Reason

The cardholder is claiming that they did not authorize or participate in a transaction that you processed.

Typical causes

• The cardholder has a chip card and someone has made a counterfeit copy of it.
• They made a transaction with a counterfeit card at a non-EMV terminal instead of using a chip reader that can detect fraud.

Prevention steps

• Use only EMV-compatible terminals.
• Always use the proper method of cardholder verification, such as signature, PIN, or other.
• Create an electronic or manual imprint for each transaction, where the cards present.

Reason

The cardholder is claiming that they did not authorize or participate in a transaction that you processed.

Typical causes

The cardholder has a PIN-preferring chip card, but the merchant did not use a chip-reading device to process the transaction or used a chip-reading device that was not PIN compliant.

Prevention steps

• Upgrade to EMV PIN-compliant terminals.
• Always obtain the appropriate Cardholder Verification Method (CVM).
• Take an imprint (either electronic or manual) for every card-present transaction.
• Train staff on the proper handling of terminal issues.

Reason

The cardholder is claiming that they did not authorize or participate in a key-entered or unattended transaction conducted in a card-present environment.

Typical causes

• The merchant did not ensure that the card was either swiped or that the chip was read.
• The merchant did not obtain manual card imprint on a key-entered transaction or a card-not-present transaction was not identified as such.

Prevention steps

• Upgrade to compliant terminals.
• Make sure all card-present transactions are either chip-read or magnetic stripe-read.
• Obtain an imprint or perform additional validation, such as PIN.

Reason

The cardholder did not authorize or participate in a transaction conducted in a card-not-present environment, such as internet, mail-order, phone-order, and others.

Typical causes

• An unauthorized (fraudulent) claim was processed using an invalid or stolen account number.
• The cardholder believes the transaction to be fraudulent due to an unclear or confusing merchant descriptor.

Prevention steps

• Consider using all the tools available, including Visa Secure, card security code (CVV2), and Address Verification Service (AVS).
• Use pre-sale fraud detection service providers that can help verify the cardholder’s identity, detect potential criminal activity, and reduce the risk of accepting unauthorized transaction.
• Use a billing descriptor that is easily recognized by the cardholder.
• Always submit an authorization request, no matter the transaction amount.
• Make sure you differentiate between card-not-present and card-present transactions during clearing by noting internet, phone, or mail orders.

Reason

Visa notified the cardholder’s bank that the Visa Fraud Monitoring Program (VFMP) identified the transaction and the cardholder’s bank has not successfully disputed the transaction under another dispute condition.

Typical causes

For merchants in the Visa Fraud Monitoring Program only, Visa identified a potentially fraudulent transaction and informed the issuer, but the issuer failed to initiate a chargeback under another reason code.

Prevention steps

• Monitor your fraud-to-transaction ratio and take necessary steps to prevent breaching thresholds established by Visa.
• Keep accurate records.

Reason

The merchant did not get authorization for the transaction through an account number listed in the Card Recovery Bulletin.

Typical causes

The transaction is processed for an amount beyond the merchant’s floor limit, and despite the account number being listed in the Card Recovery Bulletin for that day and region.

Prevention steps

• Always send an authorization request before processing a transaction if the amount is above your floor limit.
• Check the Card Recovery Bulletin if the transaction is below your floor limit.
• If you process transactions with multiple authorizations, make sure you fully understand Visa’s rules and regulations.

Reason

Authorization request received a Decline response and the merchant completed the transaction.

Typical causes

• The merchant did not request authorization.
• The merchant made multiple attempts on a card that was declined, or otherwise attempted to force, circumvent, or override a declined authorization.

Prevention steps

• If you receive a Decline or Pickup authorization response, either terminate the transaction or submit a second authorization request. Never proceed without authorization.
• If you process transactions with multiple authorizations, make sure you fully understand Visa’s rules and regulations.

Reason

Correct and valid authorization was not obtained by the merchant.

Typical causes

• The merchant did not request authorization.
• The merchant waited a day or more before requesting authorization.
• The merchant requested authorization for one amount, then added a tip to the total before processing.

Prevention steps

• Always authorize every transaction in accordance with the Visa Rules.
• Obtain authorization on the day of the transaction.
• Do not include the tip on the top of a previously authorized transaction.

Reason

The transaction was not sent to Visa within the timeframe required.

Typical causes

• The merchant did not process a transaction in a timely manner.
• The account was no longer in good standing at the time of processing.

Prevention steps

• Make sure you send completed transactions to your payment processor within the timeframe specified in your merchant agreement.
• A good practice is to submit transactions on the day of the sale or as soon as possible.

Reason

The cardholder is claiming that the converted amount of charge on an international transaction is incorrect.

Typical causes

The merchant processed a debit instead of a credit, processed a credit instead of processing a reversal, or in some other way processed a transaction that differed from the obtained authorization.

Prevention steps

• Double check calculations and the final transaction amount before processing.
• Train staff on the proper procedures for processing credits, debits, and reversals.

Reason

The merchant made one or more errors related to the transaction currency.

Typical causes

• The transaction currency differs from the currency transmitted through Visa.
• The cardholder was not advised or did not agree that Dynamic Currency Conversion (DCC) would occur.

Prevention steps

• Inform cardholders of the use of currency conversion and applicable fees.
• Always give the cardholder the option to make the purchase using local currency.
• Train your sales staff on proper procedures for transaction using a different currency.

Reason

The account number in the authorization does not match the account number used in the transaction.

