Transaction Processing Rules

Transaction Processing Rules 21 January 2016 TPR

Notices Notices Proprietary Rights The information contained in this document is proprietary and confidential to MasterCard International Incorporated, one or more of its affiliated entities (collectively MasterCard ), or both. This material may not be duplicated, published, or disclosed, in whole or in part, without the prior written permission of MasterCard. Trademarks Trademark notices and symbols used in this document reflect the registration status of MasterCard trademarks in the United States. Please consult with the Global Customer Service team or the MasterCard Law Department for the registration status of particular product, program, or service names outside the United States. All third-party product and service names are trademarks or registered trademarks of their respective owners. Disclaimer MasterCard makes no representations or warranties of any kind, express or implied, with respect to the contents of this document. Without limitation, MasterCard specifically disclaims all representations and warranties with respect to this document and any intellectual property rights subsisting therein or any part thereof, including but not limited to any and all implied warranties of title, non-infringement, or suitability for any purpose (whether or not MasterCard has been advised, has reason to know, or is otherwise in fact aware of any information) or achievement of any particular result. Without limitation, MasterCard specifically disclaims all representations and warranties that any practice or implementation of this document will not infringe any third party patents, copyrights, trade secrets or other rights. Translation A translation of any MasterCard manual, bulletin, release, or other MasterCard document into a language other than English is intended solely as a convenience to MasterCard customers. MasterCard provides any translated document to its customers AS IS and makes no representations or warranties of any kind with respect to the translated document, including, but not limited to, its accuracy or reliability. In no event shall MasterCard be liable for any damages resulting from reliance on any translated document. The English version of any MasterCard document will take precedence over any translated version in any legal proceeding. Information Available Online MasterCard provides details about the standards used for this document including times expressed, language use, and contact information on the Publications Support page available on MasterCard Connect. Go to Publications Support for centralized information. Transaction Processing Rules 21 January 2016 TPR

Applicability of Rules in this Manual Applicability of Rules in this Manual This manual contains Rules for the MasterCard, Maestro and Cirrus brands. The Rules relate to Activity conducted pursuant to a License that MasterCard grants to a Customer for use of one or more of these brands. If a particular brand or brands is not mentioned in a Rule, then the Rule applies to all three brands. The Rules in this manual pertain to the processing of Transactions. As used herein, a Transaction means a transaction resulting from the use of a MasterCard, Maestro, or Cirrus Card, as the case may be. The below table describes the applicability of the Rules for particular types of Transactions. Please note that the term POS Transaction refers to a Transaction that occurs at a Merchant location, whether in a Card-present environment at an attended or unattended POS Terminal, or in a Card-not-present environment. In a Card-not-present environment, this may include electronic commerce ( e-commerce ), mail order, phone order, or recurring payment Transactions. Rules relating to MasterCard POS Transactions Maestro POS Transactions ATM Transactions Manual Cash Disbursement Transactions MasterCard Electronic Transactions MasterCard Mobile Remote Payment (MMRP) Transactions Apply to A POS Transaction conducted with a MasterCard Card. A POS Transaction conducted with: A Maestro Card, or A MasterCard Card issued using a BIN identified by the Corporation as Debit MasterCard and routed to the MasterCard Single Message System. A Transaction conducted with a MasterCard, Maestro, or Cirrus Card at an ATM Terminal and routed to the Interchange System. A cash withdrawal Transaction conducted at a Customer financial institution teller with: A MasterCard Card, or A Maestro or Cirrus Card at a PIN-based In-Branch Terminal and routed to the Interchange System. A POS Transaction conducted with a MasterCard Electronic Card at a MasterCard Electronic Merchant. A POS Transaction performed by an enrolled consumer using a mobile device registered by the Issuer or its Service Manager and having MasterCard Mobile Remote Payment functionality. The consumer, as a MasterCard or Maestro Cardholder, initiates and authenticates payments by entering a PIN or mobile-specific credentials on the mobile device. Transaction Processing Rules 21 January 2016 3

Applicability of Rules in this Manual Rules relating to Payment Transactions Apply to A Transaction that transfers funds to an Account. A Payment Transaction is not a credit that reverses a previous purchase. Includes MoneySend Payment Transactions. Modifying Words and Acronyms From time to time, the meanings of the above terms are modified by the addition of another word or acronym. For example, a Debit MasterCard POS Transaction means a Transaction resulting from the use of a Debit MasterCard Card at the point of sale (POS). However, for ease of use, not every modifying term is defined. While MasterCard alone interprets and enforces its Rules and other Standards, these Transaction Processing Rules endeavor to use defined terms and other terms and terminology in a plain manner that will be generally understood in the payments industry. Variations and Additions to the Rules for a Geographic Area Variations and/or additions ( modifications ) to the Rules are applicable in geographic areas, whether a country, a number of countries, a region, or other area. In the event of a conflict between a Rule and a variation of that Rule, the modification is afforded precedence and is applicable. The Rules set forth in this manual are Standards and MasterCard has the sole right to interpret and enforce the Rules and other Standards. Transaction Processing Rules 21 January 2016 4

Summary of Changes, 21 January 2016 Summary of Changes, 21 January 2016 The below table reflects changes included in this update of the Transaction Processing Rules manual. For more information about changes to the Rules, see the MasterCard Rules Report in the Rules and Policies section of Publications on MasterCard Connect. Chapter Number Rule Name Source or Explanation of Revisions 2 Europe Region Corrected numbering from 2.2.1 to 2.2.2 2.2.2 Stand-In Processing Service 3 Europe Region 3.10 Returned Products and Canceled Services 3.10.1 Refund Transactions See Clarification Standards for Refunds and Chargeback Reason Code 4860 (Credit Not Processed), Europe Region Operations Bulletin No. 9, 1 September 2015. Transaction Processing Rules 21 January 2016 5

