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What is ARN (Acquirer Reference Number)?
An Acquirer Reference Number (ARN) is a distinct 23-digit number linked to online Visa and Mastercard debit and credit card transactions. It serves as a bridge between the merchant’s bank (acquiring bank) and the cardholder’s bank (issuing bank). The payment gateway generates the ARN number when a transaction is initiated, instilling confidence in online payments by enabling the tracing and verification of transactions throughout the payment flow.
ARNs are instrumental in preventing online payment fraud and unauthorised transactions by enhancing transparency. They provide buyers with a better online purchasing experience and the same level of assurance as offline transactions. The unique acquirer reference number allows for tracking and verifying transactions, revealing any errors or irregularities. This feature is particularly beneficial for refund payments, which can sometimes take time to process.
Structure of an ARN
The structure of an ARN number may vary slightly across different payment processors or networks. However, it typically consists of a 23-digit alphanumeric code. This code contains essential information about the transaction, such as the acquiring bank, issuing bank, and transaction details.
An ARN might look like this: 123456789012345678901234. The specific format and arrangement of the digits may differ depending on the payment processor or network involved in the transaction.
For instance, while one payment processor may use a purely numeric format, another might incorporate letters into their ARN structure. These variations are essential to consider as they can affect how transactions are tracked and verified across different platforms.
Real-World Examples and Use Cases of ARN
To better understand the practical applications of ARNs, let’s consider a couple of real-world examples:
1. Chargeback Dispute for a Failed Transaction:
Imagine a scenario where a customer’s online purchase fails due to a technical glitch, but their account is still debited. In such cases, the customer can raise a chargeback dispute with their issuing bank. The bank will then use the ARN number to investigate the transaction and communicate with the acquiring bank to resolve the issue and initiate a refund.
2. Tracking a Delayed Refund:
Sometimes, when a customer requests a refund for a product or service, the process may take longer than expected. By using the ARN code, both the customer and the merchant can track payments and inquire about the refund status with their respective banks. The ARN acts as a reference point, enabling all parties to monitor the refund process effectively.
How Does ARN Work in Payment Processing?
In the payment processing lifecycle, the ARN number plays a vital role in connecting the acquiring bank, issuing bank, and payment gateway. When a customer initiates an online transaction, the payment gateway generates a unique ARN. This number is then communicated to the acquiring bank, which sends an authorisation request to the issuing bank.
The issuing bank verifies the customer’s account details and approves or declines the transaction. If approved, the funds are transferred from the customer’s account to the merchant’s account through the acquiring bank. Throughout this process, the ARN acts as a reference point, allowing all parties involved to track payments and ensure the transaction’s integrity.
How to find and track an ARN number?
There are several ways to find and track an ARN number. Here are some common methods:
1. Accessing ARN from Bank SMS or Email:
When a transaction is processed, banks often send an SMS or email notification to the customer containing the transaction details, including the ARN. You can find the ARN in these communications and use it for reference.
2. Using Netbanking or Mobile Banking Apps:
Most banks provide online banking portals and mobile apps where customers can view their transaction history. By logging into these platforms, you can locate the ARN associated with a specific transaction.
3. Checking ARN in UPI or Payment Apps:
If you’ve made a transaction using a UPI (Unified Payments Interface) or a digital wallet app, you can usually find the ARN within the app’s transaction history or payment details section.
4. Contacting Customer Support:
In case you’re unable to locate the ARN through the above methods, you can reach out to the customer support of your bank or payment processor. They can assist you in finding the ARN based on the transaction details you provide.
5. Tracking ARN for Dispute Resolution:
If you’re facing a dispute or discrepancy in a transaction, you can use the ARN to track the status of the issue. By providing the ARN to your bank or payment processor, they can investigate the matter and provide you with updates on the resolution process.
Benefits of ARN for Merchants and Customers
1. Enhanced Customer Experience:
ARNs improve transparency and efficiency in the refund process. By allowing customers to easily track their refund status using the ARN, merchants can reduce frustration and unnecessary back-and-forth communication. This transparency ensures that customers receive their refunds promptly, enhancing their overall experience.
2. Fraud Reduction:
ARNs play a crucial role in mitigating online payment fraud. By enabling the tracking and identification of fraudulent transactions, ARNs empower merchants to take proactive measures. If a merchant faces a chargeback, they can submit the ARN code to the bank for investigation. This process helps validate the transaction’s legitimacy and prevents future fraudulent activities.
3. Increased Efficiency:
ARNs streamline transaction tracking and management, boosting operational efficiency for merchants. With the ability to easily identify and track payments using the ARN number, merchants can optimise their processes and handle a large volume of transactions seamlessly.
How to Apply for an ARN Number as a Merchant?
If you’re a merchant looking to obtain an ARN code for your business, you can follow these steps:
1. Offline Procedure:
- Visit a Computer Age Management Services Pvt. Ltd. (CAMS) office regulated by AMFI.
- Obtain the ARN application form.
- Fill out the form accurately and attach the required documents, such as:
- Copy of the NISM Certificate
- Copy of Aadhaar Card
- PAN Card Copy
- Proof of Bank Account
- 2 Passport-sized photographs
- Submit the completed form and documents for processing.
2. Online Procedure:
- Register online at the designated website: https://web.camsonline.com/AMFI/login.aspx
- Submit the ARN application form obtained from CAMS along with the Know Your Dealer (KYD) acknowledgement. If the KYD application is still in process, submit the KYD application form in person.
- Ensure all required documents are attached, and the designated application fee is paid. The fee for individuals and senior citizens is ₹3,540.
- Upon successful completion of the registration process, you will receive a confirmation email regarding the registration and photo identity card.
Frequently asked questions (FAQs):
1. Can an ARN number be used to track the status of a payment transaction?
Yes, an ARN number can be used to track the status of a payment transaction. By providing the ARN to the bank or merchant, customers can inquire about the transaction status, including pending payments, successful transactions, or refund progress.
2. How do I obtain an ARN number for a financial transaction?
An ARN number is automatically generated by the payment gateway when a transaction is initiated. Customers can obtain the ARN from various sources, such as bank SMS or email notifications, net banking portals, mobile banking apps, or payment app transaction histories.
3. How long does receiving an ARN number after initiating a transaction take?
The generation of an ARN number is usually instantaneous. As soon as the transaction is initiated, the payment gateway assigns a unique ARN to the transaction. Customers typically receive the ARN in real-time through SMS, email, or within their banking portal or payment app.
4. Is ARN the same as a transaction ID?
While an ARN number and a transaction ID both serve as unique identifiers for a transaction, they are not the same. ARN is specifically assigned by the acquiring bank to track transactions between the acquiring and issuing banks, while transaction ID is a broader term used by various payment systems to identify transactions internally.
5. What information does an ARN number typically include?
An ARN typically includes encoded details about the transaction, such as the acquiring bank, issuing bank, and other transaction specifics. The exact information may vary depending on the payment processor or network involved.