Typical causes

• The transaction was processed to an incorrect account number.
• The adjustment was processed more than 45 days from transaction date.
• The adjustment was posted to a “closed” or “non-sufficient funds” account more than 10 days after the transaction date.
• The adjustment was processed more than once for the same transaction.
• The cardholder is disputing the validity of the adjustment.

Prevention steps

• As far as possible, swipe card or read chip for transactions.
• Process all transactions and adjustments in a timely manner.
• Double-check numbers before processing.
• Train staff on the proper procedures for processing transactions.

Reason

The cardholder is claiming that the amount they agreed to pay differs from the amount charged.

Typical causes

• An error was made entering numbers manually.
• The amount of the transaction was changed without the cardholder’s consent.

Prevention steps

• Unless authorized, never change the amount of a completed transaction without the cardholder’s consent.
• Use caution when entering handwritten transaction information.
• Always swipe or dip a card, only use fall-back options in emergencies.

Reason

A single transaction was processed two or more times.

Typical causes

• The merchant tried to submit multiple batches at one time.
• The transaction has multiple receipts.
• The transaction is duplicated in the merchant’s system.
• The transaction was processed but the cardholder paid for the same merchandise or service by other means.

Prevention steps

• If you notice a duplicate transaction, issue a refund as soon as possible.
• Double check all transaction receipts before they are deposited.
• Only send batches one time.
• If the customer wants to change to a different form of payment after initially offering the payment card, be sure to void the charge.

Reason

A single transaction was processed two or more times.

Typical causes

• The merchant tries to submit multiple batches at one time.
• The transaction has multiple receipts.
• The transaction is duplicated in the merchant’s system.
• The transaction was processed but the cardholder paid for the same merchandise or service by other means.

Prevention steps

• Review transaction receipts before depositing.
• Submit a batch only one time.
• Void or refund any duplicate transactions.
• Deposit receipts with one acquirer.
• Train staff on the proper procedures for handling credits.

Reason

The authorization was obtained using invalid or incorrect data.

Typical causes

The merchant submits an authorization request containing an incorrect transaction date, MCC, merchant or transaction type indicator, country or state code, or other required field.

Prevention steps

• Supply all necessary information with each authorization request, including transaction date, MCC, transaction type indicator, country code, and state code.
• Make sure your correct MCC is used in the authorization request, and it matches what will be sent with transaction clearing.

Reason

The cardholder is claiming that merchandise or services that they ordered were not received.

Typical causes

• The customer is claiming that the merchant did not provide the goods or services as promised.
• The merchant delayed the delivery.
• The merchant shipped but did not inform the customer.
• The cardholder is fraudulently claiming the goods or service did not arrive.

Prevention steps

• Provide goods and services as promised.
• Do not charge until after shipping.
• Use tracking and delivery confirmation.
• Provide documentation for delivery.

Reason

A recurring transaction was processed after it was cancelled.

Typical causes

• The cardholder withdrew permission.
• The merchant neglected to cancel the transaction.
• The merchant processed the transaction after being notified that the account was closed.

Prevention steps

• Provide documentation for non-cancellation.
• Prove no notification about the closed account.

Reason

The cardholder is claiming the goods were not as described.

Typical causes

• The merchandise was damaged in transit.
• The product did not match the description.
• Cardholder disputes quality.
• Cardholder is fraudulently claiming damage.

Prevention steps

• Provide documentation for accurate description.
• Rebuttal against cardholder’s claims.
• Proof for non-return of merchandise.

Reason

The merchandise was identified as counterfeit.

Typical causes

• Merchant is unaware of counterfeit.
• The customer is fraudulently claiming that the product is not genuine.

Prevention steps

• Provide proof of authenticity.
• Prove that the cardholder was aware about the product.

Reason

The cardholder’s bank received a notice from the cardholder is claiming misrepresented terms of sale.

Typical causes

• The merchant’s product descriptions are vague or inaccurate.
• Typically related to the involvement of the timeshare reseller, debt consolidation, and other causes.

Prevention steps

• Make sure all descriptions are complete and accurate.
• Clearly communicate your terms of service.
• Fully comply with all of Visa’s requirements for free trials, introductory offers, and upsells.

Reason

The cardholder’s bank received a notice from the cardholder claiming that they received authorization, credit or voided transaction receipt that has not been processed.

Typical causes

• The merchant did not credit the account.
• The merchant issued the credit but not in time to be posted to the customer’s most recent statement.
• The customer misunderstood the return policy.
• The merchant processed a transaction receipt that should have been voided.

Prevention steps

• Provide either the transaction receipt or other records to prove the properly disclosed a limited return or cancellation policy at the time of the transaction.
• Provide evidence to demonstrate that the cardholder received the cancellation or return policy and did not cancel according to the disclosed policy.

Reason

The cardholder’s bank received a notice from the cardholder stating that they returned merchandise or cancelled services, but the credit has not appeared on the cardholder’s Visa statement.

Typical causes

• The cardholder is claiming to have returned merchandise or cancelled a service, but credit has not been applied to the cardholder’s statement yet.
• The merchant has not yet issued a due credit.
• The merchant issued the credit, but it has not been posted to the customer’s account yet.
• The merchant or the customer misunderstood or was never clear on the return policy.

Prevention steps

• If you never received returned merchandise from the cardholder, provide documentation that proves inaction on the cardholder’s part.
• If you received returned merchandise but did not accept it because it violated your return policy, provide documentation that proves you refused delivery for the merchandise and why.
• Share your return or cancellation policy, note that it was displayed prominently, and show that the cardholder agreed to the terms at the time of the purchase.
• If you have already processed a refund for the transaction in question, provide documentation that proves you have credited the cardholder’s account.