Summary of Changes, 15 December 2015 Summary of Changes, 15 December 2015 The below table reflects changes included in this update of the Transaction Processing Rules manual. For more information about changes to the Rules, see the MasterCard Rules Report in the Rules and Policies section of Publications on MasterCard Connect. Chapter Number Rule Name Source or Explanation of Revisions Throughout Throughout Rule numbers have been added to the third level (e.g., 1.1.1). 1 Acquirer Host System Requirements This Rule has been moved to chapter 2; see Rule 2.1.1. 2 2.2.1 Issuer Host System Requirements Formerly the first paragraph of Issuer Authorization Requirements. Clarified that authorization host support for refund Transactions is required for single message processing only. 2 2.2.2 Stand-In Processing Service Text has been reorganized, and clarified with respect to the use of blocking services. 2 2.5.1 Preauthorizations MasterCard POS Transactions 2 2.5.2 Preauthorizations Maestro POS Transactions 2 2.14 Balance Inquiries Asia/Pacific Region 2.14 Balance Inquiries 2 Europe Region 2.17 Euro Conversion 3 3.1.1 Cardholder Must Present a Card 3.2 MasterCard Manual Cash Disbursement Acceptance Procedures 3 3.1 Merchant Acceptance Procedures 3.1.2 Obtaining an Authorization for a MasterCard POS Transaction Incorrect reference to Europe Region variation removed. Reference to existing Europe Region variation added. Regional variation was misplaced; moved from 2.2. Issuer Authorization Requirements. See Changes to Global Floor Limit Terminology, Global Security Bulletin No. 9, 15 September 2015. See Revised Standards for Merchant Acceptance Procedures, Global Security Bulletin No. 7, 15 July 2015. Clarified acceptance procedure at non-chipenabled POS Terminals; also see Changes to Global Floor Limit Terminology, Global Security Bulletin No. 9, 15 September 2015. Transaction Processing Rules 21 January 2016 6

Summary of Changes, 15 December 2015 Chapter Number Rule Name Source or Explanation of Revisions 3 3.1.4 Obtaining an Authorization for a Maestro POS Transaction See Changes to Global Floor Limit Terminology, Global Security Bulletin No. 9, 15 September 2015. 3 3.1.6 Use of a Consumer Device CVM See Revised Standards for Consumer Device Cardholder Verification Methods, Global Security Bulletin No. 8, 17 August 2015. 3 3.4 POI Currency Conversion See Revised Standards for POI Currency Conversion Consolidation and Simplification, Global Operations Bulletin No. 5, 1 May 2015 3 3.9.1 POS and MasterCard Manual Cash Disbursement Transaction Receipt Requirements 3 3.9.2 ATM and PIN-based In-Branch Terminal Transaction Receipt Requirements Title change; clarifications; text on prohibited information moved to Rule 3.9.4. Requirement to provide street address removed (in alignment with Security Rules and Procedures section 3.11.2). Also see Revised Standards for Merchant Acceptance Procedures, Global Security Bulletin No. 7, 15 July 2015. Clarifications. 3 3.9.4 Prohibited Information Text moved from Rule 3.9. 3 3.11 Transaction Records 3.11.1 Retention of Transaction Records 3 Asia/Pacific Region 3.10 Returned Products and Canceled Services 3.10.1 Refund Transactions 3 Europe Region Updated numbering of cross-referenced rules; subsection heading on record retention added. See Revised Standards Relating to Surcharge Refunds in Australia, Australia Operations Bulletin No. 1, 1 September 2015. Title change; clarification. 3.9.1 POS and MasterCard Manual Cash Disbursement Transaction Receipt Requirement Transaction Processing Rules 21 January 2016 7

Summary of Changes, 15 December 2015 Chapter Number Rule Name Source or Explanation of Revisions 4 Contactless EMV Mode Transaction Offline Authorization Limit Amounts 4 Asia/Pacific Region 4.9 Purchase with Cash Back Transactions 4 Canada Region See Changes to Global Floor Limit Terminology, Global Security Bulletin No. 9, 15 September 2015. This section has been moved to chapter 5 of the Quick Reference Booklet. Insertion of India Rule inadvertently placed in the Middle East/Africa Region section; minor rewording. (India is located in the Asia/Pacific Region.) Minor rewording. 4.9 Purchase with Cash Back Transactions 4 Middle East/Africa Region 4.9 Purchase with Cash Back Transactions 4 Europe Region 4 Europe Region 4.5.2 Maestro Contactless Transit Aggregated Transactions 4.9 Purchase with Cash Back Transactions 4 Latin America and the Caribbean Region 4.9 Purchase with Cash Back Transactions 4 Middle East/Africa Region 4.9 Purchase with Cash Back Transactions 4 United States Region 4.14 MasterCard Manual Cash Disbursement Transactions Removal of India Rule inadvertently placed in the Middle East/Africa Region section. (India is located in the Asia/Pacific Region.) Minor rewording of South Africa Rule. Clarification of applicable message type for authorization reversals and advices in the Europe Region Minor rewording; incorporation of Debit MasterCard into issuer support mandate per Revised Standards for Issuer Support for Purchase with Cash Back and for MARP, Europe Region Operations Bulletin No. 3, 1 March 2012. See Revised Standards for the Introduction of Purchase with Cash Back Transactions in Brazil, Brazil Operations Bulletin No. 10, 28 October 2015. Removal of India Rule inadvertently placed in the Middle East/Africa Region section. (India is located in the Asia/Pacific Region.) Moved U.S. Region variation from Rule 4.14.1, Non-discrimination Regarding Cash Disbursement Services, to Rule 4.14; no change to text. Transaction Processing Rules 21 January 2016 8

