We place stop payments on recurring debit card transactions if notified by our customer within 3 business days. We are able to stop them ONLY if the charge had posted previously. I understand Reg E to say, we must stop all recurring charges if requested and if we do not have the capability to stop, we must get an outside vendor.

My question is: how do we know it is recurring if that charge never took place before. Are we required to stop these? Also what do you do in the instance if the charge never clears the account. I hate to get an outside vendor if we are misinterpreting. Please help!

I would get with your card processing vendor. Likely they have a solution for you at a minimal cost. The vendor should be able to explain and answer your questions. For ours- we are actually choosing whether R01 or R02.

Thanks for responding deed305. Is R01 and R02 recurring transaction codes through VISA or MasterCard?

I can only speak to Visa as we're not a MasterCard User- but yes- the Visa system- PPCS- Preauthorized Payment Cancellation Service does give you the option to choose R01 or R02- just like in the ACH world.

As for knowing if it's coded by the merchant as recurring- in Visa's system, there is an R for recurring that you can see in VROL. If you are with a processor that you don't use VROL- then your processor's system to view transaction detail should have the code in there somewhere for you to see. In addition, our core system is picking up the R for recurring code and we can see it in our core system, too.