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Merchant Service Terms – ReD fraud management

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  1. Introduction
  2. Duration
  3. The ReD service
  4. Service fees
  5. Disclaimer & limitation of liability
  6. Provisions imposed by our licensor
  7. Termination

    1. By using or subscribing to PayU’s Red Fraud Management Service (“the RED Service”), you agree that you have read, understand and are bound by:
      1. the Merchant Service Terms- Red Fraud Management as set out herein (“Service Terms”);
      2. the Merchant Service Terms – General (“General Terms”);
      3. the provisions of the relevant hardcopy or electronic application form relevant to The RED Service (“Application Form”);and
      4. any notices which may be published under “Notices” on the Website from time to time.
    2. Your use of the RED Service indicates your acceptance without modification of these Service Terms, as read with the General Terms and the Application Form, which will together constitute a legal agreement (“the Agreement”) between you and PayU.
    3. Unless the context clearly indicates the contrary, any term defined in the General Terms when used herein, shall bear the same meaning as defined in the General Terms. In this regard note that, because the RED Service enables you to run to a fraud check on payments made to you online, you are a ‘Merchant’ for purposes of this Agreement. To the extent that there is any inconsistency between any provision of the General Terms and these Service Terms, then these Service Terms shall override the General Terms to the extent of the inconsistency.

    1. This Agreement shall commence with effect from the date of activation of the RED Service by PayU which date shall not be earlier than the requested commencement date set out in your Application Form and shall endure until either of us terminates it in accordance with the General Terms.


    1. The RED Service involves the running of a fraud check on a transaction during payment processing or thereafter. The RED Service will use certain fraud risk indicators (or “Rules”) to identify possible fraud, yielding a basic response to you to either ‘approve’ or ‘deny’ and sometimes to ‘challenge’ the transaction (the so-called ”Result”). The specific Rules used to conduct such fraud check, the type of Results you will get, the extent to which you will receive information and reports related thereto, whether PayU will conduct further investigations for you in respect of ‘challenged’ transactions or whether you will be able to do so yourself, will depend on the specific Service package you select in your Application Form. More specifically we provide the following packages:

      1. Basic Package: On the ‘Basic’ package, PayU’s standard Rules are used to conduct the fraud check and the Result is limited to ‘approve’ or ‘deny’. Access to ReD portal is not included.
      2. Basic Custom Package: On the ‘Basic (Custom)’ package, Merchant is able to customize the Rules to be used in conducting the fraud checks. Results are limited to ‘approve’ or ‘deny’. Access to the ReD portal is included in order to view transaction details.
      3. Classic Package: On the ‘Classic’ package, PayU’s standard Rules will be used to conduct the fraud check. The Result will be either ‘approve’, ‘deny’ or ‘challenge’, and in the event of a ‘challenge’ Result, PayU will then conduct further investigation and analysis required in relation to that transaction and report back to the Merchant system to accept or deny the transaction on behalf of the Merchant. Access to the ReD portal is not included.
      4. Classic Custom Package: On the ‘Classic (Custom)’ package, Merchant is able to customize the Rules to be used in conducting the fraud checks. The Result will be either ‘approve’, ‘deny’ or ‘challenge’; and in the event of a ‘challenge’ Result, the Merchant will have access to the ReD Portal (via its own login and password) in order to conduct further investigation on the challenged transaction to either accept or deny the transaction.
      5. Pro Package: On the ‘Pro’ package, Merchant is able to customize the Rules to be used in conducting the fraud checks. The Result will be either ‘approve’, ‘deny’ or ‘challenge’, and in the event of a ‘challenge’ Result, PayU will then conduct further investigation and analysis required in relation to that transaction and report back to Merchant’s system. Access to the ReD portal is included in order to view transaction details.
      6. Bespoke Package: A ‘Bespoke Customer’ package can be put together for enterprise-class Merchants where risk assessment includes management configuration, extensive data analysis and the formulation of complex/Reseller End User specific risk management strategies designed to achieve specific reseller/End User metrics. Set up includes technical integration, field mapping, testing and certification.
    2. You acknowledge and agree that PayU may monitor and record communications to PayU regarding the use of the RED Service for the purposes of customer quality and assurance.
    3. You acknowledge the nature of the RED Service and accordingly agree that the operation of the RED Service, and the specific package selected by you, is known to you and accept that it is suitable for the purpose it is intended to be used.

    1. The RED Service Fees applicable to the RED Service will depend on the exact Service Package you have selected in your Application Form and could include a fixed monthly fee, together with transaction based fees. The RED Service Fees are as specified in the Application Form.
    2. Payment: The manner in which your Service Fees are paid, depends on whether you have subscribed to our ‘EasyMerchant’ Service or not.

