Chaining of CIT/MIT transactions
The second Payment Services Directive (PSD2) requires cardholder authentication for any e-commerce transaction initiated by the cardholder.
CIT (Customer Initiated Transaction) : Buyer-initiated transaction with buyer interaction.
Example: Payment or card registration requiring data entry.
MIT (Merchant Initiated Transaction) : Transaction initiated by the merchant, without the presence of the buyer, linked to an CIT transaction.
Example: Installment of an payment in installments.
Operation chaining:
For a CIT transaction, regulations require cardholder authentication. After the request for authorization or information, the issuer returns a unique identifier, called the “chaining reference”. This reference is used in the MIT transactions to inform the issuer that the transaction is part of a series of payments, for which the cardholder authenticated in the first payment.
Without this reference, the issuer can decline an MIT transaction due to lack of authentication (soft decline).