The card networks (Visa, Mastercard, Amex, Discover, etc.) introduce and make changes to their rules and mandates throughout the year. Many of these changes come twice per year—spring and fall.
The network updates typically include fee introductions or fee changes, new mandates, new features, or updates to existing features. The changes can be broad in nature, and may include updates such as mandates to comply with new regulations; implementing new fees; or requiring merchants to use schemes like 3DS 2.0 to help reduce fraud.
While many of the updates require no action for merchants, some do require integration changes or force adoption of services. Additionally, some of the updates carry new or changed fees.
Braintree teams have worked to identify the key updates for Spring 2023, and we have provided information about these updates below. We have called out the type of update (fee change, mandate, new feature/update), which network the update comes from, and the relevant market(s).
— The Information Contained In This Document Is Accurate As Of March 31st, 2023 And Is Provided For Informational Purposes, Is Subject To Change, And May Not Apply To All Merchants Or Transactions. —
KEY SPRING 2023 NETWORK RELEASES AT A GLANCE (click below to jump to specific update)
|Estimated and Incremental Authorizations||Fee Change||Visa||Global|
|Card Verification Value 2 (CVV2) pricing change||Fee Change||Visa||US & Europe|
|Non-Domestic Currency Settlement||Fee Change||Visa||Global|
|Account Verification Fee Update||Fee Change||Mastercard||Canada|
|Digital Enablement Fee Update||Fee Change||Mastercard||Canada|
|New Interchange Program for APAC||Fee Change||Mastercard||APAC|
|Secure Credential Framework Expanded in Europe||Fee Change||Visa||Europe|
|Standardization of Transaction Data Elements||Mandate||Mastercard||Global|
|Visa Marketplace Reporting||Mandate||Visa||Global|
|Revised Standards for Europe Region Final||Mandate||Mastercard||Europe|
|Authorization Clearing Submission Acceleration||Mandate||Mastercard||Europe|
|Icelandic Krona changes||New Feature/ Update||All||Global|
|Address Verification Service Update||New Feature/ Update||Visa||Global|
|Account Verification Messages Update||New Feature/ Update + Fee Change||Visa||Global|
NEW FEATURE/ UPDATE | ALL | GLOBAL
Visa and Mastercard will be removing the minor units for the Iceland Krona (from 2 minor units today—that is, a currency with two numbers after a decimal point to 0 minor units).
|Currency Name||ISO Code||Current ISO minor units||NEW ISO minor units|
FEE CHANGE | Mastercard | CANADA
Mastercard will introduce the Mastercard Digital Enablement Fee to support enhancements to fraud, safety, and security in the payments ecosystem on March 13, 2023. As part of the introduction of the new fee, Mastercard will retire certain existing Card Not Present fees.
The fee will be applied at 0.02% on all card not present authorizations with a minimum billing of $0.02 USD and a maximum of $0.20 USD per transaction.
|Fee Descriptor||Rate (USD)|
|MC-AUTH DIGITAL ENABLEMENT FEE||0.02%|
|MC-AUTH DIGITAL ENABLEMENT MIN||$0.02 MIN|
|MC-AUTH DIGITAL ENABLEMENT MAX||$0.20 MAX|
FEE CHANGE | Mastercard | APAC
Mastercard is introducing a lower interchange rate for commercial large ticket cross-border transactions that may reduce the overall cost associated with accepting the transaction.
|IC Program Type||Interchange Rate Descriptor (IRD)||Rate|
|Large Ticket Cross Border||B9||0.325% + USD $0.00|
To qualify for the program, merchants must meet all the following qualifying criteria. All transactions must be:
- Greater than $10,000 USD
- Card Not Present (CNP)
- Invoiced in USD and settlement with Mastercard must also be in USD. However, a Bank Identification Number (BIN) can be in any currency.
- Non-travel and entertainment (T&E) spend categories only.