Summary of Changes, 15 December 2015 Chapter Number Rule Name Source or Explanation of Revisions 4 United States Region 4.19 Shared Deposits 4.19.5 ATM Terminal Clearing and Deposit Processing 5 5.1 Electronic Commerce Transactions Consolidation of ATM Terminal Clearing and Deposit Processing into one Rule; deletion of obsolete reference to the Chargeback Guide. Clarification regarding multiple shipments. 5.1.1 E-commerce Transactions Acquirer and Merchant Requirements 5 5.4 Installment Billing for Domestic Transactions Participating Countries Only Addition of text formerly located in sections 1.23, 1.23.1, and 1.23.2 of the Chargeback Guide. 6 6.3 MoneySend Payment Transactions See Revised Standards for MoneySend Payment Transaction Support for Small Business Commercial Card Issuers, Global Operations Bulletin No. 10, 1 October 2015. 7 Europe Region 7.3.1 Contactless Reader Requirements 7 Europe Region 7.4.1 Contactless-enabled POS Terminals See New Standards for Migration to MasterCard Contactless Reader Specification Version 3.0, Czech Republic Operations Bulletin No. 5, 28 September 2015; New Standards for Migration to MasterCard Contactless Reader Specification Version 3.0, Slovakia Operations Bulletin No. 4, 28 September 2015; New Standards for Migration to MasterCard Contactless Reader Specification Version 3.0 or Above, Europe Region Operations Bulletin No. 9, 1 September 2015. Text has also been reformatted; erroneous duplication of text has been removed. See Revised Standards for CVM at Contactless POS Terminals, Europe Region Operations Bulletin No. 10, 1 October 2015. Subheadings have been added; the order of text has been moved accordingly. 7 7.7 Hybrid Terminal Requirements See Announcement of Revised Standards EMV Security Roadmap, Global Operations Bulletin No. 9, 1 September 2015. Transaction Processing Rules 21 January 2016 9

Summary of Changes, 15 December 2015 Chapter Number Rule Name Source or Explanation of Revisions 7 United States Region 7.7 Hybrid Terminal Requirements 7 United States Region 7.7 Hybrid Terminal Requirements See Revised Standards for Chip and Terminal Requirements in the U.S. Region, U.S. Region Operations Bulletin No. 7, 31 August 2015. See Changes to Global Floor Limit Terminology, Global Security Bulletin No. 9, 15 September 2015. Appendix A Latin America and the Caribbean Region Added Cuba to the Latin America and the Caribbean Region geographic region list. Appendix C MasterCard Mobile Remote Payment Transactions Added MasterCard Mobile Remote Payment Transaction requirements Appendix D CAT Transactions Removed redundant text that also appears in Rule 4.10, Transactions at Unattended POS Terminals. Appendix D CAT Level Requirements For CAT 2 and CAT 3, clarified that the same maximum amount applies to contact and contactless transactions when both are supported. Also see Revised Standards for Cardholder-Activated Terminal 3 Devices, Global Operations Bulletin No. 10, 1 October 2014; Revised Standards for Cardholder- Activated Terminal 3 Devices in the Europe Region, Global Operations Bulletin No. 2, 2 February 2015; and Changes to Global Floor Limit Terminology, Global Security Bulletin No. 9, 15 September 2015 and Revised Standards for Contactless and Quick Payment Service Transactions in the United Kingdom, Global Operations Bulletin No. 8, 1 August 2014. Appendix D CAT Level 1: Automated Dispensing Machines (CAT 1) CAT Level 2: Self-Service Terminals (CAT 2) CAT Level 4: In-Flight Commerce (IFC) Terminals (CAT 4) CAT Level 7: Transponder Transactions (CAT 7) See Changes to Global Floor Limit Terminology, Global Security Bulletin No. 9, 15 September 2015. Appendix E New appendix Duplication of Chargeback Guide Appendix C, CVM Limit Amounts. Transaction Processing Rules 21 January 2016 10

Summary of Changes, 15 December 2015 Chapter Number Rule Name Source or Explanation of Revisions Appendix F Appendix F Model Screens Offering POI Currency Conversion Model Receipt for Withdrawal Completed with POI Currency Conversion Model Screens Offering POI Currency Conversion See Revised Standards for POI Currency Conversion Consolidation and Simplification, Global Operations Bulletin No. 5, 1 May 2015. See Revised Standards for POI Currency Conversion, Global Operations Bulletin No. 10, 1 October 2015. Appendix H MasterCard Token Vault See Revised Standards for Tokenization and the MasterCard Digital Enablement Service, Global Operations Bulletin No. 8, 1 August 2014. Appendix H Appendix H Appendix H Cross-border Transaction Interregional Transaction Intracountry Transaction Intraregional Transaction MasterCard Europe Transaction Cardholder Verification Method (CVM) Consumer Device Cardholder Verification Method, Consumer Device CVM, CDCVM On-Device Cardholder Verification Payment Application Account Enablement System Transaction Management System Trusted Service Manager Clarification of terms. See Revised Standards for Consumer Device Cardholder Verification Methods, Global Security Bulletin No. 8, 17 August 2015. Digital Activity Service Provider Registration Details and Revised Standards, Global Operations Bulletin No. 10, 1 October 2015. Appendix H MasterCard Europe Changed MasterCard Europe sprl to MasterCard Europe SA to reflect a legal entity conversion that took effect 1 July 2015. Transaction Processing Rules 21 January 2016 11

Contents Contents Notices...2 Applicability of Rules in this Manual...3 Summary of Changes, 21 January 2016... 5 Summary of Changes, 15 December 2015...6 Chapter 1: Connecting to the Interchange System and Authorization Routing... 22 1.1 Connecting to the Interchange System...24 1.2 Authorization Routing MasterCard POS Transactions... 24 1.3 Authorization Routing Maestro POS, ATM Terminal, and PIN-based In-Branch Terminal Transactions... 24 1.3.1 Routing Instructions and System Maintenance... 25 1.3.2 Chip Transaction Routing...25 1.3.3 Domestic Transaction Routing...25 1.4 ATM Terminal Connection to the Interchange System... 26 1.5 Gateway Processing... 26 1.6 POS Terminal Connection to the Interchange System...26 Variations and Additions by Region... 27 Asia/Pacific Region... 27 1.4 ATM Terminal Connection to the Interchange System... 27 1.6 POS Terminal Connection to the Interchange System... 27 Canada Region... 27 1.3 Authorization Routing Maestro POS, ATM Terminal, and PIN-based In-Branch Terminal Transactions...27 1.4 ATM Terminal Connection to the Interchange System... 28 Europe Region... 28 1.3 Authorization Routing Maestro POS, ATM Terminal, and PIN-based In-Branch Terminal Transactions...28 1.4 ATM Terminal Connection to the Interchange System SEPA Only... 28 Latin America and the Caribbean Region...28 1.4 ATM Terminal Connection to the Interchange System... 28 1.6 POS Terminal Connection to the Interchange System... 29 United States Region...29 1.1 Connecting to the Interchange System... 29 Transaction Processing Rules 21 January 2016 12