Reason

The original credit was not accepted.

Typical causes

• The cardholder does not accept the credit.
• The issuer does not allow Original Credit Transactions (OCT) on certain types of cards due to local law.

Prevention steps

• Provide either the transaction receipt or other records to prove that the merchant properly disclosed a limited return or cancellation policy at the time of the transaction.
• Provide evidence to demonstrate that the cardholder received the merchant’s cancellation or return policy and did not cancel according to the disclosed policy.

Reason

Cardholder did not receive the full cash withdrawal at an ATM.

Typical causes

• The cardholder is claiming not to have received cash or only received a partial amount from an ATM withdrawal.
• The cardholder did not receive the correct load transaction value.

Prevention steps

• Provide a copy of the ATM cash disbursement transaction or load transaction record.
• Reconcile ATMs in a timely manner.
• Adjust any out of balance machines promptly.
• In case of a discrepancy, process a reversal as soon as possible.

Reason

The cardholder is claiming that neither they nor anyone authorized by them engaged in the transaction.

Typical causes

• A fraudulent use of account information.
• An unrecognized billing descriptor.
• A family member is using the account without the cardholder’s awareness.

Prevention steps

• Use identity verification tools such as Mastercard Secure Code, CVC2, and Address Verification Service (AVS).
• Use pre-sale fraud detection services.
• Always submit an authorization request, regardless of the transaction amount.
• Do not accept expired cards.
• Train staff on terminal issues.

Reason

The cardholder is claiming that a fraudulent purchase was made while the card was in the cardholder’s possession.

Typical causes

Additional unauthorized transactions were made in a short time frame after an authorized transaction.

Prevention steps

• Issue a credit for duplicate transactions as soon as possible.
• Double check all transaction receipts before depositing.
• Only send batches one time.

Reason

The acquirer processed a transaction for the merchant that later was listed in a Mastercard Global Security Bulletin for violating GMAP, QMAP, or reported to SAFE.

Typical causes

Transaction listed in Mastercard Announcement under GMAP, or violation of Mastercard’s rules.

Prevention steps

• Follow Mastercard rules and regulations.
• Maintain accurate records.
• Check transactions against the Mastercard Global Security Bulletin list.

Reason

The cardholder is claiming not to recognize a card-not-present transaction.

Typical causes

Cardholder does not recognize the billing descriptor.

Prevention steps

• Use identity verification tools such as Mastercard Secure Code, CVC2, and Address Verification Service (AVS).
• Use pre-sale fraud detection services.
• Make sure you differentiate between card-absent and card-present transactions during authorization and clearing.

Reason

The cardholder is claiming they were in possession of a valid card on the date of transaction, or they did not authorize or participate in the transaction. For counterfeit transactions only, the liability will remain with the party that does not invest in chip technology, regardless of transaction amount.

Typical causes

• The cardholder has a chip card and someone made a counterfeit copy of it.
• You processed a transaction with the counterfeit card on a terminal that was not EMV-compliant rather than using a chip reading device that would have detected the fraud. Now, the cardholder is claiming the purchase was unauthorized.

Prevention steps

• Upgrade to compliant terminals.
• Make sure to obtain the correct Cardholder Verification Method (CVM), such as a signature or PIN.
• Take an imprint (either electronic or manual) for every card-present transaction where a chip card is not used.

Reason

The cardholder is claiming they were in possession of a valid card on the date of transaction, or they did not authorize or participate in the transaction. For counterfeit transactions only, the liability will remain with the party that does not invest in chip technology, regardless of transaction amount.

Typical causes

• Fraudsters used stolen card at merchants lacking PIN support or bypassing PIN requirements, leading to unauthorized transactions.
• Merchants risk friendly fraud chargebacks under this code if they fail to comply with chip card processing rules or bypass PIN requirements due to customer deception.

Prevention steps

• Upgrade to compliant terminals.
• Make sure to obtain the correct Cardholder Verification Method (CVM), such as a signature or PIN.
• Take an imprint, either electronic or manual, for every card-present transaction where a chip card is not used.

Reason

Warning Bulletin File: Correct and valid authorization was not obtained by the merchant.

Typical causes

Mastercard is in the process of updating chargeback management regulations. Issuers are currently allowed to use reason code 4807, however, this code will soon be eliminated. It will be incorporated into code 4808. You can respond to this chargeback by providing the date and time of the original sale where an authorization code was obtained or evidence that a credit was issued. This code, while currently functional, is being consolidated into 4808 and therefore should not be used.

Prevention steps

• Always obtain authorization approval for every transaction you process.
• Always use EMV-compatible payment terminals.
• Do not force unauthorized transactions to go through.

Reason

Authorization-Related Chargeback: Correct and valid authorization was not obtained by the merchant.

Typical causes

• A transaction where authorization was required, but not obtained.
• It can occur for transactions where the primary account number (PAN) does not exist.
• A Card Not Present transactions was declined by the issuer and subsequently approved through stand-in processing or X-Code with an approval response as specified in the Authorization Manual.

Prevention steps

• Prove the transaction was presented within seven calendar days of the pre-authorization or authorization approval date and the pre-authorization or authorization was not reversed.
• Confirm authorization on all transactions.
• Make sure terminals are chip-compliant.
• Do not override declined transactions.

Reason

Authorization-Related Chargeback-Required Authorization Not Obtained: The transaction was not settled until after its expiration deadline, at which point the cardholder’s account was no longer active or in good standing.

Typical causes

The merchant was required to request authorization for the transaction, but did not request it.