      1. If you are subscribed to the EasyMerchant Service: Transaction-based Service Fees are due upon the completion of each fraud check done on a transaction and will be deducted from the funds we hold for you under the EasyMerchant Service, provided that in the event that any such funds held by PayU on your behalf are insufficient for the deduction of any applicable Service Fees, you remain liable for such Service Fees and will be invoiced therefor in arrears.
      2. If you are not subscribed to our EasyMerchant Service:

        1. To the extent that you require PayU to debit the RED Service Fees on a periodic basis, you hereby authorise PayU to effect the necessary transfers from your designated bank account at the beginning of each and every period so agreed for the continued duration of the RED Service.
        2. To the extent that you elect to be invoiced rather than utilise the debit order mechanism described above, PayU will invoice you in advance in respect of the relevant Service Fee/s so payable and you shall be obliged to pay such Service Fees on the payment date specified in the invoice.

    1. You acknowledge that: (i) any transaction executed through use of the RED Service creates legal rights and obligations only between you and the Payer and PayU shall never be a party to such transaction; (ii) irrespective of the use of the RED Service, PayU assumes no responsibility or liability for any fraud which may be committed save where PayU has been negligent or in breach of its obligations hereunder.
    2. Without limiting the generality of the aforegoing and the limitations of liability set out in the General Terms, PayU’s disclaimer of liability includes its liability for any loss or damages incurred by you or third parties arising from any transaction executed, or credit card payment made which was checked by the RED Service, save where due to PayU’s negligence.

    1. You hereby acknowledge that the Software contains copyrighted and proprietary materials licensed from Retail Decisions SA (Pty) Ltd (“ReD”). ReD is an intended third party beneficiary of the provisions of this clause 6 and will have the same right to enforce such provisions against you as we do.
    2. IP: You undertake to use the RED Service solely for your own purposes and shall not, directly or indirectly, lease, timeshare, rent, sell or otherwise provide any third party with the benefit of any aspect of the RED Service except as specifically permitted herein. You may not create derivative or collective works of the Software. You acknowledge and agree that the RED Service and all intellectual property rights in the Software used to provide the RED Service are and will remain the sole and exclusive property of Payu, ReD or their licensors. On termination of this Agreement, you shall cease using the RED Service and provide written certification that you have destroyed all copies of the documentation you may have or control
    3. Confidentiality: You acknowledge that you may obtain Software and other information relating to the RED Service or to ReD which is confidential and proprietary to ReD (“Proprietary Information”). Such Proprietary Information may include, but is not limited to, trade secrets, know how, inventions, techniques, processes, programs, schematics, software source documents, and data. You will at all times, including following termination of this Agreement, keep all such Proprietary Information in confidence and will not disclose or use such Proprietary Information other than as expressly authorized under this Agreement, nor will you disclose the Proprietary Information to third parties without prior written consent. You further agree to immediately return to PayU or destroy and confirm in writing that you have destroyed all Proprietary Information (including copies thereof) in your possession, custody or control upon termination of this Agreement at any time and for any reason. The obligations of confidentiality in this clause will not apply to the extent that information (i) has entered the public domain through no fault of your own; (ii) prior to disclosure was already rightfully in your possession; (iii) subsequent to disclosure is obtained by you on a non-confidential basis from a third party who has the right to disclose such information; (iv) is subsequently or independently developed by employees, consultants or agents of yours without reference to the Proprietary Information disclosed hereunder; or (v) is required to be disclosed by law or any regulatory authority with jurisdiction or pursuant to a court order, so long as (if this is reasonable in the circumstances) you give PayU adequate notice and the ability to challenge or limit such disclosure at PayU’s cost. You will not make any announcement, provide any press release, use PayU’s trademarks or otherwise disclose any information to the press or other media concerning the RED Service, Software or the terms of this clause without the prior written approval of PayU, which approval may not be unreasonably withheld except for any release necessitated by the rules of any stock exchange or any other regulatory authority with jurisdiction.
    4. Indemnity: ReD indemnifies you and your respective directors, officers, employees and agents (“Indemnitees”) from and against any claims of third parties and any actual costs or loss incurred (save to the extent incurred unreasonably) to the extent arising out or related to (i) ReD’s gross negligence, wilful misconduct or fraud; or (ii) an allegation that the RED Service or Software provided by ReD infringes any intellectual property right of a third party; or (iii) any failure to comply with the CPA; provided, however, ReD will have no obligation for any claim to the extent it is based on any (a) modifications by persons or entities other than ReD; (b) combinations, on a software/technical basis, with other services, products, processes or materials not supplied by ReD; (c) ReD’s compliance with PayU’s or your direction to modify the Software or the RED Service; (d) continued use after ReD has made available a non-infringing replacement for the RED Service or the Software as applicable; or (e) Software provided by a party other than ReD. For the avoidance of doubt, ReD agrees not to avoid or attempt to avoid granting indemnification if the infringement claim does not clearly identify which, as between PayU’s services and ReD’s services, is the subject of the allegation of infringement and agrees to cooperate with PayU and you to provide any information to defend against the claim and assistance including financial assistance in equal shares with PayU until such time as the basis of the infringement claim becomes clear and ReD’s services are not the subject of the infringement claim. Should ReD’s services be the subject of the infringement claim, PayU would expect to turn over the claim to ReD at that juncture. If any claim that ReD is obligated to defend occurs or in ReD’s opinion is likely to occur, ReD may, at its option, immediately either (1) obtain for PayU and you the right to continue to use the applicable service or Software; (2) replace or modify the RED Service or Software, as applicable, so they become non-infringing while retaining the full functionality of the RED Service or Software; or (3) terminate its main licence agreement with PayU with respect to that service or Software and pay direct damages suffered by PayU in regard thereto; all without prejudice to PayU’s rights including the right to claim damages. THE FOREGOING STATES THE ENTIRE LIABILITY OF ReD TO PAYU OR YOU, WHETHER FOR DAMAGES OR OTHERWISE, FOR CLAIMS OF INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHT WITH RESPECT TO ANY SERVICE OR SOFTWARE PROVIDED BY ReD HEREUNDER.
    5. Disclaimer: Subject to the terms of 6.4 above, ReD disclaims any warranty of any kind directly to you, including warranties of title, performance, merchantability, fitness for a particular purpose and non-infringement, to the maximum extent permitted by law. ReD’s liability is further limited as provided in 6.4 above, to the maximum extent permitted by law.
    6. Cardholder data: Subject to applicable law and any rights you may have under the CPA, you hereby acknowledge and agree as follows:

