MasterCard: 20% Tip Tolerance for Card-not-present Restaurants

In 2017, MasterCard reinstated the use of the 20% tip tolerance to card-not-present (CNP) transactions conducted by U.S. restaurant merchants that have the following Merchant Category Codes (MCCs):
 

• MCC 5812 (Eating Places, Restaurants)
• MCC 5814 (Fast Food Restaurants)

The use of the 20% tip tolerance enables a restaurant merchant to add a tip amount after the authorization was approved. The tip amount must be within 20% of the authorization amount. The portion of the tip amount that exceeds the 20% tolerance may be charged back by the issuer for no authorization.

See the following restaurant CNP use cases:

• A guest ordered sushi over the phone and picked up the order from the restaurant. the guest wants to leave a tip - the receipt prints with a tip line, and the guest adds a tip and signs the receipt.
• A guest ordered pizza from the merchant's website or via an app on a mobile device. After the pizza is delivered, the driver produces a receipt for the guest, who adds a tip and signs the receipt.