As the popularity of debit and prepaid cards grows, so does a unique way to pay. Called partial approval, the practice allows consumers to complete transactions with more than one type of payment — for example, with multiple prepaid cards; a combination of a prepaid card and a debit card; a combination of a debit card and a credit card; or a combination of cards and cash.
Partial approvals are especially useful when a consumer purchase exceeds the funds available on a prepaid or debit card. Merchants or businesses can obtain authorization for the amount on the card, and then initiate split-tender processing with another card (or cash) to obtain the remaining purchase amount.
MasterCard is a major proponent of the practice, and recently enacted rules requiring all businesses and processors to support partial approvals for MasterCard debit and prepaid cards.
How it Works
Partial approvals require an extra step in the authorization process, similar to those involved in EBT and private-label, prepaid card transactions.
Cards are accepted and transactions initiated in the usual manner, typically by swiping. If the authorization response shows an approval amount less than the requested amount, the business simply asks the cardholder for another form of payment to cover the difference. The second form of payment is accepted, and the transaction completed.
If the cardholder does not want to proceed, or the business cannot complete the transaction for any reason (e.g., item out of stock) a real-time reversal transaction is initiated to immediately free up the card.
For some MasterCard prepaid cards, completed transactions will include a message with the remaining prepaid card balance in the authorization response message. If this amount is included, the business must print the amount on the customer receipt, or display it on a customer-facing terminal.
How to Handle
For the most part, businesses and merchants accepting MasterCard need only make a few changes to meet partial approval rules and regulations.
- Merchants maintaining their own Point-of-sale software (e.g., with in-house staff or third-party vendors), must add partial approval functionality, including support of split-tender transactions, real-time reversals and the printing or display of customer account balances.
- Cashiers and other staff must learn how to handle partial approval and split-tender transactions, real-time authorization reversals, and become familiar with the printing or display of customer account balances.
TSYS Merchant Solutions is fully compliant with the partial approval MasterCard regulations, and has technology in place to complete all acquiring and authorization processing. Learn more about our credit card processing solutions.