Void vs. Refund Transaction

Many of our support tips are recycled from earlier postings, but I think we have added about a thousand new clients since we last published this support tip. It has to do with the difference between running a Void versus a Refund transaction. The longer, in-depth explanation is here, but this is the nitty gritty:

• When a merchant processes a credit card sale, an authorization is made in real-time, which is captured in their terminal, POS system, or payment gateway (for web-based sales).
• If the sale was for the wrong amount, or otherwise mistakenly made, a merchant can void that sale as long as the system has not yet settled the sale(s) to their merchant service provider for payment.
• If the mistaken sale is not noticed until after the settlement (which is normally set by the merchant near the end of the day), a refund is made so that the charge that appears on the cardholder’s statement will show as a credit to balance the original charge amount.
• A voided transaction does not debit a cardholder’s account; it is merely an authorization request that drops off after a few days.