An Overview of the TeleCheck's Transaction Evaluation Process
What is the transaction evaluation process?
The process is an automated tool for evaluating both transactional and individual risk related to check activity.
Is this type of evaluation a new concept?
No. Companies have been using this type of evaluation method for more than 40 years to process consumer loans, credit
card applications and tax returns.
How is the evaluation process developed?
Using the historical data from literally millions of check transactions, TeleCheck selected a unique set of characteristics
to use when determining check risk. Using these unique characteristics and statistical analysis, decision algorithms
were developed to predict which transactions could be considered good check risks.
Is the decision to authorize my check made by a machine?
Yes, computers are used to process the information through the statistical models. Our ability to handle transactions
in this way makes the decision process fast and enhance accuracy.
How does the evaluation process work?
Check transactions processed by TeleCheck are stored in positive and negative databases. Through in-depth analysis
of these databases, TeleCheck is able to conclude which factors are predictive of returned check risk. These factors
along with the check amount and check writer’s history in TeleCheck’s positive or negative database are then considered
during the authorization process. The system weighs the information to determine an up-to-date evaluation. The results
of this evaluation process help determine whether a check transaction will be authorized.
How valid is the evaluation process?
In order for an evaluation process to be statistically valid it must be based on current information and include
a large enough number of transactions. TeleCheck’s evaluation process is built using data from millions of recent check
transactions that have come to us from over 220,000 merchant customers. TeleCheck continuously monitors these systems
to ensure consistent, impartial and statistically valid results.
Will TeleCheck provide details of a transaction evaluation?
Unfortunately, the details of the evaluation process are confidential. TeleCheck does not provide this information
in its entirety because doing so would hinder our systems effectiveness and security. Our ability to safeguard this information
is key to preserving checks as a payment option at the point of sale.
If TeleCheck declines to process my Internet check transaction, does this mean that the merchant will not accept
my check?
Not necessarily. Even if TeleCheck declines to process your check transaction over the Internet, the merchant may
be willing to accept a paper check sent by mail. For more information, check the merchant’s Web site or contact the merchant
directly.
