Payment Card Direct Debit Authorisation

The Hong Kong Monetary Authority (HKMA) outlines expectations for Card Issuing Banks and Merchant Acquiring Banks regarding payment card direct debit authorizations (DDA) when merchants suspend or close their businesses. Consumer protection is the primary focus, with specific guidelines for banks to assist cardholders. Card Issuing Banks must ensure effective communication, provide timely responses to inquiries, offer assistance with DDA cancellations, and, when necessary, contact the merchant’s acquiring bank for reimbursement. Additionally, banks are encouraged to prepare resources for handling increased queries and to train staff in assisting cardholders. Merchant Acquiring Banks, on the other hand, should promptly cease collecting DDA payments from merchants whose businesses are suspended or closed to prevent further payments.

Resources: https://www.hkma.gov.hk/media/eng/doc/key-information/guidelines-and-circular/2024/20241105e1.pdf