Quote:
Originally Posted by SmokeyTheBear
I bought my daughter a visa gift card to use with her nintendo dsi game, she bought a few games and such , she went to buy a cover for it from an online site and the card was declined, everything was filled in correctly so it shouldnt have been declined , so i called up the cc company to find out what was going on. The lady explained the "pre-auth" was in us dollars and the charge came thru in candian dollars , so they held the pre-auth and there wasn't enough money left to cover the charge so they declined it, the difference was pennies. I'm sure this happens often as i'm pretty sure i have had this happen before ( but never found out why until now )
Perhaps some processors can chime in with why this wouldnt happen with them or if it would , that it will be fixed.
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My question is why was the pre-auth in US but the sale in Canadian dollars?
Was the card issued in Canada?
Regardless, when setting up a Merchant Account internationally, the best possible solution is to do multi-currency conversion during the course of the transaction:
Example:
U.S. Merchant with off-shore account (E.U.). Japanese customer purchases using a card issued from a Bank in Japan. The processor adjusts currency in real time so it's a Yen to Yen sale. Auth/Capture occurs in currency of card origin and then is settled in currency of Merchant origin.
With some few exceptions, this avoids both a conversion issue as described above and avoids an additional line item charge for currency conversion showing up on Cardholder statement, reducing likelihood of dispute.
Occasionally, issuing banks will still charge the currency conversion percentage even though it was submitted in currency of origin because they have built their files to trigger currency conversion fees based on Merchant origin location.