Prevention steps

• Always request an authorization request before processing a transaction.
• Do not exceed 20% when adding gratuities.
• Follow Mastercard regulations and best practices.

Reason

Authorization-Related Chargeback-Expired Chargeback Protection Period: The transaction was not settled until after its expiration deadline, at which point the cardholder’s account was no longer active or in good standing.

Typical causes

The merchant waited too long to settle the transaction.

Prevention steps

• Always request authorization before processing a transaction.
• Settle pre-authorized transactions within 30 calendar days of the latest authorization date.
• Settle any transaction that are not pre-authorized within seven calendar days of the authorization date.

Reason

Authorization-Related Chargeback-Multiple Authorization Requests: A card-not-present transaction was declined by the issuer, but later approved using Stand-In processing or X-Code.

Typical causes

• The original attempt at authorization was not approved, but the merchant swiped over and over to receive authorization.
• An alternative authorization method was used, such as key entering or voice authorization.

Prevention steps

• Always request authorization before processing a transaction.
• Terminate any declined transactions and request an alternate payment method.
• Follow Mastercard rules and regulations.

Reason

Authorization-Related Chargeback-Cardholder-Activated Terminal (CAT) 3 Device: Unauthorized transactions processed at a cardholder-activated terminal (CAT).

Typical causes

• The amount of a CAT 3 transaction exceeded the acceptable limit.
• A card used in a CAT 3 transaction was not valid at the time.

Prevention steps

• Always request authorization before processing a transaction.
• Terminate any declined transactions and request an alternate method of payment.
• Follow Mastercard rules and regulations.

Reason

Account Number Not On File: Account number does not correspond to the account numbers the issuer has on file for this cardholder.

Typical causes

The issuer receives a transaction with an account number that does not match any account numbers on file for the cardholder. An issuer may continue to use reason code 4812, however, Mastercard will eventually eliminate 4812 as a valid reason code. 4808 will be used instead.

Prevention steps

• Provide evidence that the account number on the transaction receipt is correct and matches cardholder information.
• This code, while currently functional, is being consolidated into 4808, and therefore should not be used.

Reason

Point-of-Interaction Error: A single transaction was processed more than one time.

Typical causes

• The cardholder paid twice for the same transaction using two different forms of payment.
• The cardholder’s account has been debited more than once for the same transaction using the same form of payment.

Prevention steps

• Review transaction receipts before depositing.
• Submit a batch only one time.
• Credit any duplicate transactions.
• Deposit receipts with only one acquirer.
• Train staff on the proper procedures for handling credits.

Reason

Point-of-Interaction Error - Transaction Amount Differs: The amount charged does not match the amount indicated on the receipt.

Typical causes

• The merchant made an error when calculating the transaction amount.
• The merchant increased or otherwise altered the amount after the transaction was completed without the cardholder’s permission.

Prevention steps

• Double check calculations and the final transaction amount before processing.
• Do not change the transaction amount without the cardholder’s consent.
• Void any transactions if the cardholder wishes to use a different payment method.

Reason

Point-of-Interaction Error - Late Presentment: The transaction was not deposited within 30 days of the date a valid authorization code was obtained.

Typical causes

• The transaction was not processed in a timely manner and the account has since been closed.
• The transaction was posted after 180 days of the original transaction date.

Prevention steps

• Always send an authorization request before processing a transaction.
• Present transactions to the issuer within the specified time limit.
• Send completed transactions to your card processor as soon as possible, preferably on the day of the sale.

Reason

Point-of-Interaction Error - Correct Transaction Currency Code Not Provided (Dynamic currency): A cardholder is claiming the converted amount of charge on an international transaction is incorrect.

Typical causes

• The transaction currency differs from the currency transmitted through Mastercard.
• The cardholder was not advised or did not agree that Dynamic Currency Conversion (DCC) would occur.

Prevention steps

• Do not automatically apply dynamic currency conversion to transactions.
• Give customers the option to select the service if they are interested, but do not require its use.
• Have systems in place to manage multiple currencies.
• Make sure staff are trained on procedures.
• Inform cardholders of the use of currency conversion and applicable fees.
• Always give the cardholder the option to make the purchase using local currency.

Reason

Point-Of-Interaction Error - ATM Disputes: The cardholder charges that an inaccurate amount of cash was dispensed by an ATM, or that the ATM withdrawal had been debited to the account multiple times.

Typical causes

ATM issues.

Prevention steps

• Reconcile ATMs in a timely manner.
• Report out-of-balance ATMs.

Reason

Point-Of-Interaction Error - Loss, Theft, or Damages: The cardholder is claiming an unauthorized charge for loss, theft, or damage was added to the transaction up front.

Typical causes

The merchant processed a transaction which included an upfront charge for loss, theft, or damage, without the cardholder’s approval.

Prevention steps

• Do not add damage charges to a transaction without the knowledge and agreement of the cardholder.
• Clearly explain any circumstances which might trigger a charge for loss, theft, or damage.
• If loss, theft, or damage charge is to be added, process the original transaction, then process a second transaction for any additional fees.

Reason

Point-Of-Interaction Error - Duplication/Paid by Other Means: A single transaction was processed more than one time.

Typical causes

• The merchant submitted a single batch of transactions multiple times.
• The merchant deposited both copies of the sales receipt (merchant and sales copy).
• The merchant created two sales receipts for a single transaction.
• The merchant deposited a receipt with more than one acquirer.
• The merchant processed a single transaction multiple times on the same card or to another payment method.

