We transitioned to Adyen in July 2023, and have been disappointed with the company thus far. In addition to sub-par reporting, Adyen imposes significant limitations on refund capabilities, with a cap of $5000, unless you pre-fund the amounts to your Adyen account. This cumbersome workaround process undermines the core benefits of engaging a merchant services provider.
This limitation highlights a critical need for adaptability managing refunds, particularly in light of the challenges posed by performance cancellations and other unpredictable circumstances. If we need to cancel an event due to weather or other unforeseen circumstances, we cannot wait 2-3 days to begin processing refunds because Adyen won't allow it unless the full amount is in our Adyen account. I am so grateful Adyen was not our processor during 2020 or 2021 because it would have been untenable. The lack of flexibility in Adyen's current setup prompts a reassessment of our approach to merchant services. Tessitura is aware of the issue and the challenges with Adyen. If you haven't made the switch to Tessitura Merchant Services, I would strongly recommend that you pause until the issues are addressed with the payment processor. Moreover, should there be an absence of significant improvement in service adaptability and responsiveness from Adyen, it would be prudent for Tessitura to reconsider its requirement that all organizations make the shift to Adyen. Allowing organizations the autonomy to select their merchant services provider would enable the selection of entities that are not only more aligned with their operational needs but also adhere to industry best practices.
Thanks Heather for bringing up this topic. First a small clarification: as others point out here, it isn't a fixed amount of $5,000 available for refunds but rather a $5,000 automatic float which allows you to refund that amount plus whatever income is processed on an individual day. Obviously as you point out this can impact situations where there are sudden performance cancellations, but over the two years we have only seen this impact day to day processing in two or three instances, one of which was obviously your situation. As you said, we are aware of the issue and are working on a longer term solution with Adyen to make this process smoother.
Hi Chuck,
Perhaps there's documentation I should be going to for this, but I have some questions about refunds with TMS.
First, though, I should state that we have to refund a bare minimum of one event every year, whether it's Visa issues, artist illness, forest fires, whatever. We've done two this year, and were very happy to have the Event Cancellation Utility to do it with. I'd be surprised to discover that this is somehow bad luck that only happens to us.
My first question is about how the available funds are calculated. If I attempt to enter a $10,000 gift, get an error, attempt a second time and succeed, then go to the customer record and see two contributions, presumably I can safely back the first out and refund it because that $10,000 is still in available funds? You say "on an individual day", so I would have until midnight(?) to detect my mistake (say I have to send a query to Finance to see if there was double charge) and refund without having to worry about adding to my reserve?
Second question: I have to refund an event, so I know I have to put money into my reserve. I don't know how many tickets I will be able to successfully refund ahead of time, so I'll have to manually transfer the entire ticketing income plus fee income from orders on that event to Adyen. How long does that transfer take? Then I'll run the Event Cancellation Utility, and record the amount successfully refunded. Now I subtract that amount from the amount I originally deposited and reclaim that from Adyen. I can do that right? Is that the expected process?
Third question: I suppose you could consider this our problem to deal with, though I'd expect it to impact anyone doing this, how am I squaring these financial transactions for my records? I have a mass transfer out of my organization, then I'm recording the automated refunds also as transfers out of my organization, then I'm transferring some of that money back into my organization, then I'm doing the other refunds, presumably by check, also registered as transfers out of my organization.
Fourth question: currently when running the Event Cancellation Utility, tickets that were moved to a different order, or purchases on cards that have since been cancelled fail. We collect those and either apply them to a card on account (if we can see which card was used in the original order) or contact to customer to choose a card on account or give us a card to apply the refund to. Am I correct that we fundamentally cannot do this step with TMS?
Again, if there's documentation that answers all of these questions, please forgive me and point me to it.
Thanks,
Gawain
Hi all,
Let me try to answer this.
The funds available for refund at any given point in time is the sum of four amounts.
So in your first question, yes $10,000 would be available for your contribution refund. If the sum of the four amounts is greater than the refund request at the time of authorization, the refund will go through.
Second question: A manual bank transfer typically takes two days. I don't understand the part about reclaiming this from Adyen--the funds you deposit in your reserve account will be spent down for the refunds. If the question is "what if I transfer too much into reserves; how do I get that back?" I will have to do a bit of research on that. As I said, so far we have only worked with a few manual transfers for refunds in the whole time we've been working with Merchant Services.
Third question: I'm think I'm going to agree with you that this is an accounting issue on your side.
Fourth question: With Merchant Services in the case you describe, if a customers gives you a card number to refund to (you don't already have the card on account), you are able to do that through a terminal.
Thanks!
Chuck Reif, thanks for that breakdown. That is extremely helpful as we get ready to move to TMS ourselves. But, and I think Gawain Lavers is hinting around this, but let me ask this question then.
Hypothetical Situation: (numbers have been simplified for the ease of mental math and forum questions)
Let us say we are notified that our performances by John Smith need to be cancelled and completely refunded because he fell down the stairs and broke both his legs. Now, we want to get a jump on this because communication is key. We know we do, on average, $25,000 in ticket sales per day, so would have approximately $25,000 in your #2 line. We got the notice about the cancellation at 10:00 AM, just as we opened, so we know that we have taken in only about $5,000 thus far in online sales from your #1 line. We predetermined that we wanted $50,000 in reserve with TMS, so that is sitting there in your #3 line. And, we have an additional $5,000 (+ $400) in your #4 line.
Thus, in total, we have $85,000 available for refunds ($50,000 + $25,000 + $5,000 + $5,000). If that is incorrect, please let me know where I made my mistake.
But, John Smith happened to be a BIG seller for us, and his booking took in a total of $150,000. Now, we always have outstanding issues that need to be delayed, which will probably result in about $25,000 worth of tickets that are not going to be refunded that day. But the other $125,000, we would like refunded.
Question: I think the question is, how should we bridge THAT gap? Can we do a quick transfer to TMS/Adyen of an additional $40,000 to make up the gap between $85,000 and $125,000? Or are we stuck at $85,000 that day? And then how quickly can we put the additional $40,000 into action? What about replenishing the initial $50,000 we had in reserve?
Just trying to make sure I know exactly how this works so as to best advise my staff. On the whole, assuming I understand things correctly as you describe, I am NOT worried at all about our organization running into too many issues here. But, in the vein of the Boy Scouts, I like to be prepared.
John A. Moskal II
Some additional information on question #2. In the case where a member wants to reclaim extra funds that may be have been added to the reserve account but not used, it is possible for Tessitura Payment Support to set the reserve amount to 0 (or some other value) which will result in the overage being added to the next payout.
Chuck Reif said:I don't understand the part about reclaiming this from Adyen--the funds you deposit in your reserve account will be spent down for the refunds.
We don't know how many payments we will be able to refund by reference until after we have run the Event Cancellation Utility. The failures from that utility then have to be addressed manually. Some of that might be doing a direct refund (although it sounds like that's not going to be as broadly possible with TMS as it is with Windcave) which would also potentially draw down from the reserve, but then the rest of it would have to be cut checks, so we would then need that money back from Adyen to direct to campus finance.