Debit Card Credits - Venmo/Cash App/Facebook

Posted By: Brightside3277

Debit Card Credits - Venmo/Cash App/Facebook - 10/05/21 05:48 PM

Any input from other Bankers would greatly be appreciated. There have been an influx of debit card credits from Venmo/CashApp/Facebook that are memo posting immediately to our customer accounts (even though there is a different effective date), and then aren't settled until 2-3 business days after. Customer comes in and gets the money the same day the money is posted, the transaction never settles for whatever reason, and we are left with a loss. What are other financial institutions doing to help mitigate this risk? Do you not give immediate credit on any memo posted debit card credits? Is this something we have to work through the dispute process?
Posted By: HappyGilmore

Re: Debit Card Credits - Venmo/Cash App/Facebook - 10/05/21 06:57 PM

Quote
hat are memo posting immediately to our customer accounts (even though there is a different effective date), and then aren't settled until 2-3 business days after. Customer comes in and gets the money the same day the money is posted, the transaction never settles for whatever reason, and we are left with a loss.

your bank allows your customers to withdraw memo posted funds as good funds? your bank controls that process. stop allowing your customers to have access to memo posted transactions. only allow access to hard posted/settled funds. problem solved.
Posted By: HappyGilmore

Re: Debit Card Credits - Venmo/Cash App/Facebook - 10/05/21 07:00 PM

Originally Posted by HappyGilmore
Quote
hat are memo posting immediately to our customer accounts (even though there is a different effective date), and then aren't settled until 2-3 business days after. Customer comes in and gets the money the same day the money is posted, the transaction never settles for whatever reason, and we are left with a loss.

your bank allows your customers to withdraw memo posted funds as good funds? your bank controls that process. stop allowing your customers to have access to memo posted transactions. only allow access to hard posted/settled funds. problem solved.

edited - ooh, i realize that sounds much harsher than i intended when i wrote it. no judgement intended, just a simple perspective
Posted By: rlcarey

Re: Debit Card Credits - Venmo/Cash App/Facebook - 10/05/21 07:51 PM

No judgement intended either - but I agree.
Posted By: John Burnett

Re: Debit Card Credits - Venmo/Cash App/Facebook - 10/05/21 09:02 PM

Is your institution also allowing early access to ACH direct deposits like SSA, VA, payroll, etc.? I know a number of institutions have started doing that (Capital One is heavily advertising it). It's a management decision, and if you're getting those Venmo, CashApp and FB credits via ACH, you are accepting more risk for them (because there MAY be a greater risk of not having them funded).
Posted By: John Burnett

Re: Debit Card Credits - Venmo/Cash App/Facebook - 10/06/21 02:52 PM

If you are getting Venmo, CashApp and FB credits via the ACH, I question how they could not be funded. The ODFIs for those transactions have to settle for them. Even third-party senders have to be accountable for the credits they send via ACH.
Posted By: RR Sarah

Re: Debit Card Credits - Venmo/Cash App/Facebook - 10/07/21 05:21 PM

I believe they said the credits were coming through as debit card transactions. Are they showing as pre-authorizations?