Prevention steps

• Review transaction receipts before depositing.
• Submit a batch only one time.
• Credit any duplicate transactions.
• Deposit receipts with only one acquirer.
• Train staff on the proper procedures for handling credits.

Reason

Installment Billing Dispute: The cardholder is claiming an installment charge to their account was made incorrectly.

Typical causes

• The merchant charged the cardholder prematurely.
• The merchant charged the cardholder the incorrect amount, or the transaction was not an installment.

Prevention steps

• Make sure you bill the cardholder installment transactions correctly as agreed.
• Train staff on importance of accuracy.

Reason

Domestic Chargeback Dispute (Europe Region Only): A centrally acquired domestic transaction, where a chargeback is available according to the applicable domestic rule, but cannot be processed under a different message reason code.

Typical causes

The customer is stating that the transaction should have been a credit to the account but was processed as a sale.

Prevention steps

Responses to these disputes are varied based on the details provided from the cardholder and issuer.

Reason

• The recurring transaction was processed after it was cancelled or the cardholder’s account was closed.
• The cardholder is claiming they should not have been charged because they already cancelled the transaction.

Typical causes

• Mastercard is in the process of updating chargeback management regulations. Issuers are currently allowed to use reason code 4841, however, this code will soon be eliminated. It will be incorporated into code 4853.
• The cardholder is claiming the merchant continued to bill the card after a recurring transaction was cancelled, or without explicit consent from the cardholder.

Prevention steps

• Show that the chargeback is either remedied or invalid.
• Provide documentation to validate your case.

Reason

The cardholder is claiming the merchant continued to bill the card after a recurring transaction was cancelled, or without explicit consent from the cardholder.

Typical causes

• The merchant sent the wrong item.
• The item was damaged during shipping.
• The merchant inaccurately described the products or services.
• The merchant did not perform the services as described.
• The merchant did not accept a product return.
• The merchant sold counterfeit products.
• The quality of goods or services was not adequate.

Prevention steps

• Clearly explain the situations that might cause you to charge the card including charges for loss, theft, or damage.
• Have the cardholder read and agree to terms of service before processing the original transaction.
• Double check orders to ensure the correct item is shipped.
• Provide honest, detailed product descriptions.
• Accept returns from cardholders and issue credit promptly.
• Never sell counterfeit products.

Reason

The cardholder is claiming that merchandise or services that they ordered were not received or that the cardholder cancelled the order as the result of not receiving the merchandise or services by the expected delivery date (or merchandise was unavailable for pick-up).

Typical causes

• The merchant failed to provide goods or services.
• The merchant has gone out of business or can no longer provide the goods or services for some other reason.

Prevention steps

• Ensure the promised delivery dates.
• Accurately describe the services that will be provided, including availability window.
• Do not process the charge prior to order shipment.
• Immediately advise customers of unforeseen delays, for example, due to the merchandise is out of stock, shipping delays, or other reasons.

Reason

The cardholder is claiming that an additional or unauthorized charge was added after a valid transaction without their consent.

Typical causes

The cardholder is claiming they are not responsible for an addendum, no-show, or ATM dispute.

Prevention steps

• Clearly explain all terms and conditions and costs prior to finalizing.
• Respond to cancellation requests in a timely manner, and confirm with the cardholder.
• Train staff members on the correct ways to handle cancellations or reservation changes.

Reason

The cardholder is claiming they are due a credit from an establishment that has not been processed.

Typical causes

• The merchant did not acknowledge the return or cancellation.
• The merchant failed to process the credit or reversal.
• The merchant failed to fully explain the return or cancellation policy.

Prevention steps

• Process all qualified requests for cancellation or refund as soon as possible.
• Clearly advise customers on no-return or limited return policies, including any fees.
• For card-not-present transactions, require customer acknowledgment and confirmation action prior to final purchase.
• Refuse delivery of any returns that do not follow your stated policy.
• Advise the customer if the credit will be for a lesser amount, and explain why.

Reason

The cardholder is claiming that the goods or services provided did not match the description listed or verbally provided at the time of purchase, were defective or damaged, or the quality was not what was expected.

Typical causes

• The merchant shipped the wrong merchandise to the cardholder.
• The merchandise was damaged during shipment due to improper packing.
• The merchandise was defective in some way before shipping.
• The merchant inaccurately described the merchandise or services.
• The merchant did not perform the services as described.

Prevention steps

• Check all service and product descriptions for clarity and accuracy.
• Immediately fulfill all valid requests for replacements or refunds.
• Do not refer customers to the manufacturer in cases of damaged or defective goods.
• Employ best practices for packing and shipping.

Reason

The cardholder is claiming that card information used to create an account for digital purchases lacked necessary purchase controls, leading to unauthorized purchases.

Typical causes

The merchant did not ensure that sufficient purchase controls were in place for the account, and digital goods were purchased (valued at less than $25).

Prevention steps

• Disable purchases by default and require cardholders to opt-in for purchasing.
• Require cardholders to provide authentication information before each purchase.
• Time-out purchase ability after a set period of inactivity.
• Clearly show total transaction amounts for pending purchases and require cardholder confirmation.
• Confirm purchases immediately via email or text.

Reason

The cardholder received counterfeit merchandise.

Typical causes

The merchant knowingly or unknowingly shipped goods that were not what they were claimed to be.

Prevention steps

• Order and sell only genuine merchandise.
• Check to ensure that inventory is what it claims to be.
• Double-check all product descriptions for accuracy.

Reason

Merchandise or services were not used by the purchaser, who believed the transaction was not actually processed.

