.

 

[drron]

I have had US stuff reversed on AMEX and I get hit twice with the conversion fee - ie I pay it on purchase and I pay it again on the refund!

Another reason to go with Diners-assuming they can ever get over the stuff up in their IT systems.This next trip I had registered for a conference at the Mayo-everything to do with learning and no thought of screwing Wayne swan for everything i can:shock:.It was cancelled 3 weeks ago just before the dollar made its current move into the 80s.I actually came out $3.16 ahead on the refund .So must not have had to wear 2 lots of 4x fees and got reimbursed for the original.

 

[albatross710]

it and C = Credit obviously. It seems to me like the FX fee was taken in both directions.

I believe this shows that the FX fee was taken on the first transaction and returned on the latter.

As for banks, you do need to check the individual bank merchant terms. I know that one of my banks in the last few years didn't refund the merchant fee. We really do reversals so it didn't concern us.

As for difference between a 'return' and a 'refund' in the merchant system. The system doesn't differentiate, merchant fees returned on both. A customer could, in theory, pay the original purchase by Visa and then refund to Amex.

Recently we have gone to an virtual POS. In those cases when we do a reversal we have to specifically identify the transaction to be reversed.

 

[Mal]

Here's my recent (and nasty) forex conversion fee taken on both a credit/debit:

A hotel I stayed in accidentally charged me ~$A600 too much. They put through the first transaction, but didn't (or couldn't) cancel it. I paid ~$A22 commission on this transaction.

They then put through a credit for the $600, and I paid an additional fee of ~$A17.

So the real fee that should have been paid was around $A4.50 - not $A39

 

[Flashback]

Here's my recent (and nasty) forex conversion fee taken on both a credit/debit:

A hotel I stayed in accidentally charged me ~$A600 too much. They put through the first transaction, but didn't (or couldn't) cancel it. I paid ~$A22 commission on this transaction.

They then put through a credit for the $600, and I paid an additional fee of ~$A17.

So the real fee that should have been paid was around $A4.50 - not $A39

It's a long shot, but maybe mention this to the hotel and try to extract either a discount voucher out of them, or some points from their loyalty program