Chargeback Period Reduction for Atms, POS and Web Transactions

TNP Insights Chargeback Period Reduction for ATMs, POS and Web Transactions S/N Electronic Reference Revised Timelines Former The Revised Guidelines Channels Timelines makes the following additional 1 ATM Section 1.6 Reversal of failed “on T6 +3 days provisions; Nta Oluwaseun us”4 ATM transactions- Ekpiken Adebisi Instant • All Switches to adjust the Partner Associate chargeback cycle in their E: [email protected] E: [email protected] Where instant reversal fails due to technical issues of dispute resolution policy system glitches- 24 hours from Seventy-Two hours (72) hours to Twenty-Four hargebacks generally mean Reversal of failed “not- (24) hours. the reversal of a payment on-us”5 ATM transactions or request for repayment - 48 hours • Acquirer initiated refunds C 2 POS Section. Resolution of disputed T + 5 days in a transaction previously shall be initiated by all banks 2.4.1.13 transactions between settled or remitted. This reversal the merchant and the within Forty-Eight (48) is usually done by the issuing cardholder by the hours. bank, payment scheme provider merchant acquirer, or other financial institution. in collaboration with • Processors must provide The reasons for a chargeback other payments system stakeholders – daily settlement reports may include non-authorization 48 hours on or before 8 a.m. on a of the transaction amount Investigation and T+1day basis. by the cardholder, an error in Section. resolution of errors on transaction details, duplicated 2.4.6.8 the cardholder ‘s card • Nigerian Inter Bank by the issuing bank transaction, non-receipt of upon notification by the Settlement System (NIBSS) goods and services purchased or cardholder - 48 hours to send daily reports on any number of other reasons. 3 Mobile- Section. Investigation and T +5 days reversals to processors on or POS 3.4.6.8 resolution of a transaction before 10 pm each day In 20161, the Central Bank error by the issuing of Nigeria’s (“CBN”) issued bank upon notification In light of the revisions Guidelines on the Operations of by the cardholder- 48 hours. (This is despite provided for in the revised Electronic Payments Channels the card scheme’s dispute Guidelines, it is recommended in Nigeria (“Guidelines”). resolution process) that all stakeholders update The Guidelines provided for Response their necessary service level chargeback period on failed Acquiring bank to time - 3 agreements and payments respond immediately to days transactions, and on 29th May the issuing bank’s request policies. 2020, the CBN revised it, on resolution of the informing all stakeholders by its transaction errors 1. Guidelines on Operations of Electronic Payment Circular No. PSM/DIR/ CON/ Channels in Nigeria April 2016” available at: https:// Resolution of disputed T + 5 days. www.cbn.gov.ng/Out/2016/BPSD/Approved%20 CWO/O7/127 that it had issued Guidelines%20on%20Operations%20of%20 2 Section. transactions between Electronic%20Payment%20Channels%20in%20 revised Guidelines to that effect 3.10.1 the merchant and Nigeria.pdf (the Revised Guidelines”). the cardholder, by 2. “Circular on “Reduction of Chargeback Period for ATMs, POS and WEB Transactions in the Guidelines for the acquiring bank in the Operation of Electronic Payment Channels” conjunction with the available at: https://www.cbn.gov.ng/Out/2020/ According to the Revised CCD/Circular%20on%20reduction%20of%20 3 issuing bank, switches chargeback%20period%20for%20ATM%20POS%20 Guidelines , reversal of “failed and other payment system and%20WEB%20transactions.pdf on-us” Automated Teller stakeholders - 48 hours Response 3. Guidelines on Operations of Electronic Payment Channels in Nigeria” June 2020 available at: https:// Machine (ATM) transactions time- 3 days www.cbn.gov.ng/Out/2020/CCD/Reviewed%20 and%20Approved%20Guidelines%20on%20 are now instant. This has been Acquiring bank to respond Operations%20of%20Electronic%20Payment%20 changed from the previous immediately to the Channels%20in%20Nigeria%202020.pdf issuing bank’s request on 4. Failed transactions when customers use their cards on timeline of three (3) days. In the resolution of disputed their bank’s ATMs. addition, refunds on failed transactions 5. Failed transactions when customers use their cards on Point of Sale (POS)/WEB other bank’s ATMs. 4 WEB Section. Issuing bank to Response 6. “T” means Transaction Date. transactions must be made 4.5.3.8 immediately acknowledge Time - 24 within forty-eight (48) hours as disputes or com-plaints hours against a previous five (5) day from cardholders timeline. These revisions became Resolution of disputes T + 3 days effective on 8th June 2020. and com-plaints from cardholders by the issuing We have provided a table below bank in conjunction with details of the key changes with the acquiring bank and platform provider to the chargeback period set by (payment service pro- the Revised Guidelines. viders) - 48 hours

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