Contents 1.3 Authorization Routing Maestro POS, ATM Terminal, and PIN-based In-Branch Terminal Transactions...29 1.4 ATM Terminal Connection to the Interchange System... 30 Additional U.S. Region and U.S. Territory Rules...30 1.3 Authorization Routing Maestro POS, ATM Terminal, and PIN-based In-Branch Terminal Transactions...30 Chapter 2: Authorization and Clearing Requirements... 32 2.1 Acquirer Authorization Requirements... 35 2.1.1 Acquirer Host System Requirements U.S. Region Only... 35 2.2 Issuer Authorization Requirements... 36 2.2.1 Issuer Host System Requirements...36 2.2.2 Stand-In Processing Service...36 2.2.3 ATM Transaction Requirements for MasterCard Credit Card Issuers...37 2.3 Authorization Responses... 38 2.4 Performance Standards... 38 2.4.1 Performance Standards Acquirer Requirements... 39 2.4.2 Performance Standards Issuer Requirements...39 2.5 Preauthorizations... 40 2.5.1 Preauthorizations MasterCard POS Transactions... 40 2.5.2 Preauthorizations Maestro POS Transactions...41 2.5.3 Preauthorizations ATM and Manual Cash Disbursement Transactions... 41 2.6 Undefined Authorizations... 41 2.7 Final Authorizations... 42 2.8 Message Reason Code 4808 Chargeback Protection Period...42 2.9 Multiple Authorizations...43 2.10 Multiple Clearing Messages...44 2.11 Full and Partial Reversals...45 2.11.1 Reversal for Conversion of Approval to Decline...46 2.11.2 Reversal to Cancel Transaction... 46 2.12 Full and Partial Approvals and Account Balance Responses... 47 2.13 Corrections... 48 2.14 Balance Inquiries... 48 2.15 CVC 2 Verification for POS Transactions... 49 2.16 CVC 3 Verification for Maestro Contactless Magnetic Stripe Transactions Brazil Only...49 2.17 Euro Conversion Europe Region Only...49 2.18 Transaction Queries and Disputes... 49 2.19 Chargebacks for Reissued Cards...49 2.20 Correction of Errors...50 Variations and Additions by Region... 50 Asia/Pacific Region... 50 Transaction Processing Rules 21 January 2016 13

Contents 2.1 Acquirer Authorization Requirements... 50 2.2 Issuer Authorization Requirements...50 2.5 Preauthorizations...50 Canada Region... 50 2.12 Full and Partial Approvals and Account Balance Responses...51 Europe Region... 53 2.1 Acquirer Authorization Requirements... 53 2.2 Issuer Authorization Requirements...53 2.4 Performance Standards...53 2.5 Preauthorizations...54 2.7 Final Authorizations...55 2.8 Message Reason Code 4808 Chargeback Protection Period... 55 2.9 Multiple Authorizations... 56 2.11 Full and Partial Reversals... 56 2.12 Full and Partial Approvals and Account Balance Responses...57 2.14 Balance Inquiries...58 2.15 CVC 2 Verification for POS Transactions...58 2.17 Euro Conversion... 59 Latin America and the Caribbean Region...59 2.16 CVC 3 Verification for Maestro Contactless Magnetic Stripe Transactions Brazil Only... 59 United States Region...59 2.1 Acquirer Authorization Requirements... 59 2.2 Issuer Authorization Requirements...60 2.4 Performance Standards...62 2.5 Preauthorizations...62 2.11 Full and Partial Reversals... 63 2.12 Full and Partial Approvals and Account Balance Responses...65 2.14 Balance Inquiries...66 Chapter 3: Acceptance Procedures...67 3.1 Merchant Acceptance Procedures...69 3.1.1 Cardholder Must Present a Card... 69 3.1.2 Obtaining an Authorization for a MasterCard POS Transaction...71 3.1.3 MasterCard Cardholder Verification Requirements... 75 3.1.4 Obtaining an Authorization for a Maestro POS Transaction... 77 3.1.5 Maestro Cardholder Verification Requirements... 77 3.1.6 Use of a Consumer Device CVM... 78 3.2 MasterCard Manual Cash Disbursement Acceptance Procedures... 78 3.3 ATM Terminal and PIN-based In-Branch Terminal Transactions...79 3.4 POI Currency Conversion...79 3.4.1 Cardholder Disclosure Attended POS Terminal...80 Transaction Processing Rules 21 January 2016 14

Contents 3.4.2 Cardholder Disclosure Unattended POS Terminal... 80 3.4.3 Cardholder Disclosure ATM Terminal... 80 3.4.4 Cardholder Disclosure Transaction Receipt Information...81 3.4.5 Transaction Processing Requirements... 81 3.5 Multiple Transactions MasterCard POS Transactions Only... 82 3.6 Partial Payment MasterCard POS Transactions Only...82 3.7 Specific Terms of a Transaction... 82 3.8 Charges for Loss, Theft, or Damage MasterCard POS Transactions Only... 83 3.9 Providing a Transaction Receipt... 83 3.9.1 POS and MasterCard Manual Cash Disbursement Transaction Receipt Requirements... 84 3.9.2 ATM and PIN-based In-Branch Terminal Transaction Receipt Requirements... 85 3.9.3 Primary Account Number (PAN) Truncation and Expiration Date Omission... 86 3.9.4 Prohibited Information...86 3.10 Returned Products and Canceled Services...86 3.10.1 Refund Transactions...87 3.11 Transaction Records...88 3.11.1 Retention of Transaction Records... 88 Variations and Additions by Region... 89 Asia/Pacific Region... 89 3.1 Merchant Acceptance Procedures... 89 3.10 Returned Products and Canceled Services... 89 Canada Region... 89 3.9 Providing a Transaction Receipt...89 Europe Region... 90 3.1 Merchant Acceptance Procedures... 90 3.9 Providing a Transaction Receipt...90 3.10 Returned Products and Canceled Services... 91 Latin America and the Caribbean Region...92 3.1 Merchant Acceptance Procedures... 92 United States Region...92 3.1 Merchant Acceptance Procedures... 92 Additional U.S. Region and U.S. Territory Rules...93 3.10 Returned Products and Canceled Services... 93 Chapter 4: Card-Present Transactions...94 4.1 Chip Transactions at Hybrid Terminals...97 4.2 Offline Transactions Performed on Board Planes, Trains, and Ships...97 4.3 No-CVM Magnetic Stripe and Contact Chip Maestro POS Transactions Europe Region Only... 98 4.4 Contactless Transactions at POS Terminals... 98 4.5 Contactless Transit Aggregated Transactions...99 Transaction Processing Rules 21 January 2016 15

