When Paramount receives a return notification from the bank, we send a return notification to the event notification URL specified by the merchant during the system integration. The merchant system parses the data in the notification and processes the FI return internally.

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Returned Transaction Reasons

Transactions may be returned from a bank for several reasons. For more information, see EFT Return Codes.

Return Notification Verification

Next, the return (event) notification needs to be confirmed by the merchant in the same way that payment notifications are. That is, the merchant system must send the verification request back to Paramount and echo an exact copy of the original event notification. The copy must be a string that matches the notification message exactly (byte-to-byte) and not be a reconstructed set of parameters, even with the same set of parameters and values.

After parsing and verifying the return notification, the merchant forwards the FI return information internally for processing.

For more information, see Notifications.

Representment

All returns, except those with return codes 901 (insufficient funds) or 908 (funds not cleared), are final and will not be represented. Whether the return will be represented is indicated in the transactionStatus field of the return notification. For returns that are not represented, Paramount Commerce will deduct the returned transaction amount from the merchant’s Instant Bank Transfer account balance.

However, if the return code is 901 (insufficient funds), Paramount Commerce represents the amount of those transactions one time and sends a return notification. Funds are not deducted from the merchant’s account balance unless we are unable to retrieve the funds from the consumer.

The return notification also includes the nextActionDate, which indicates the date when the payment will be represented to the bank.

{
   "merchant":{
      "merchantId":"ABC12345",
      "merchantSubId":"20",
      "merchantTransactionId":"153237624",
      "merchantUserId":"user123"
   },
   "transaction":{
      "transactionType":"DEBIT",
      "transactionFee":150,
      "transactionStatus":"RETURNED_WITH_REPRESENTMENT",
      "transactionAmount":2000,
      "currencyCode":"CAD",
      "transactionId":"8FM7PDLSITRYRTU3UAUPCKSUhYx2",
      "returnCode":"901",
      "nextActionDate":"2024-11-15"
   }
}

Representment Process

After receiving the first return of the original transaction, Paramount:

1. Sends a notification to the merchant indicating that the payment will be represented. The date when the payment will be represented is specified in the nextActionDate.
2. Re-submits the payment to the bank on the specified date. We recommend that the merchant wait five business days to confirm if the representment was successful. If there is no return from the representment, then the payment can be considered successfully processed.

If there is a return of the representment, then the payment is considered disposed (final status).

Risk Management

Even with our comprehensive risk management controls, returns are inevitable. We urge you to carefully review our recommendations and implement your own risk management tools to manage returns. Merchants are responsible for following up with consumers to collect funds in the event of returned transactions.

Paramount Commerce has several recommendations that the merchant can implement to manage returned transactions and mitigate risk, fraud, and returns. Review this section carefully.

We recommend that returns are handled based on the return code. For example, in the case of 911 (account frozen) returns, the merchant needs to contact the consumer to ask them to contact their bank to reactivate the account. A best practice to receive notice is to request that the consumer fax or email a statement from their bank confirming that the bank account is active before allowing the consumer to attempt another transaction.