About Credit Card Surcharges

Note: The "CreditCardSurcharge" feature is a licensed add-on. Please contact Naviga Global Support to license this feature.

Merchants sometimes add a small surcharge percentage to payments made by credit card, to help recoup the processing fees from the credit card company. Circulation can assess a surcharge percentage on subscriber credit card payments, based on the product and credit card type.

The surcharge is based on the total payment amount, including the term cost, tip, tax and cash adjustments. When a surcharge applies to a payment, a cash subscriber payment adjustment is created for the surcharge amount.

Setup for Credit Card Surcharges

In order to add a surcharges to credit card payments, you must:

• Activate “CreditCardSurcharge” add-on in Add On Activation.

• You can allow certain users permissions to waive the credit card surcharge using the “CCSurchargeOvrd” security item in Transaction Security setup.

• Define a subscriber payment adjustment code for credit card surcharges. This code should be set up as a cash adjustment that does not update the expire date or the wallet. Once defined, the new payment adjustment code should not be used for any other purposes outside of credit card surcharges.

• Select the new payment adjustment code for the Business Rule— What is the subscriber adjust code used for storing subscriber credit card surcharges? (Subscriber Payments section).

• You may also wish to define a separate credit GL account for storing surcharge revenue (the debit GL account will be Cash).

• In Credit Card Account setup (see Credit Card Account in the Setup Manual), set the actual surcharge percentage for the applicable products and credit card types. You can also specified whether the surcharge amount is taxable.

Entering Payments with Surcharges

Credit card surcharges can be applied to payments entered in Customer Service, the Customer Service API, or the Circulation API, as well as credit card auto renews. Payments added in Batch Payments in the Accounting module or in iServices Subscriber do not currently qualify for surcharges.

When a credit card payment is entered in Customer Service for a publication and credit card type flagged for surcharge in Credit Card Account setup, a warning message displays when accepting the payment, listing the surcharge amount. The user can click Yes to continue, or No to cancel the payment (if the user has credit card override permissions in Transaction Security and clicks No, the payment will still be entered, but without the surcharge).

If you accept the surcharge, the surcharge amount will be added to the total payment amount. The surcharge information can be displayed by viewing the payment transaction and clicking on the Adj button to the right of the Adjustment field.

Note: When the subscriber is on a combo subscription, the credit card surcharge adjustment will be added to the primary subscription.

If a subscriber is on credit card auto pay for a publication and credit card type that has a surcharge defined, the surcharge amount will automatically be calculated and added to the payment during Auto Payments processing. This includes subscribers who started or changed to credit card auto renew in iServices Subscriber.

If surcharges apply to credit card payments brought in via Lockbox Processing or the Subscriber Activity Import, you can import the surcharge as a payment adjustment (the surcharge must be calculated outside of Circulation). Place the total surcharge value (surcharge amount plus surcharge tax, if applicable) in the Adjustment Amount field. The file map used must be set up to assign the subscriber payment adjustment code used for surcharges to the Adjustment Amount field.

Credit card surcharges will display on the Subscriber Payment Journal as subscriber payment adjustments. The journal also has an adjustment recap. If you import credit card payment authorizations/declines and apply surcharges, the Tran Amount should include the surcharge amount.

Surcharge Examples

Some examples below illustrate how surcharge amounts are calculated and added to payments.

Example 1

Assume:

• Publication Taxable: Yes

• Surcharge: 3%

• Surcharge Taxable: No

• Payment amount = 48.00

• Tip amount = 2.00

• Tax = 6%

In this example:

• The payment amount entered for the credit card would be 50.00 (48.00 term amount plus a 2.00 tip)

• The surcharge would apply to the entire initial payment amount of 50.00. 3% of 50.00 = 1.50

• The final payment amount would be 51.50 (a 50.00 payment with a 1.50 surcharge)

• The tax would be 6% of 48.00 = 2.88

• The total payment amount applied towards the subscription would be 48.00 - 2.88 = 45.22

Example 2

Assume the same scenario as Example 1, but with Surcharge Taxable = Yes. In this case:

• The payment amount entered for the credit card would be 50.00

• The surcharge would apply to the entire initial payment amount of 50.00. 3% of 50.00 = 1.50

• The surcharge would be taxed. 6% of 1.50 is .09

• The total surcharge would then be 1.50 + .09 = 1.59

• The final payment amount would be 51.59 (a 50.00 payment with a 1.59 surcharge)

• The tax on the subscription would be the same as before: 6% of 48.00 = 2.88

• The total payment amount applied towards the subscription would still be 48.00 - 2.88= 45.22

Refunding Surcharges

If you wish to refund the surcharge amount during a permanent stop, you will need to override the default refund amount to add back in the surcharge value. Note that the Business Rule— What is the maximum variance from the calculated amount that an operator may enter for the refund paid? will govern the maximum amount you may manually override the refund.

General Ledger Entries for Surcharges

When a credit card surcharge is assessed for a payment, the credit GL account specified in Subscriber Payment Adjustment setup will be credited for the surcharge amount. The GL account specified for the publication and credit card type in Credit Card Account setup will be debited for the amount (along with the term payment and tax amount).

The credit/debit entries for a typical payment with a surcharge are shown below. Assume a payment for $100 term, county tax is 10%, surcharge on credit card payment is 1.5%, and surcharge is not taxed.