Should you void or refund that transaction?
Often a retailer will have to perform a return and refund a customers credit or debit card. This brings up the question as to which way is best to return the funds to the cardholder. Should you void or refund the transaction?
The general rule is that you want to void the transaction since voiding stops the transaction from fully processing. If you process a refund you will pay the full discount fees (percentage) since you are performing the whole transaction. It seems quite simple but there are limitations to how you can void a transaction.
How transactions are stored.
Whether using a credit card terminal, POS System or wireless device, your transactions for the current batch are stored in one of two places. Using Host Capture your transactions are stored at the processor itself and with Terminal Capture your transactions are stored on the terminal itself. Some systems settle batches automatically and others require the manager to settle the batch.
To perform a void the transaction must be in the current batch. If your batch has closed out you will have to resort to the more expensive action of refunding the merchant.
To find out more about which type of system you are on and how to perform a void contact your merchant account service provider.
