Revenue Optimization 1: Authorization rates, fraud and some things you should know about risk management
The fees follow R1 (Revocation of Authorization Order) or R3 (Revocation of All Authorizations Order) decline codes.
R1 and R3 response codes are part of the Visa Europe Stop Service, which is used to block transactions where the cardholder has withdrawn consent for the payment. The new fees are introduced to limit costs for Issuers and prevent transactions being processed without cardholder consent.
Applicable from October 1, 2016, merchants are liable to a EUR 1.00 decline fee for the fourth and each subsequent authorization request following either an R1 or R3 decline code. Adyen will pass the fees on to you starting on October 1st 2016. Note that this new fee is only applicable to merchant-initiated authorization attempts as R1/R3 decline codes are also possible for cardholder present ecommerce transactions.
If you have a recurring model, please review your retry strategy to take into account the new fees to ensure that you don’t perform excessive retries on decline codes R1 and R3. Adyen will not actively reject non-compliant requests; it is your responsibility to ensure that you comply with this new rule.
Please contact your Account Manager or Adyen Support (support[at]adyen.com) in case you have additional questions.
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