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What to do when a customer’s credit card is declined

What to do when a customer’s credit card is declined

There’s a universal sense of panic when someone’s credit card is declined – for the shopper, the cashier and even observers nearby. People know that having your card declined at a store can be an embarrassing, stressful and generally unpleasant experience. From the perspective of a store owner, the resulting delays may create unanticipated foot traffic and crowding.

If a customer tries to pay with a card that’s declined, it’s important you strike a balance between preventing fraudulent purchases and maintaining your reputation as a caring and supportive brand. Review the following steps with your employees to resolve any credit issues that may arise when shoppers queue up at the register stand.

1. Know the potential causes
Although it’s often assumed that a credit card is declined because it’s been maxed out or hasn’t been paid recently, there are several reasons for defective cards. It’s helpful for employees to know all of these causes so they can offer suggestions to customers during this stressful time.

The credit card itself might have physical damage, such as a mutilated magnetic strip, or it may have expired. There’s also the chance that the customer’s card is just fine and the problem is coming from your point-of-sale machine.

Additionally, the shopper’s bank could put holds on credit cards for a myriad of reasons, all of which are meant to protect itself from loss. When fraudulent charges go through, it’s often the bank who has to cover the damages. As a result, credit card companies may freeze an account if purchases are made in a new geographic location or don’t seem to match the typical shopping patterns of the card owner. If an account was put at risk from a data breach, the bank will probably deactivate the card and mail a new one – something the patron might not be aware of.

2. Try, try again
Before the cashier asks for another card or contacts a manager, they should try swiping the card a second time. If that still doesn’t work, manually type the credit card number and billing information into the system.

3. Ask for backup
Next, employees should see if the customer has an alternate form of payment. This can be a fast and easy solution from your perspective, because it becomes an issue for the shopper to deal with after completing the purchase. However, the patron might not have brought a backup card, checkbook or cash – meaning he or she can either abandon the sale or discuss further options with you.

4. Direct to a private location
If a customer wants to resolve the issue with his or her credit card in the moment, it’s best to bring them away from the line, Retail Minded explained. Try the card on another cash register to make sure it’s not a problem on your end, then ask the shopper if he or she would like to borrow a phone to contact the bank.