- Cross-border and intraregional Asia/Pacific region
- Issuer country not Korea
- Restricted to B2B acceptance enablers who have registered in Mastercard's Business Payment Aggregator Program (BPAP).
- A BPA is a Merchant of Record and an entity accepting the card transactions on-behalf of an end Supplier.
MANDATE| Mastercard | GLOBAL
In April and June 2023, Mastercard will be introducing new service location data fields for clearing messages (April 2023) and authorization messages (June 2023). These new fields help add details around where the transaction took place and will provide customer service information to cardholders.
This mandate will require merchants that move to provide more detailed information about their actual transaction location. The current expectation is that merchants do not need to be ready for this mandate just yet and as such is provided as information regarding a future update.
Reference the tables in the appendix for information about the new fields.
What are the Revised Standards for Europe Region Final Authorization Clearing Submission Acceleration?
MANDATE| Mastercard | EUROPE
Beginning May 22, 2023, Mastercard is requiring that merchant processing in Europe must submit the clearing record for each transaction authorized as a final authorization within three calendar days of the authorization approval date. This is an adjustment down from the current seven calendar days timeline currently in effect. This mandate does not apply to estimated/ incremental authorization transactions.
FEE CHANGE | VISA | CANADA
Effective April 1, 2023, Visa will introduce and implement a new fee for account verification messages to establish consistent pricing globally. Account verification provides additional data points to help protect against fraud associated with invalid or misused credentials. The new fee will be $0.01 USD Per Domestic Account Verification and $0.02 USD Per Foreign Account Verification.
|Fee Descriptor||Rate (USD)|
|VISA ZERO AMOUNT FEE||$0.01|
|VISA ZERO AMOUNT FEE DB||$0.01|
|VISA ZERO AMOUNT FEE INTL||$0.02|
FEE CHANGE | VISA | GLOBAL
From April 17th, 2023, Visa will expand the eligibility of estimated and incremental authorization to all MCCs and will begin charging for all approved estimated and incremental authorizations:
|Fee Descriptor||Fee Amount|
|VI ESTIMATED AUTH FEE||0.02%|
|VI INCREMENTAL AUTH FEE||0.02%|
Estimated authorizations occur when an authorized amount may be different from a settled amount. Incremental authorizations occur when the final amount of a transaction is unknown, and an additional authorization occurs following an estimated authorization to adjust the original authorization amount.
Other than the new fee, there are no changes to the existing fields, processing rules for estimated and incremental authorizations, or interchange fee programs. Certain transactions are excluded, including account funding transactions (AFT), installment transactions, advance payment transactions, manual cash disbursement transactions, ATM cash disbursement transactions, Quasi-cash transactions, cryptocurrency transactions, and recurring transactions.
FEE CHANGE | VISA | U.S. AND EUROPE
Starting April 1, 2023, Visa will be introducing a new authorization fee for Card Verification Value 2 (CVV2). CVV2 is the three-digit security code primarily used in card-not-present transactions as an additional method to validate the cardholder and the card's presence during a transaction.
Visa will charge $0.0025 per CVV2 result when an M (match) or N (no match) result is provided. The fee will not be incurred when the CVV2 is unverified, a result is not returned to an acquirer due to error, 3DS is successful, or the authorization is a zero-amount account verification message.
|Fee Descriptor||Fee Amount|
|CVV2 (match / no match result)||$0.0025 per CVV2 result|
FEE CHANGE | VISA | EMEA
Beginning in April 2023, the existing Visa Non-Domestic Currency Settlement Volume Fee in Europe will increase from 0.02% to 0.05%. This fee applies to transactions that are not domestic where the currency used is not the domestic currency of the country in which the transaction has taken place.
