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PaymentNepal

Transaction Procedure

Transaction Procedure

Transaction Process Flow

  • Customers visit any e-commerce site of a merchant that is enrolled with Payment Nepal. The customer decides to pay for a purchase on the website and presses the pay button.
  • Payment Nepal page will pop up and ask Customers to enter the card details for the payment request. While entering card details following should be compulsorily entered:

a) Select Card Association
b) Card Number
c) Expiry Date
d) Card Holder Name
e) CVV Number

  • For PCI-DSS Certified merchants, card details can be saved for future transactions by the merchant. In this case, only OTP is verified from the customer end.
  • After that OTP is sent to the phone number/ email registered for each transaction. Then customer uses such OTP as required by the e-commerce site. After confirmation of OTP in the e-commerce site, the transaction is completed from part of the customer.
  • The transaction details are sent to the Card issuing Bank for authorization of transactions through NIC ASIA.
  • The transaction authorization response is sent from the card issuing Bank to the Payment Gateway System.
  • Payment Gateway System provides the authorization response in real-time back to the Merchant and Consumer. After the Transaction is successfully authorized, the Merchant shall release the product or service to the customer.
  • If the transaction is approved, the transaction information is transmitted through the Payment Gateway System, acquiring Bank, issuing Bank, and back to Payment Nepal Payment Gateway.
  • Payment Gateway System provides reporting of the daily transaction. Finally, the fund will be transferred to the concerned Merchant through our Settlement Bank NIC ASIA in t+1 days.

Transaction Settlement With Merchants

  • Separate panel will be provided to Merchant from where they can view their everyday transaction.
  • The authorization report for all the transactions shall be provided in the TC33A file to the Payment Gateway.
  • All the transactions under the capture file of TC33A shall be settled via file processing server with each card association
  • The report shall be prepared for each merchant settlement report as per the merchant ID and Terminal ID provided.
  • On the next BOD (Beginning of Day) of the working day, we get the file from the system server, where we reconcile the file and tally whether the amount is correct or not.
  • Then the settlement Bank shall make payments to the concerned merchants.
  • Payment settlement shall be done via NCHL/ some similar interface at the account maintained at Participant’s Bank name: ……………, Branch name: ……………… by the Account name………………. Account Number: ……………… and for this, if the settlement bank is other than NIC Asia, the minimum clearance charges will be levied as per NCHL/Interface rules.
  • In addition, the payment gateway shall send every particular merchant, credit advice of the amount which has been credited to the mentioned merchant through the system or whichever is viable.

Accounting of Fees

  • Merchant membership fees: Merchant Membership fees shall be charged to those newly enrolled members upon being the registered merchant.
  • Merchant renewal fee: Merchant renewal fees shall be charged to those existing merchant members on yearly basis for acquiring business from the Payment Gateway.
  • Merchant Service Fee/ Commission: Merchant Service Fees (MSF) generally are the fees that are charged by the acquiring banks, Payment Nepal for collecting fees from On-us and Off-us cards.

Accounting Entries

Merchant has to open a settlement account in order to credit the fund upon settlement of transactions. A merchant account will be used as a primary account for necessary credit and debit, any chargeback or reversal arising out of the transaction which has already been credited in course of the settlement will be debited from the Merchant Account. A merchant account will also be debited in the event of annual fees, charges, fines, penalties, or other assessments as a consequence of sales activities as per the agreement.

Settlement of Transactions

The Settlement Bank will process transactions of such Settlement on the basis of the report generated from the Payment Gateway System and make payment to the Merchant through the mode of Direct Account Credit after deducting the commission as mentioned in Merchant Establishment Application Form. The Merchant account shall be credited on the next working day of the batch settlement by the Merchant.

Dispute and Chargeback

A chargeback is a transaction that is returned, unpaid to the acquiring bank by the issuing bank because of a problem. This may be a dispute, a mistake, or an improper transaction. Disputes arising from Payment Gateway transactions shall be handled by the designated staff who shall ask the cardholder to request via phone for Claim Dispute. The designated staff shall follow up on the case with the respective issuer for further settlement.

Both the Cardholders and bank (Card Issuer) have the right to question or dispute a transaction. If such questions or disputes are not resolved, a Chargeback may occur.

Cases of Chargeback:

In any of the following situations, the issuing bank can initiate chargeback:

1. Processing Error

When a merchant makes an error and a transaction is billed incorrectly, upon the cardholder’s instruction the issuing bank can charge back electronically via Visa Net to the acquiring bank.

2. Fraudulent Multiple Transactions

This chargeback applies when multiple transactions occurred on a single card at the same merchant outlet without the cardholder’s permission.

3. Duplicate Processing

A single transaction was processed more than once using the same account number erroneously.

Chargeback Settlement Process

  • The chargeback Settlement process is as follows:
  • Chargeback lodged by Card Issuing bank on behalf of the customer is provided to acquiring Bank via card Association.
  • Chargeback notification is sent to merchant in specific Format /Excel/PDF for justification.
  • Chargeback Response with Proof of sales/delivery is provided for the Transaction by the merchant. (Maximum 26 Days).
  • Chargeback resolution is settled to card association and issuing bank on the final verdict.

a)If chargeback claim successfully:

  • Report is provided to the merchant on the transaction Details as per specified format and Amount is Debited from the merchant account maintained at NIC ASIA or adjusting any future payment.

b)If charge Back claims are unsuccessful:

  • Report is provided to the merchant on the unsuccessful claim.

Other

Things to be remembered by Customers to Mitigate Risk

  • Customer should not save their card detail on the web browser.
  • Customer should not share their card details with others.
  • Upon receiving the OTP, the customer should not share the OTP with others.
  • Prior to entering the card information and One Time Password in any online Merchant websites makes sure that the websites are genuine.
  • Enter the card information and one-time password only once.
  • If the customer gets an email or pop-up message that asks for personal or financial information, do not reply or click on the link in the message.
  • Never respond to any emails asking for your confidential information such as User ID, Password, OTP, etc.

Advantages of using Payment Gateway for customers as well as Merchants

  • Simple
  • Convenience
  • Increased sales
  • Low cost
  • Faster checkout
  • Guaranteed payment
  • Greater risk management