Contents 4.5.1 MasterCard Contactless Transit Aggregated Transactions... 99 4.5.2 Maestro Contactless Transit Aggregated Transactions... 99 4.6 Contactless Transactions at ATM Terminals... 100 4.7 Contactless-only Acceptance...100 4.8 Quick Payment Service (QPS) Program MasterCard POS Transactions Only...102 4.9 Purchase with Cash Back Transactions... 102 4.10 Transactions at Unattended POS Terminals...103 4.10.1 Automated Fuel Dispenser Transactions... 103 4.11 PIN-based Debit Transactions United States Region Only... 104 4.12 PIN-less Single Message Transactions United States Region Only... 104 4.13 Merchant-approved Maestro POS Transactions... 104 4.14 MasterCard Manual Cash Disbursement Transactions... 105 4.14.1 Non-discrimination Regarding Cash Disbursement Services... 105 4.14.2 Maximum Cash Disbursement Amounts... 105 4.14.3 Discount or Service Charges... 106 4.14.4 MasterCard Acceptance Mark Must Be Displayed... 106 4.15 Encashment of MasterCard Travelers Cheques...106 4.16 ATM Transactions... 106 4.16.1 Chained Transactions...106 4.16.2 ATM Transaction Branding... 107 4.17 ATM Access Fees...107 4.17.1 ATM Access Fees Domestic Transactions...107 4.17.2 ATM Access Fees Cross-border Transactions... 107 4.17.3 ATM Access Fee Requirements...107 4.18 Merchandise Transactions at ATM Terminals... 109 4.18.1 Approved Merchandise Categories... 110 4.18.2 Screen Display Requirement for Merchandise Categories... 111 4.19 Shared Deposits United States Region Only...111 Variations and Additions by Region... 111 Asia/Pacific Region... 111 4.9 Purchase with Cash Back Transactions... 111 4.10 Transactions at Unattended POS Terminals... 111 4.17 ATM Access Fees... 112 Canada Region... 112 4.9 Purchase with Cash Back Transactions... 112 4.10 Transactions at Unattended POS Terminals... 113 4.17 ATM Access Fees... 113 Europe Region... 114 4.3 No-CVM Magnetic Stripe and Contact Chip Maestro POS Transactions... 114 4.4 Contactless Transactions at POS Terminals...115 4.5 Contactless Transit Aggregated Transactions... 116 4.9 Purchase with Cash Back Transactions... 116 4.10 Transactions at Unattended POS Terminals... 117 Transaction Processing Rules 21 January 2016 16

Contents 4.13 Merchant-approved Maestro POS Transactions...118 4.14 MasterCard Manual Cash Disbursement Transactions... 118 4.17 ATM Access Fees... 119 4.18 Merchandise Transactions at ATM Terminals...119 Latin America and the Caribbean Region...119 4.4 Contactless Transactions at POS Terminals...119 4.5 Contactless Transit Aggregated Transactions... 120 4.9 Purchase with Cash Back Transactions... 120 4.17 ATM Access Fees... 121 Middle East/Africa Region... 121 4.9 Purchase with Cash Back Transactions... 121 United States Region...122 4.1 Chip Transactions at Hybrid Terminals... 122 4.9 Purchase with Cash Back Transactions... 122 4.10 Transactions at Unattended POS Terminals... 122 4.11 PIN-based Debit Transactions... 123 4.12 PIN-less Single Message Transactions... 123 4.14 MasterCard Manual Cash Disbursement Transactions... 124 4.17 ATM Access Fees... 124 4.18 Merchandise Transactions at ATM Terminals...124 4.19 Shared Deposits...124 Chapter 5: Card-Not-Present Transactions... 128 5.1 Electronic Commerce Transactions...130 5.1.2 E-commerce Transactions Issuer Requirements...130 5.1.3 Use of Static AAV for Card-not-present Transactions...131 5.2 Mail Order and Telephone Order (MO/TO) Transactions...131 5.3 Recurring Payment Transactions... 132 5.4 Installment Billing for Domestic Transactions Participating Countries Only... 132 5.4.1 Applicability of Rules... 133 5.4.2 Definitions...133 5.4.3 Transaction Processing Procedures... 134 5.5 Transit Transactions Performed for Debt Recovery...135 5.6 Use of Automatic Billing Updater... 135 Variations and Additions by Region... 135 Asia/Pacific Region... 135 5.1 Electronic Commerce Transactions... 135 5.2 Mail Order and Telephone Order (MO/TO) Transactions...136 Canada Region... 137 5.2 Use of Automatic Billing Updater...137 Europe Region... 138 5.1 Electronic Commerce Transactions... 138 Transaction Processing Rules 21 January 2016 17

