Credit Card Processing Blog

Cardholder-activated terminals (CATs) are typically unattended terminals that accept bank cards for payment. These terminals are frequently installed at rail ticketing stations, gas stations, toll roads, parking garages, and other merchant locations.

There are four types of cardholder-activated terminals:

• Automated Dispensing Machines / Level 1.
• Self-Service Terminals Level 2.
• Limited Amount Terminals Level 3.
• In-flight Commerce (IFC) Terminals Level 4.

CAT requirements specify the maximum dollar amount of transactions permitted as well as authorization, clearing and chargeback requirements and related transaction liability for each CAT type.

Because CATs are typically unattended, traditional point-of-sale (POS) card acceptance procedures do not apply, such as verification of the card’s validity by examining its hologram, account number, expiration date and other security features for signs of tampering. For the same reason the merchant is also prevented from verifying the authenticity of the cardholder’s signature.

Merchants operating CATs need to ensure that payment processing procedures at their unattended terminals comply with the following general acceptance requirements:

1. All non-face-to-face transactions initiated by the cardholder where the card number is either captured as a result of reading the card electronically or by using an electronic device (such as a transponder, PC, or mobile phone) must include the proper cardholder-activated terminal (CAT) level indicator in both the authorization message and clearing records. Depending on the CAT level indicator, other specific data is required for authorization and clearing.
   1. The authorization request message must include a valid merchant category code, point-of-sale (POS) country code, POS postal code, and CAT level indicator (Level 1, 2, 3, 4, 6, or 7).
   2. Messages used at the CAT must communicate to the cardholder, at a minimum, the following information:
      • Invalid transaction.
      • Unable to route.
      • Invalid PIN-re-enter (Level 1 only).
      • Capture card (subject to the terminal’s ability to retain cards).
   3. The merchant identification number and the CAT level indicator must be present in the First Presentment, First Chargeback, Second Presentment, and Arbitration Chargeback messages.
2. The description of products or services on the CAT sales receipt should be clearly recognizable to the cardholder.
3. Processing banks are responsible for providing requested transaction information documents.
4. No CAT may accept a bank card for the purchase of scrip.
5. The transaction receipts provided to cardholders should show only the last four digits of the primary account number, and that all preceding digits are truncated. The truncated digits must be replaced with fill characters such as “X,” “*,” or “#” and not with blank spaces or numeric characters.

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