---
title: "Merchant-initiated transactions (MIT)"
description: "PSD2 SCA compliance regarding authorization adjustments and payments for subscriptions and contracts."
url: "https://docs.adyen.com/online-payments/psd2-sca-compliance-and-implementation-guide/business-models/subsequent-payments"
source_url: "https://docs.adyen.com/online-payments/psd2-sca-compliance-and-implementation-guide/business-models/subsequent-payments.md"
canonical: "https://docs.adyen.com/online-payments/psd2-sca-compliance-and-implementation-guide/business-models/subsequent-payments"
last_modified: "2021-01-28T10:26:00+01:00"
language: "en"
---

# Merchant-initiated transactions (MIT)

PSD2 SCA compliance regarding authorization adjustments and payments for subscriptions and contracts.

[View source](/online-payments/psd2-sca-compliance-and-implementation-guide/business-models/subsequent-payments.md)

SCA is not required for an authorization adjustment or for subsequent payments related to a subscription or contract. However, the [initial authorization or the first transaction for the subscription or contract does require SCA](#next-steps).

## Requirements

Before you begin, take into account the following requirements:

| Requirement          | Description                                                                |
| -------------------- | -------------------------------------------------------------------------- |
| **Integration type** | An [online payments integration](/online-payments/build-your-integration). |

## MIT

Card schemes refer to payments initiated by merchants (instead of directly by shoppers) as merchant-initiated transactions or MIT. Payments made to adjust the initial transaction made by a shopper or subsequent payments in a subscription or contract fall under the scope of MIT.

To ensure that a transaction can be correctly classified as MIT, subsequent payments or authorization adjustments must be linked to the first payment using a network transaction reference.

### Authorization adjustments

The pre-authorization transaction requires SCA, but any transaction made to adjust the amount of the pre-authorized amount or to extend the validity of the initial payment is classified as MIT, exempting it from SCA compliance.

Adyen automatically sends the [additionalData.networkTxReference](https://docs.adyen.com/api-explorer/Checkout/latest/post/payments/details#responses-200-additionalData-ResponseAdditionalDataCommon-networkTxReference) when you adjust the pre-authorized amount or extend the validity of the authorization.

### Subscriptions and contracts with non-fixed time intervals

The first payment in a subscription or a contract falls under the SCA because the shopper initiates the transaction. This means that SCA is required on the sign-up for a series of **Subscription** or **UnscheduledCardOnFile** payments. All subsequent payments in a subscription or a contract are classified as MIT and do not fall under the scope of SCA compliance.

How the subsequent payments are linked to the first payment depends on how you tokenize card details.

### Tab: Tokenizing with Adyen

If you are tokenizing with Adyen, you do not have to store the network transaction reference. Adyen automatically stores and submits the `networkTxReference` for MIT transactions.

### Tab: Not tokenizing with Adyen

If you are not tokenizing cards with Adyen and are using your own or an external card vault, you'll need to handle storing and submitting the network transaction reference:

1. Store the value returned in [additionalData.networkTxReference](https://docs.adyen.com/api-explorer/Checkout/latest/post/payments/details#responses-200-additionalData-ResponseAdditionalDataCommon-networkTxReference) from the response of the first authenticated payment in a subscription or contract.
2. For the subsequent payments, submit the [additionalData.networkTxReference](https://docs.adyen.com/api-explorer/Checkout/latest/post/payments/details#responses-200-additionalData-ResponseAdditionalDataCommon-networkTxReference) in your request. Failing to do so can cause issuers to return soft declines.

Even though issuers [grandfather](https://en.wikipedia.org/wiki/Grandfather_clause) recurring contracts that predate the PSD2 mandate, we recommend that you send the `networkTxReference` from the initial transaction where the shopper signed up for a series of **Subscription** or **UnscheduledCardOnFile** payments.

Adyen no longer inserts card scheme-compliant static value on your behalf.

## Next steps

[![A puzzle piece](/online-payments/psd2-sca-compliance-and-implementation-guide/business-models/subsequent-payments/puzzle.svg)](/online-payments/psd2-sca-compliance-and-implementation-guide/sca-options)

###### [Implement SCA](/online-payments/psd2-sca-compliance-and-implementation-guide/sca-options)

[Your options to implement SCA.](/online-payments/psd2-sca-compliance-and-implementation-guide/sca-options)

[![A puzzle piece](/online-payments/psd2-sca-compliance-and-implementation-guide/business-models/subsequent-payments/puzzle.svg)](/online-payments/psd2-sca-compliance-and-implementation-guide/sca-exemptions)

###### [Possible SCA exemptions](/online-payments/psd2-sca-compliance-and-implementation-guide/sca-exemptions)

[SCA exemptions that you can request.](/online-payments/psd2-sca-compliance-and-implementation-guide/sca-exemptions)