cashless vending
SCA exemptions and is the vending industry being singled out? PSD2 provides a number of exemptions to SCA in order to minimise friction in customer payment journeys, and one of these is the Merchant Category Code (MCC) exemption. Unattended transactions from parking, road and bridge tolls and passenger transportation ticketing are exempt from SCA. In the UK, contactless charity donations from charities are also exempt from SCA. The other relevant provision is the low value exemption. Card
transactions below €50 are considered low value and are generally exempt from SCA. However, if the customer initiates more than five consecutive low value payments or if the total payments value exceeds €100, SCA will be required. The important thing to remember is that for the low value transactions
we typically see in vending, SCA is no different to the limits which are already in force for normal contactless transactions. The majority of vending customers will simply try another card if their first is declined. Another aspect to keep in mind is a transaction powered by a Google Pay or Apple Pay always authenticates the user so will not soft-decline. Ultimately, vending machine operators and payment system integrators don’t necessarily need to retrofit payment devices with PIN pads. If you do
start to see increased numbers of soft declines from June this year when SCA will ramp up, here are a couple of suggestions:
● Provide signage or instructions to cardholders to try another card in the event that their first is declined.
● Encourage the use of Apple Pay and Google Pay since these payment methods do authenticate the payer through a secondary – usually biometric – means.
AdditionAl informAtion if required, And of interest.
Timetable for SCA introduction. The original enforcement deadline for SCA was Sept. 14, 2019. The Financial Conduct Authority (FCA) in the UK agreed to delay the enforcement of SCA until Sept. 14, 2021. However, to avoid a cliff-edge implementation by enforcement date, SCA will be introduced gradually (SCA Ramp Up) in the UK from June 1, 2021. You should be aware that card issuers will begin to randomly challenge non-exempt transactions under the SCA requirements from June 1, 2021, and non-compliant transactions will be soft-declined.
Where SCA applies Merchants in the UK and Europe SCA is applicable to transactions in the EEA and the UK only, where both
payer and payee are in the region. When either the acquirer or issuer are based outside the EEA, this is referred to as a ‘One Leg Out’ (OLO) transaction and this is out of scope of SCA.
What does it mean for card present transactions? For card present, SCA is going to bring in “soft declines”. This is where the issuer of the cardholder’s card sends back the instruction to prompt for PIN entry in the authorisation result. So, you could tap your card, see it go online, and then have the device ask you to insert your card and enter your PIN. Only unattended terminals for passenger transport fares, road tolls and parking fees will remain exempt. In the UK, contactless charitable donations also benefit from an exemption from SCA. Devices without PIN pads that are already deployed in non-exempt usage will start to see higher levels of declines, because they aren’t able to handle the request to prompt for strong cardholder authentication. From a cardholder’s perspective, the only option in this situation is to try another card.
Cashless vending in brief
Nayax has announced its support of the CCI communication protocol, version 3.5 for the OCS industry. This is now available for use with VPOS Touch and Onyx cashless readers on coffee machines. It’s good news for vending operators, because you can take advantage of this new capability to make cashless payments possible – without having to add on the cost of an expensive MDB converter. All the leading credit cards and digital payment apps, as well
as the most popular regional banking apps in individual countries, are compatible with the system. Nayax also supports payment with prepaid or employee cards.
Evoca has added secure and convenient contactless drink selection to coffee machines. CoffeeAPPeal will interest those wishing to order their drink without touching the
screen. They simply make their selection by using an app on a smartphone. Using a Bluetooth connection, it’s a user-friendly and intuitive process that works at a short distance from the machine, thus removing any necessity to be within touching distance of it. CoffeeAPPeal is now installed on all Kalea Plus and Krea
Touch machines. It can also be installed on machines already in use simply by updating the machine’s software.
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