Typical causes

The cardholder believed that goods or services were not provided (and therefore were not used) because the transaction was never processed.

Prevention steps

Always confirm transactions via text or email.

Reason

A credit was processed as a debit.

Typical causes

The merchant knowingly or unknowingly processed a sale which should have been processed as a credit.

Prevention steps

Train staff on the proper procedures for processing credits.

Reason

The cardholder is claiming that they are unhappy with the goods or services provided and that they have been unable to resolve the situation with the merchant.

Typical causes

The cardholder has made an unsuccessful good-faith effort to resolve a dispute with the merchant.

Prevention steps

• Respond by providing an assertion based on the documentation that you corrected the deficiency that led to the chargeback or otherwise resolved the complaint.
• Provide proof that the chargeback was invalid because the cardholder paid the disputed amount before contracting the merchant or issuer about the dispute.

Reason

The cardholder is denying their authorization of the charge and your business has been placed in the Fraud Full Recourse Program.

Typical causes

• Merchant falls under high-risk category.
• The issuer receives an unusual number of inquiries and chargebacks compared to processing history.
• The merchant account has been disabled or cancelled due to suspicious activities or violation of the agreement.

To respond, provide proof that you had not been placed in the Fraud Full Recourse Program at the time of the chargeback, or proof that a credit which directly offsets the disputed charge has already been processed.

Prevention steps

• Always obtain authorized approval for e-commerce and recurring transactions regardless of the dollar amount.
• Always verify the account number to prevent errors or misunderstandings.
• Properly identify the type of transaction, such as card-not-present.
• Use security codes and AVS.
• Simplify or clarify billing descriptors.

Reason

The cardholder has disputed the charge, and you have been placed in the Immediate Chargeback Program.

Typical causes

• The merchant enrolled himself in this program to avoid receiving inquiries and disputes.
• Amex put the merchant in the program due to odd number of disputes.
• The merchant’s business falls under high chargeback ratio industry.

Provide proof that you had not been placed in the Immediate Chargeback Program at the time of the chargeback, or prove that a credit which directly offsets the disputed charge has already been processed.

Prevention steps

• Always obtain an authorized approval for e-commerce and recurring transactions regardless of the dollar amount.
• Always verify account numbers.
• Use security codes and AVS.
• Set billing descriptor correctly.
• Train staff on the proper handling of terminal issues.

Reason

The cardholder has disputed the charge and the merchant has been placed in the Partial Immediate Chargeback Program by American Express.

Typical causes

• The merchant enrolled himself in this program to avoid receiving inquiries and disputes.
• Amex put the merchant in the program due to odd number of disputes.
• The merchant’s business falls under high chargeback ratio industry.

Prove that you had not been placed in the Partial Immediate Chargeback Program at the time of the chargeback, or show that a credit which directly offsets the disputed charge has already been processed.

Prevention steps

• Always obtain an authorized approval for e-commerce and recurring transactions regardless of the dollar amount.
• Always verify account numbers.
• Use security codes and AVS.
• Set billing descriptor correctly.

Reason

The cardholder did not participate in a purchase and was not provided a copy of the card imprint (card-present environments only).

Typical causes

The cardholder is claiming that they did not participate in this charge, and you have not provided a copy of an imprint of the card. Note: Not applicable to Card Not Present charges or charges that qualify under the Keyed No Imprint Program.

Send proof that the charge qualifies under the Keyed No Imprint Program, or proof that this was a Card Not Present charge.

Prevention steps

• Always request authorization for mail order, telephone order, internet, and recurring transactions, regardless of the dollar amount.
• Obtain additional validation, such as an imprint or PIN, or through CDCVM.
• Set billing descriptor correctly.

Reason

The cardholder is claiming not to have been involved in a transaction that was processed (card-present environments only).

Typical causes

• The merchant neglected to give the cardholder a copy of the signed receipt.
• The signature on the receipt is invisible or not prominent due to light ink, ribbed or colored paper, or fading.
• The original order receipt is mishandled or is scanned at a smaller size.

Prevention steps

• Scan or make copies of the order receipt at actual size.
• Maintain full ink/toner in machines.
• Print and keep a copy of the order receipt.
• Always provide cardholder with a copy of the receipt.

Reason

The cardholder is claiming that they did not participate in this charge, and the merchant submitted the payment, but the change was not authorized. The charge was declined or submitted with an expired authorization.

Typical causes

• The merchant processed an invalid account number.
• The family member ordered from the primary cardholder’s account without permission.
• The cardholder is not able to recognize purchase on the billing statement.
• A criminal fraud was committed.

Provide proof that you have processed a credit which directly offsets the disputed charge.

Prevention steps

• Always obtain authorized approval.
• Use secondary validation methods such as PIN.
• Set clear billing descriptors.

Reason

The cardholder’s bank received a complaint from the cardholder indicating an unauthorized card-not-present transaction.

Typical causes

In a card-absent environment, such as online/phone/direct mail sales:

• An unauthorized (fraudulent) claim was processed using an invalid or stolen account number.
• Due to an unclear or a confusing merchant name the cardholder believes the transaction to be fraudulent.

Provide proof that the cardholder participated in the charge, for example, billing authorization, usage details, proof of delivery to the cardholder’s billing address, contract, or proof that the transaction contains a shipping address that matches a previously used shipping address from an undisputed transaction.

Prevention steps

• Always request authorization for mail order, telephone order, internet, and recurring transactions, regardless of the dollar amount.
• Obtain additional validation, such as an imprint or PIN.
• Clearly and properly identify card present and card absent transactions.