Contents 5.2 Mail Order and Telephone Order (MO/TO) Maestro Transactions... 138 5.3 Recurring Payment Transactions...140 5.4 Installment Billing for Domestic Transactions Participating Countries Only...141 5.6 Use of Automatic Billing Updater...147 Latin America and the Caribbean Region...147 5.1 Electronic Commerce Transactions... 147 United States Region...148 5.1 Electronic Commerce Transactions... 148 Chapter 6: Payment Transactions and MoneySend Payment Transactions...149 6.1 Payment Transactions...150 6.1.1 Payment Transactions Acquirer and Merchant Requirements... 150 6.1.2 Payment Transactions Issuer Requirements... 151 6.2 Gaming Payment Transactions Europe Region Only...151 6.3 MoneySend Payment Transactions...152 Variations and Additions by Region... 152 Europe Region... 152 6.1 Payment Transactions... 152 6.2 Gaming Payment Transactions... 153 Chapter 7: Terminal Requirements...155 7.1 Terminal Eligibility...157 7.2 Terminal Requirements... 157 7.2.1 Terminal Function Keys... 158 7.2.2 Terminal Responses...158 7.2.3 Terminal Transaction Log...158 7.3 Contactless Payment Functionality...159 7.3.1 Contactless Reader Requirements... 159 7.3.2 Proximity Coupling Device Requirements... 160 7.4 POS Terminal Requirements...160 7.4.1 Contactless enabled POS Terminals... 160 7.4.2 Contactless-only POS Terminals...162 7.4.3 Mobile POS (MPOS) Terminals...162 7.4.4 Signature-based Maestro POS Terminals...163 7.5 Contactless-only Acceptance...163 7.6 ATM Terminal and PIN-based In-Branch Terminal Requirements...165 7.6.1 ATM Terminals...166 7.6.2 PIN-based In-Branch Terminals... 166 7.6.3 Contactless Payment Functionality... 166 7.7 Hybrid Terminal Requirements... 166 Transaction Processing Rules 21 January 2016 18

Contents 7.7.1 Hybrid POS Terminal Requirements... 167 7.7.2 Hybrid ATM Terminal and PIN-based In-Branch Terminal Requirements... 168 Variations and Additions by Region... 169 Asia/Pacific Region... 169 7.6 ATM Terminal and PIN-based In-Branch Terminal Requirements... 169 7.7 Hybrid Terminal Requirements...169 Canada Region... 169 7.4 POS Terminal Requirements... 170 7.6 ATM Terminal and PIN-based In-Branch Terminal Requirements... 170 Europe Region... 170 7.3 Contactless Payment Functionality... 170 7.4 POS Terminal Requirements... 171 7.6 ATM Terminal and PIN-based In-Branch Terminal Requirements... 174 7.7 Hybrid Terminal Requirements...175 Latin America and the Caribbean Region...176 7.4 POS Terminal Requirements... 176 Middle East/Africa Region... 177 7.3 Contactless Payment Functionality... 177 7.7 Hybrid Terminal Requirements...177 United States Region...177 7.4 POS Terminal Requirements... 177 7.6 ATM Terminal and PIN-based In-Branch Terminal Requirements... 178 7.7 Hybrid Terminal Requirements...178 Appendix A: Geographic Regions... 179 Asia/Pacific Region... 180 Canada Region... 181 Europe Region... 181 Single European Payments Area (SEPA)... 182 Latin America and the Caribbean Region...183 Middle East/Africa Region... 183 United States Region...184 Appendix B: Compliance Zones... 185 Compliance Zones...186 Appendix C: Transaction Identification Requirements... 191 Transaction Date... 192 Contactless Transactions...192 Contactless Transit Aggregated Transactions... 194 Contactless-only Transactions... 196 Transaction Processing Rules 21 January 2016 19

Contents Quick Payment Service Transactions...198 Payment Transactions...200 Electronic Commerce Transactions...201 Digital Secure Remote Payment Transactions... 202 Digital Secure Remote Payment Transactions Containing Chip Data... 202 Digital Secure Remote Payment Transactions Containing UCAF Data...204 Partial Shipments Following Digital Secure Remote Payment Transactions... 207 MasterCard Mobile Remote Payment Transactions...209 Appendix D: Cardholder-Activated Terminal (CAT) Transactions...211 CAT Transactions...212 CAT Level Requirements...213 Dual Capability for CAT 1 and CAT 2... 213 CAT Level 1: Automated Dispensing Machines (CAT 1)... 213 CAT Level 2: Self-Service Terminal (CAT 2)...214 CAT Level 3: Limited Amount Terminals (CAT 3)...215 CAT Level 4: In-Flight Commerce (IFC) Terminals (CAT 4)...216 CAT Level 6: Electronic Commerce Transactions (CAT 6)...218 CAT Level 7: Transponder Transactions (CAT 7)... 218 CAT Level 9: Mobile POS (MPOS) Acceptance Device Transactions (CAT 9)... 219 Appendix E: CVM Limit Amounts... 220 E.1 Overview...221 E.2 CVM Limit Amounts...221 Appendix F: Signage, Screen, and Receipt Text Display... 222 Screen and Receipt Text Standards...224 Models for ATM Access Fee Notification at ATM Terminals...224 Models for Standard Signage Notification of an ATM Access Fee... 225 Asia/Pacific Region...225 Canada Region...226 Europe Region...226 Latin America and the Caribbean Region... 228 Middle East/Africa Region...229 United States Region... 230 Models for Generic Terminal Signage Notification of an ATM Access Fee... 230 Asia/Pacific Region...230 Canada Region...232 Europe Region...232 Latin America and the Caribbean Region... 234 Middle East/Africa Region...235 Transaction Processing Rules 21 January 2016 20

Contents United States Region... 236 Models for Screen Display Notification of an ATM Access Fee... 236 Asia/Pacific Region...236 Canada Region...238 Europe Region...238 Latin America and the Caribbean Region... 240 Middle East/Africa Region...241 United States Region... 242 Model for an ATM Access Fee Transaction Receipt...243 Model Screens Offering POI Currency Conversion...243 Model Receipt for Withdrawal Completed with POI Currency Conversion...244 Appendix G: Best Practices... 245 Digital Goods Purchases... 245 Appendix H: Definitions...247 Transaction Processing Rules 21 January 2016 21