|Fee Descriptor||Phase 1: April 2022||Phase 2: April 2023||Phase 3: April 2024|
|Non-domestic Currency Settlement Volume Fee||0.02%||0.05%||0.10%|
FEE CHANGE | VISA | EUROPE
Effective October 1, 2023, Visa will introduce a new fee for domestic and intraregional ecommerce primary account number (PAN)-approved authorizations processed without Visa EMV Payment Tokens or Visa Secure.
|Fee||In Scope||Out of Scope||Rate||Effective Date|
|Acquirer Secure Credential CNP Behavioral Fee||All domestic or intraregional CNP PAN authorization approvals processed without Visa EMV Payment Tokens or Visa Secure||All domestic or intraregional CNP authorization approvals that are processed:
||2.5 bps per trans-action||October 1, 2023|
MANDATE | VISA | GLOBAL
From April 15, 2023, Visa will require that all merchant participants in the Visa Marketplace Program include additional indicators for transactions that are generated by retailers in a different country than the marketplace and card-issuing country. Specifically, all clearing records associated with domestic marketplace transactions completed with a foreign marketplace retailer must include:
- Marketplace Location
- Marketplace Name
- Merchant Category Code
- Foreign Retailer Indicator (new field)
- Business Identification Number (new field)
If not complete, Visa will assess a new, incremental, manual reporting per-transaction fee of 0.10% for foreign retail volume reported without the indicators in place.
NEW FEATURE/ UPDATE | VISA | GLOBAL
Visa will simplify and streamline Address Verification Service (AVS) processing by discontinuing redundant result codes. By eliminating certain codes, Visa will be able to clearly identify if AVS was performed. The codes bolded will no longer be returned and there is no impact to AVS fee.
Values and current descriptions highlighted in RED. in the table below are changing:
|Current Value||Current Description||New Value||New Description|
|A||Address matches, ZIP does not. Acquirer rights not implied||A||AVS street address only (partial match)|
|B||Street addresses match. Postal code not verified due to incompatible formats||A||AVS street address only (partial match)|
|N||No match||N||AVS non-match|
|C||Street address and postal code not verified due to incompatible formats||R||AVS indeterminate outcome (retry)|
|G||Address information not verified for international transaction||R||AVS indeterminate outcome (retry)|
|I||Address information not verified||R||AVS indeterminate outcome (retry)|
|R||Retry: System unavailable or timed out||R||AVS indeterminate outcome (retry)|
|S||Not applicable||U||AVS unable to verify|
|Text||Address not verified for domestic transaction||U||AVS unable to verify|
|D||Street addresses and postal codes match||Y||AVS full match|
|F||Street address and postal code match. Applies to U.K.-issued cards.||Y||AVS full match|
|CM||Street address and postal code match||Y||AVS full match|
|X||Not applicable||Y||AVS full match|
|Y||Street address and postal code match||Y||AVS full match|
|P||Postal code match||Z||AVS full match|
|W||Not applicable||Z||AVS postal/zip code only (partial match)|
|Z||Postal/ZIP matches; street address does not match, or street address not included in request||Z||AVS postal/zip code only (partial match)|
NEW FEATURE/ UPDATE & FEE CHANGE | VISA | GLOBAL
Visa introduced Account Name Inquiry functionality to allow account name inquiries in account verification requests in April 2022. Visa is now enhancing the account name inquiry functionality to allow matching to also be performed on the first, middle, and last names separately, as well as a full name match result based on the combination of first, middle, and last name. To support this change Visa will introduce:
- Last Name Account Match Decision
- Middle Name Account Match Decision
- First Name Account Match Decision
In addition, Visa will rename Account Name Match Decision to Full Name Account Match Decision.
Effective April 2023, if you opt to use this service, a $0.05 fee will apply to each usable result. Systemic billing for this fee will be available starting in June 2023. Effective April 2024, this fee will increase to $0.10. Using this service in conjunction with the $0.00 auth could provide benefits in the form of reduced fraud.
|Fee Descriptor||Fee Amount|
|VI ACCOUNT NAME INQUIRY FEE||$0.05|