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Article published in Issue Number: 061202

Descriptors decoded

By Ross Federgreen, CSRSI

Many merchants ask me, "How do I get a specific phrase on cardholder statements to reflect the transactions that occur between cardholders and me?" The answer is use a descriptor.

A descriptor is an identifying phrase, telephone number or some combination thereof that appears on cardholder statements. Once merchants grasp this, their next question often is, "How can I maximize the value of my descriptor?"

Descriptors delineated

Descriptors are meant to remind cardholders of specific transactions and offer them access to merchants. Thus, merchants (and cardholders) obtain maximum benefit when descriptors are clearly connected to transactions and when they contain a phone number where merchants can be reached.

Many merchants ask if having a descriptor will protect them against chargebacks. Well-planned descriptors should offer merchants additional protection from chargebacks if they make reported transactions easy for cardholders to recognize and if they provide a working telephone number to call for customer service.

However, under no circumstances do descriptors guarantee against chargebacks. The notion that descriptors provide such a guarantee is a widely held misconception that needs to be corrected immediately whenever it is voiced.

Is there any legitimate argument for omitting descriptors on a cardholder statement? The answer is no. A merchant's job is to receive and retain payments.

ISOs and merchant level salespeople (MLSs) need to educate merchants to help them achieve maximum profitability. A descriptor is a proven and powerful tool in this regard.

Descriptors divided

There are two major categories of descriptors: static and dynamic. Static descriptors, sometimes called hard descriptors, are chosen by merchants. They change only upon merchant request. Changes affect all transactions associated with a specific merchant and merchant identification number.

Alternatively, dynamic descriptors are used when merchants elect to alter descriptors on a per-transaction basis. These are sometimes called soft descriptors.

Dynamic descriptors enable merchants to submit distinct merchant descriptors and toll-free support numbers for each transaction. They can be tailored to particular products or departments within a storefront.

This enables retailers to subdivide merchandising sites into multiple departments or stores with unique descriptions and customer support lines. These are posted on cardholders' statements for clarification and resolution purposes.

Descriptors are driven by a number of factors. Most important is the number of characters that can be put in a given descriptor field. Although there is some variability, it is fair to use the number 22 as a guide.

This means the length of the descriptor, including lettered and numbered characters, typically cannot exceed 22. Sometimes a different number is set by the processor involved.

Once a processor accepts a descriptor, merchants face additional challenges: First, not all middleware or universal transaction gateways have the ability to pass on the information.

Second, not all issuers can accept all descriptor formats for inclusion in their cardholders' statements. This tends to be more of a problem with dynamic descriptors than with static descriptors.

Descriptors deliberated

Working with merchants in choosing descriptors can be a very important relationship-building tool.

It's critical to emphasize to merchants that clarity is key and that an 800 number to customer service should (and in the author's opinion must) be included. This will typically take up 10 characters.

When determining a descriptor name to fill the approximately 12 remaining characters, think about the name by which customers will recognize the merchant.

Do not try to be clever. For example, if the company sells a product line called 1234, and if the company's legal name, ABCD, is unknown to customers, it would be most beneficial to use 1234 in the descriptor, not ABCD.

Placing the name before the telephone number in a descriptor is critical. Few, if any, customers are more likely to recognize a telephone number than a name. It is also prudent, where possible, to obtain a telephone number that reflects the name or a key component of the product.

When creating dynamic descriptors, exercise care. It may make sense from a merchant's perspective to label different areas within the business with terms used internally.But it is of little use - and could even be detrimental to the merchant - if customers cannot immediately recognize the terms.

Descriptors discerned

Finally, remember to help merchants understand how to determine descriptor content. For each merchant account, know the required character length for the applicable descriptor field.

Find out if any specific middleware is capable of transmitting a static or dynamic descriptor to the processor being used.

Verify the accuracy of descriptor information with merchants, and clearly inform them that their customer service numbers must be active.

As ISOs and MLSs, you can use these tips to resolve difficult issues pertaining to descriptors and further enhance your working relationships.

Passing on such knowledge demonstrates to merchants that you bring much more to them than this week's "best price" on processing services.

Ross Federgreen is founder of CSRSI, The Payment Advisors, a leading electronic payment consultancy specifically focused on the merchant. He can be reached at 866-462-7774, ext. 23, or

Article published in issue number 061202

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