Connecting to the Interchange System and Authorization Routing Chapter 1 Connecting to the Interchange System and Authorization Routing The following Standards apply with regard to connecting to the Interchange System and Authorization routing. Where applicable, modifications by region and/or country are provided at the end of this chapter in the section titled, Variations and Additions by Region. 1.1 Connecting to the Interchange System...24 1.2 Authorization Routing MasterCard POS Transactions... 24 1.3 Authorization Routing Maestro POS, ATM Terminal, and PIN-based In-Branch Terminal Transactions...24 1.3.1 Routing Instructions and System Maintenance...25 1.3.2 Chip Transaction Routing...25 1.3.3 Domestic Transaction Routing...25 1.4 ATM Terminal Connection to the Interchange System...26 1.5 Gateway Processing... 26 1.6 POS Terminal Connection to the Interchange System...26 Variations and Additions by Region... 27 Asia/Pacific Region... 27 1.4 ATM Terminal Connection to the Interchange System... 27 1.6 POS Terminal Connection to the Interchange System... 27 Canada Region... 27 1.3 Authorization Routing Maestro POS, ATM Terminal, and PIN-based In-Branch Terminal Transactions... 27 1.3.3 Domestic Transaction Routing...27 1.4 ATM Terminal Connection to the Interchange System... 28 Europe Region... 28 1.3 Authorization Routing Maestro POS, ATM Terminal, and PIN-based In-Branch Terminal Transactions... 28 1.3.2 Chip Transaction Routing SEPA only... 28 1.4 ATM Terminal Connection to the Interchange System SEPA Only... 28 Latin America and the Caribbean Region... 28 1.4 ATM Terminal Connection to the Interchange System... 28 1.6 POS Terminal Connection to the Interchange System... 29 United States Region...29 1.1 Connecting to the Interchange System... 29 1.3 Authorization Routing Maestro POS, ATM Terminal, and PIN-based In-Branch Terminal Transactions... 29 Transaction Processing Rules 21 January 2016 22

Connecting to the Interchange System and Authorization Routing 1.3.1 Routing Instructions and System Maintenance... 29 1.3.3 Domestic Transaction Routing...30 1.4 ATM Terminal Connection to the Interchange System... 30 Additional U.S. Region and U.S. Territory Rules...30 1.3 Authorization Routing Maestro POS, ATM Terminal, and PIN-based In-Branch Terminal Transactions... 30 Transaction Processing Rules 21 January 2016 23

Connecting to the Interchange System and Authorization Routing 1.1 Connecting to the Interchange System 1.1 Connecting to the Interchange System A Customer must maintain the necessary equipment and procedures to process Transactions and to connect to the Interchange System, using a telecommunications circuit established by the Interchange System that is equipped with back-up service. Before processing Transactions and on an ongoing basis thereafter, the Customer must perform testing and obtain any necessary certifications of its equipment, procedures, and Interchange System connections as may be required by the Corporation to ensure compatibility with its technical specifications then in effect. Each Principal and Association must establish and maintain, at its own expense, a data processing facility that is capable of receiving, storing, processing, and communicating any Transaction sent to or received from the Interchange System, and may connect at least one data processing facility directly to the Interchange System. Such facility may be established and maintained by the Customer s parent, its wholly-owned subsidiary, or an entity that is wholly owned, directly or indirectly, by the Customer s parent, or with the prior written agreement of the Corporation, by the Customer s designated third party agent. NOTE: An addition to this Rule appears in the United States Region section at the end of this chapter. 1.2 Authorization Routing MasterCard POS Transactions On an ongoing basis, an Acquirer of MasterCard POS Transactions must recognize all active MasterCard bank identification numbers (BINs) for purposes of obtaining Transaction authorizations, and obtain such authorizations on behalf of each of its Merchants as the Standards require. If the Acquirer uses Account range files provided by the Corporation for this purpose, such files must be loaded and functioning on the Acquirer s host system and available to its Merchants for use within six calendar days from the date that each updated file is distributed. Upon receipt of an updated Account range file from the Corporation, an Acquirer must confirm via an acknowledgement file that it updated its host systems accordingly. Alternatively, the Acquirer may submit all authorization requests containing an Account number with a BIN in the 510000 to 559999 range to the Interchange System for routing to the Issuer. 1.3 Authorization Routing Maestro POS, ATM Terminal, and PINbased In-Branch Terminal Transactions An Acquirer of Maestro POS Transactions, ATM Transactions, and/or Manual Cash Disbursement Transactions occurring at PIN-based In-Branch Terminals may default route to the Interchange System any such Transaction not belonging to its proprietary network. The Interchange System determines whether or not the Transaction is being performed by a Cardholder. Transaction Processing Rules 21 January 2016 24

Connecting to the Interchange System and Authorization Routing 1.3 Authorization Routing Maestro POS, ATM Terminal, and PIN-based In-Branch Terminal Transactions An Acquirer that does not default route such Transactions to the Interchange System must recognize all active Account ranges that are included in the Corporation s Financial Institution Table (FIT) or MasterCard Parameter Extract (MPE) files and must follow the Issuer s routing instructions, if any, set forth in those files. The Acquirer must ensure that the files are loaded and functioning on its host systems and available to its Merchants, ATM Terminals, and PINbased In-Branch Terminals for use within six calendar days from the date that each updated file is distributed. Upon receipt of an updated file, the Acquirer must confirm to the Corporation via an acknowledgement file that it has updated its host systems accordingly. NOTE: Modifications to this Rule appear in the Additional U.S. Region and U.S. Territories section at the end of this chapter. 1.3.1 Routing Instructions and System Maintenance Each Customer or its Sponsor must: 1. Submit to the Corporation completed institution routing table (IRT) and institution definition file (IDF) input documents no later than five business days prior to the requested effective date of live processing via the Interchange System. 2. Notify the Corporation of any routing updates at least five business days before the effective date of the change. Expedited maintenance may be performed within two business days of such notice. 3. Notify the Corporation of any scheduled downtime at least 24 hours in advance. NOTE: A variation to this Rule appears in the United States Region section at the end of this chapter. 1.3.2 Chip Transaction Routing Any chip-based ATM Transaction or Maestro POS Transaction generated by a MasterCardbranded Application Identifier (AID) must be routed through the Interchange System, or as otherwise approved by the Corporation. NOTE: A variation to this Rule pertaining to SEPA appears in the Europe Region section at the end of this chapter. 1.3.3 Domestic Transaction Routing When a Card is used at an ATM Terminal or PIN-based In-Branch Terminal in the country in which such Card was issued and the only common brand appearing on both the Card and the ATM Terminal or PIN-based In-Branch Terminal is a Mark, the resulting Transaction: 1. Must be routed to the Interchange System; or 2. The Issuer of the Card must report and pay a Brand Fee for such Transaction. This provision does not apply with respect to a Transaction for which the Issuer and Acquirer is the same Customer (an on-us Transaction). Transaction Processing Rules 21 January 2016 25