      1. Neither PayU nor ReD guarantees the security of the RED Service or any Cardholder Data, and will not be responsible in the event of any infiltration of their or your security systems, provided that neither of them are in breach of their obligations and they have used their respective best endeavours (using at least best practice in the industry) to prevent any such infiltration. Neither PayU nor ReD is responsible for the security of cardholder data or any other information stored on your servers or any other third party’s servers (other than their subcontractors’ servers).
      2. Neither PayU nor ReD is a party to any transaction between you and a cardholder and assumes no liability with respect to amounts due and owing for any such transaction.
      3. ReD is not a party to this Agreement and it shall only receive your cardholder data from PayU, not directly from you. As such, ReD shall not be liable for any actions or inactions of PayU and/or you which would cause the cardholder data not to be transmitted and received by ReD correctly.
    7. Your systems: You shall maintain properly functioning systems and circuits to use the current release or prior release of the Software, it being understood that a properly functioning interface is requisite for the integrity of the RED Service. You shall also upgrade your systems to a new release within one (1) year of such release’s publication.
    8. Compliance with Laws: You shall comply with all applicable data protection laws, consumer and other applicable laws and regulations with respect to your (i) provision, use and disclosure of cardholder data and confidential information; (ii) dealings with the Cardholders providing Cardholder Data; and (iii) use of the RED Services.
    9. You are not entitled to assign your rights or obligations under this clause 6 to any third party.

    The RED Service may be terminated as follows:

    1. By PayU, forthwith on written notice at any time, should its main license with ReD for the RED Service terminate for any reason;
    2. By you at any time after the Initial Period on 30 days’ prior written notice to PayU,
    3. By either of us (“terminator”) if the other of us (a) has committed a breach of a material provision of this Agreement and fails to remedy such breach within 30 days of receipt of written notice to do so; or (b) ceases to carry on business, becomes the object of institution of voluntary or involuntary proceedings in bankruptcy or liquidation, or a receive is appointed over a substantial part of its assets and such appointment will not be terminated and discharged within 30 days; (c) sends data that corrupts or jeopardizes the terminator’s computer systems which is not capable of immediate remedy at its expense or where any card association or other governmental agency decision requires such suspension; (d) attempts any unauthorised access to the terminator’s systems, causes any security breach relating to the terminator’s systems or (e) is reasonably suspected by the terminator for engaging in fraudulent or unlawful activity.