Reason

The cardholder is denying their participation in the charge and a counterfeit chip card was used at a POS system where the transaction was not processed as a chip transaction.

Typical causes

• The POS system was not enabled for chip, or the transaction was manually keyed.
• The merchant’s card processor did not transmit the full chip data to Visa.
• The chip-reading terminal was not actually used.

Provide proof that this was a Card Not Present charge or proof that the POS system processed a chip card transaction.

Prevention steps

• Upgrade to compliant terminals.
• Make sure to obtain additional validation, such as an imprint or PIN.
• Take an imprint (either electronic or manual) for every card-present transaction.
• Train staff on the proper handling of terminal issues.

Reason

The cardholder is denying their participation in the charge and chip card with PIN capabilities was lost/stolen/non-received and was used at a POS system where the transaction was not processed as a chip card transaction with PIN validation.

Typical causes

• The merchant did not ensure that the card was either swiped or that the chip was read.
• The merchant did not obtain manual card imprint on a key-entered transaction.
• The card-not-present transaction was not identified as such.
• Fraud was committed.

Either provide proof that this was a Card Not Present charge, proof that the POS system processed a chip card transaction with PIN validated, or proof that a credit which directly offsets the disputed charge has already been processed.

Prevention steps

• Upgrade to compliant terminals.
• Make sure to obtain additional validation, such as an imprint or PIN.
• Take an imprint, either electronic or manual, for every card-present transaction.
• Train staff on the proper handling of terminal issues.

Reason

The merchant has submitted a transaction that was of an amount greater than the authorized approval.

Typical causes

• The transaction was processed for an amount beyond the merchant’s floor limit.
• There was an error when entering numbers manually.

Provide proof that a valid authorization approval was obtained for the full amount of the charge in accordance with the agreement.

Prevention steps

• Do not process a transaction when a declined authorization has been received.
• Do not process a transaction for more than the allowed tolerance level above the authorization amount.

Reason

• No authorization was requested by the merchant.
• The card has expired.
• The card was declined.

Typical causes

• The transaction was made after the authorization code and transaction date.
• The limited authorization index was present in the authorization request.
• The transaction amount exceeds the amount in the limited authorization response.
• The vendor did not exclude the tip in the authorization amount.
• The card was expired and/or the account was closed.

Provide proof that a valid authorization approval was obtained in accordance with the agreement. For an expired or not yet valid card, provide proof that the charge was incurred before the expiration date or within the valid dates on the card.

Prevention steps

• Always authorize every transaction in accordance with the merchant agreement.
• Obtain authorization on the day of the transaction.
• Do not include the tip on a previously authorized amount.
• Obtain confirmation of authorization before completing all transactions.

Reason

The transaction submission was made after the authorization approval had expired.

Typical causes

• The transaction was not approved.
• The transaction was submitted after the expiration of the authorization approval.
• The authorization request was denied.
• The transaction was made using an expired card.

Provide proof that a valid authorization approval was obtained in accordance with the agreement, or that a credit offsetting the disputed charge has already been processed.

Prevention steps

• Process all transactions in a timely manner.
• Do not process a transaction when a declined authorization has been received.
• Do not process a transaction made with an expired card.
• Train staff on the proper handling of authorization approvals.

Reason

The card number used for the transaction is not assigned to a valid account, or not assigned to the cardholder.

Typical causes

• The merchant made an error, either in entering or calculating information.
• The cardholder supplied an incorrect or invalid card number.

To respond to this chargeback, provide a copy of the imprint that confirms the card number, proof that you obtained an authorization approval for such card number, or a copy of the charge record from the terminal that electronically read the card number.

Prevention steps

• Double check numbers.
• Obtain secondary validation, such as PIN.

Reason

The merchant processed a credit as a charge.

Typical causes

The merchant processed a debit instead of a credit, processed a credit instead of processing a reversal, or in some other way processed a transaction that differed from the obtained authorization.

Respond by providing proof that the charge was submitted correctly, or proof that a credit which directly offsets the charge has already been processed.

Prevention steps

• Double check calculations, amount, and type of transaction before processing.
• Train staff on the proper procedures for processing credits, debits, and reversals.

Reason

Merchant needed to charge an account, but instead processed it as a credit.

Typical causes

The merchant processed a credit instead of a debit, or in some other way processed a transaction that differed from the obtained authorization.

Respond by providing proof that the credit was submitted correctly, or proof that a credit which directly offsets the charge has already been processed.

Prevention steps

• Double check calculations, amount, and type of transaction before processing.
• Train staff on the proper procedures for processing credits, debits, and reversals.

Reason

The cardholder is claiming that the charge amount the merchant submitted differs from the agreed amount.

Typical causes

• The merchant made an error, either in entering or calculating information.
• The merchant changed the amount of the transaction for some reason, such as adding a tip.
• The merchant exchanged the amount post-transaction without the cardholder’s permission.

Provide proof that the cardholder agreed to the amount submitted, proof that the cardholder was advised of and agreed to pay for any additional or delayed charges using the card the charge was submitted to, an itemized contract or documentation substantiating the charge amount submitted, or proof that a credit which directly offsets the disputed charge has already been processed.

Prevention steps

• Double check calculations and the final transaction amount before processing.
• Do not alter the transaction amount without the cardholder’s consent.

Reason

The charge was not submitted within the required timeframe.

Typical causes

• The transaction was not processed in a timely manner and the account has since been closed.
• The transaction was posted after 181 days of the original transaction date.

Prove that the charge was submitted within the required timeframe, or that a credit which directly offsets the disputed charge has already been processed.

