Point of Sale software news, updates, and insights

Declined Gift Cards: What to Do

Jul 31, 2020

Declined Gift Card

One of the most common issues affecting customers is rejected cards. While credit and debit cards are attributed to bank errors, many businesses don’t realize why gift cards are rejected. Here’s a brief explanation of declined gift cards and what to do for your business and customers.

Preauthorization Charges

Preauthorization charges are meant to protect the business from fraudulent customers. They’re designed to protect against fake or stolen cards, cover insufficient funds, increase workflow, and organizes tabs and customer information. More so, it can hold the value of products or services rendered through the gift card’s charge. If there are not enough funds on the card, it will reject the transaction.

Card Issuer Requirements

Declined gift cards at your business might be a problem because of card issuer requirements. Some universal gift cards act like credit cards in that they possess PIN, zip code, or CVV requirements for the vendor to input. This could cause issues if the gift card is used for general purchases where the information isn’t known. Still, having these requirements decreases the chance of fraud or stolen cards. If customers cannot provide this information, their gift card is subsequently rejected.

Delayed Funds

When a product or service paid for using gift cards is returned, there is a timing delay for those funds to be appropriately returned. This can take days, weeks, or longer until the full amount returns to the card. Typically, this is no longer than when the transactions are settled or credit was issued. Sometimes, though, there are delays in which funds have not been returned promptly, resulting in a rejected gift card at the time of the next purchase.

Fortunately, our legacy BPAPOS restaurant, retail, and hotel systems have faultless gift card processing software for your business. With this functionality, you’ll see how gift cards can increase marketing, are inexpensive, and improve your revenue. Not to mention, having seamless gift card processing ensures greater customer satisfaction and retention. Call us for more information about our POS systems for your business.

 

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