Connecting to the Interchange System and Authorization Routing 1.4 ATM Terminal Connection to the Interchange System NOTE: Variations to this Rule appear in the Canada Region and United States Region sections at the end of this chapter. 1.4 ATM Terminal Connection to the Interchange System Except as otherwise provided in the Standards, each Customer that acquires any ATM transactions must at all times make available for connection to the Interchange System, and in particular, the MasterCard ATM Network, all of the eligible ATM Terminals established by that Customer (including its parents, subsidiaries, affiliates, and Sponsored entities) in the country in which the Customer is located and in every other country in which it has been Licensed to conduct ATM Transaction acquiring Activity. A Customer Licensed only to conduct ATM Transaction acquiring Activity must make at least 75 percent of the ATM Terminals it establishes available for connection to the Interchange System. NOTE: Modifications to this Rule appear in the Asia/Pacific Region, Canada Region, Europe Region, Latin America and the Caribbean Region, and United States Region sections at the end of this chapter. 1.5 Gateway Processing The Interchange System may be used for the routing of ATM transactions and settlement of funds pursuant to terms governing a card that does not bear the any of the Corporation s Marks if such card bears the mark of one of the following authorized Gateways: 1. PLUS System USA, Inc. 2. VISA USA, Inc. The Interchange System technical specifications applicable to ATM Transactions apply to Gateway Processing. Error and dispute resolution is supported within Gateway Processing to the extent provided in the Standards that govern the individual Transaction. When a Gateway Customer uses the MasterCard ATM Network for Gateway Processing, error and dispute resolution requests must be processed in accordance with the Chargeback Guide. The Principal that submits an ATM transaction to the MasterCard ATM Network for Gateway Processing is deemed to have consented to comply with all applicable Standards and to pay all applicable fees in connection with such transaction. 1.6 POS Terminal Connection to the Interchange System NOTE: Rules on this subject appear in the Asia/Pacific Region and Latin America and the Caribbean Region sections at the end of this chapter. Transaction Processing Rules 21 January 2016 26

Connecting to the Interchange System and Authorization Routing Variations and Additions by Region Variations and Additions by Region The remainder of this chapter provides modifications to the Standards set out in this chapter. The modifications are organized by region or country and by applicable subject title. Asia/Pacific Region The following modifications to the Rules apply in the Asia/Pacific Region or in a particular Region country or countries. Refer to Appendix A for the Asia/Pacific Region geographic listing. 1.4 ATM Terminal Connection to the Interchange System In the Asia/Pacific Region, the Rule on this subject is modified as follows. A Customer that acquires ATM Transactions must make available for connection to the Interchange System at least 75 percent of its eligible ATM Terminals in the Region within one year of the approval of its application for a License. 1.6 POS Terminal Connection to the Interchange System In the Asia/Pacific Region, a Customer that acquires POS Transactions must make available for connection to the Interchange System at least 75 percent of its eligible POS Terminals in the Region within one year of the approval of its application for a License. Canada Region The following modifications to the Rules apply in the Canada Region. Refer to Appendix A for the Canada Region geographic listing. 1.3 Authorization Routing Maestro POS, ATM Terminal, and PIN-based In-Branch Terminal Transactions 1.3.3 Domestic Transaction Routing In the Canada Region, the Rule on this subject is modified as follows. When a Card issued in the Canada Region is used at an ATM Terminal or PIN-based In-Branch Terminal located in the Canada Region and the only common brand appearing on both the Card and ATM Terminal or PIN-based In-Branch Terminal is a Mark: 1. The resulting Transaction must be routed to the Interchange System; or 2. The Issuer receiving such Transaction must report and pay a Brand Fee for such Transaction. This provision does not apply with respect to a Transaction for which the Issuer and Acquirer is the same Customer (an on-us Transaction) or any Transaction processed between: Transaction Processing Rules 21 January 2016 27

Connecting to the Interchange System and Authorization Routing Europe Region 1. A Principal (or its Third Party Processor) and one of its Affiliates (or its Third Party Processor), or 2. Two Affiliates (or their Third Party Processors) Sponsored by the same Principal. 1.4 ATM Terminal Connection to the Interchange System In the Canada Region, the Rule on this subject is modified as follows. A Customer that acquires ATM Transactions must make available for connection to the Interchange System at least 75 percent of the eligible ATM Terminals established by it (including its parents, subsidiaries and affiliates) in each major Canadian metropolitan area in which at least 10,000 of its debit Cardholders reside. The Census Metropolitan Area (CMA) as defined by the Canadian government will be used as the measure. Europe Region The following modifications to the Rules apply in the Europe Region or in a particular Region country or countries. Refer to Appendix A for the Europe Region and Single European Payments Area (SEPA) geographic listing. 1.3 Authorization Routing Maestro POS, ATM Terminal, and PIN-based In-Branch Terminal Transactions 1.3.2 Chip Transaction Routing SEPA only The Rule on this subject does not apply to Intra-SEPA Transactions. 1.4 ATM Terminal Connection to the Interchange System SEPA Only Within SEPA, the Rule on this subject is modified as follows. A Customer must at all times accept all MasterCard, Maestro, and Cirrus Cards at all ATM Terminals owned or established by that Customer (including its parents, subsidiaries, affiliates, and Sponsored entities) within SEPA if it accepts cards issued under other acceptance brands at those ATM Terminals. Latin America and the Caribbean Region The following modifications to the Rules apply in the Latin America and the Caribbean Region. Refer to Appendix A for the Latin America and the Caribbean Region geographic listing. 1.4 ATM Terminal Connection to the Interchange System In the Latin America and the Caribbean Region, the Rule on this subject is modified as follows. Transaction Processing Rules 21 January 2016 28