Fascard Surcharge Taken From Add-Value Transaction Rather Than Being an Additional Charge

How it Happens

If the FasCard system already has an open pre-authorization for a given credit card when a user initiates an add-value request, then the FasCard server will use the pre-authorization to fund the add-value.  In cases like this, there may not be enough funds remaining on the existing pre-authorization, so FasCard had to open a 2nd pre-authorization to cover the request.

In addition, FasCard does not calculate surcharges on individual transactions but rather on the full spend amount, so if a pre-authorization is originally created for a machine start then we are going to apply a surcharge even if the pre-authorization is partially used for add-value and the account is configured only to apply surcharges to machine starts.

Here is an example sequence:

• User swipes their credit card on a machine, and we pre-authorized the customer for $15.00

• User then spends $7.00 to start the machine, and the resulting surcharge is $0.21

• User then tried to add $20.00 from their credit card to his loyalty account

• The server estimated $15.00 - $7.21 = $7.79 available remaining on the original pre-authorization, and therefore recognized that it needed to request another $12.21 to fund the $20 add-value request

• However, since the original pre-authorization was opened for a machine start and therefore was not exclusively for an add-value, the server treated the entire pre-authorization as requiring a surcharge

• As a result, of the original $15.00 in the pre-authorization, the user only had $15/1.03 = $14.56 of spending power (a 3% surcharge on $14.56 is $0.44, and the two add up to $15.00)

• So the server only applied $7.56 remaining from the original pre-authorization to fund the add-value request

• In addition, the 2nd pre-authorization was also flagged for surcharge, which means it only had $12.21/1.03 = $11.85 of spending power

• Consequently, the user had $7.56 + $11.85 = $19.41 added to their account

• So in total, the customer was charged the following:

  • $7.00 machine start

  • $7.56 + $11.85 = $19.41 add value

  • 3% surcharge on ($7.00 + $7.56) = $0.44

  • 3% surcharge on $11.85 = $0.36

  • Total = $27.21

Why it Happens

The reason that this looks different from most add-value transactions is simply that the retail customer made a direct purchase with their credit card prior to adding value to their loyalty card, and in this case the system applies a surcharge to the add-value transactions even though it’s not requested. This is a known oddity that fell out of the original effort to add support for surcharges, but at the time we figured it was such a rare event and would have been so painful to fix that we wouldn’t spend development time on it unless it became more of an issue (see the Description for FCSRV-37).

Basic Explanation

All the above is quite technical, though, so it may be easier to tell the store owner the following:

• In the event that a retail customer first purchases a machine start on their credit card, and subsequently tries to add value to their loyalty account from the same credit card, then a surcharge gets applied to all purchases.  Furthermore, when this happens the surcharge on the add-value is taken away from the add-value amount rather than applied in addition to the add-value amount.

• In this particular instance, the user was charged as follows:

  • $7.00 machine start + $0.21 surcharge

  • $20.00 add value, of which $19.41 went into the loyalty account and $0.59 was the surcharge

• If a retail customer is upset about the add-value surcharge then it's straightforward to simply make an admin adjustment of the difference missing to customer's loyalty accounts.

Related Jiras

SUP-20490

FCSRV-37