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A Card-On-File transaction (also called credential on file) is defined as a transaction initiated either by a cardholder or a merchant (or merchant’s system) using a Primary Account Number (PAN) previously stored, excluding those scenarios where credentials were are stored solely for single use onlythe purpose of completing a single transaction (i.e., storing PAN with transaction for the purpose of refund or storing PAN for the purpose of processing incremental charges on a hotel portfolio).
For example, below are 2 valid Card-On-File use cases:
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