Prevention steps

• Deposit order receipt with your acquirer as soon as possible, preferably on the day of the sale.
• Complete payment batches as soon as possible.
• Process transactions within 180 days of the original purchase.
• Be aware that paper receipts typically take longer to process.

Reason

The single charge was submitted more than once.

Typical causes

• The merchant tries to submit multiple batches at one time.
• The transaction has multiple receipts.
• The transaction is duplicated in the merchant’s system.
• The transaction was processed but the cardholder paid for the same merchandise or service by other means.

Provide documentation showing that each charge is valid, or proof that a credit which directly offsets the disputed charge has already been processed.

Prevention steps

• Review transaction receipts before depositing.
• Submit a batch only one time.
• Void and credit any duplicate transactions.
• Train staff on the proper procedures for handling credits.

Reason

The card number used for the transaction is not assigned to a valid account, or not assigned to the cardholder.

Typical causes

• The merchant processed the transaction to an incorrect account number.
• The merchant did not authorize the transaction, and it was processed to an account number not on the issuer’s master file.

Send a copy of the card imprint confirming the card number, or copy of the charge record from the terminal that electronically read the card number as your response.

Prevention steps

• As far as possible, swipe card or read chip for transactions.
• Double-check numbers before processing.
• Confirm account numbers with customers for card-not-present transactions.
• Train staff on the proper procedures for processing transactions.

Reason

The merchant made one or more errors related to the transaction currency.

Typical causes

• The transaction currency differs from the currency transmitted through Visa.
• The cardholder was not advised or did not agree that Dynamic Currency Conversion (DCC) would occur.

Provide evidence that a credit which directly offsets the disputed charge has already been processed.

Prevention steps

• Inform cardholders of the use of currency conversion and applicable fees.
• Always give the cardholder the option to make the purchase using local currency.
• Train your sales staff on proper procedures for transactions using a different currency.

Reason

American Express received merchant authorization to process a chargeback for the charge.

Typical causes

The merchant authorized the chargeback.

Since you indicated acceptance of the chargeback, you likely do not need to respond to the dispute. If you do, supply proof that a credit has already been processed.

Prevention steps

• Maintain complete and accurate records for each transaction you process.
• Make sure you can access this information quickly and easily.

Reason

The cardholder is claiming that the merchant incorrectly billed for capital damages.

Typical causes

• The cardholder misunderstood responsibility for capital damages.
• The cardholder disagrees with charges.
• Total damages exceed 110% of the agreed-upon amount.
• The merchant made an error in calculating the total.

Submit proof that the charge submitted was within the specific estimate of the damages agreed in writing by the cardholder, plus 15%. Or submit proof that can refute the cardholder’s claim that they were covered by insurance. Or show that the charge was valid and not for theft or loss of use.

Prevention steps

• Maintain proof that the cardholder agreed to and signed an acknowledgment of responsibility for capital damages.
• Make sure total charges do not exceed 110% of the agreed-upon amount.

Reason

The cardholder is claiming to have been incorrectly charged for theft or loss of use of a rental vehicle.

Typical causes

The merchant bills the cardholder for AMX-covered costs.

Prevention steps

• Maintain proof that charges were valid and not for theft, loss of use, or other fees.
• Maintain proof that a credit which directly offsets the disputed charge has already been processed.

Reason

Complete support and/or documentation were requested but not provided.

Typical causes

• The merchant did not provide the requested support.
• The merchant did not supply documents requested.
• The merchant supplied only partial documentation.

Prevention steps

• Maintain complete and accurate records for each transaction you process.
• Keep records of communication and provided support.
• Make sure you can access this information quickly and easily.

Reason

American Express did not receive a response to an inquiry within the specified timeframe.

Typical causes

• The merchant did not respond to an American Express inquiry.
• The merchant responded to an American Express inquiry, but not within 20 days.

Prevention steps

• Maintain proof you responded to the original inquiry within the specified timeframe.
• Maintain proof that a credit which directly offsets the disputed charge has already been processed.

Reason

The authorization has expired before the transaction was submitted.

Typical causes

• The merchant did not credit the account.
• The merchant issued the credit but not in time to be posted to the customer’s most recent statement.
• The customer misunderstood the return policy.
• The merchant processed a transaction receipt that should have been voided.

Prevention steps

• If no credit or only partial credit is due, provide a written explanation.
• Issue credits promptly.
• Share the return policy with the cardholder.
• Notify the cardholder when the credit has been issued.
• Consider simplifying and clarifying your return policy.

Reason

The cardholder has provided proof that merchandise was returned.

Typical causes

• The cardholder refused delivery of goods or services and has not yet received a credit.
• The cardholder returned goods and has not yet received a credit.

Prevention steps

• Supply a written explanation refuting the cardholder’s claim.
• Disclose the return policy clearly on the transaction receipt.
• Do not accept delivery of returned merchandise if it does not comply with your policy.
• Fulfill all qualified cancellations or refund requests promptly.
• Communicate any reduced amount before processing the credit.

Reason

The cardholder is claiming that the order for goods or services was cancelled.

Typical causes

• The goods or services ordered were cancelled, but you did not provide a refund.
• The cardholder is insisting on cancelling goods or services ordered.

Prevention steps

• Provide a copy of your cancellation policy.
• Include proof that a credit which directly offsets the disputed charge has already been processed.

Reason

The charge represents merchandise that was not received by the cardholder.

Typical causes

• The merchant did not ship the goods or service by the agreed delivery date.
• The merchant did not clearly explain the expected shipping or arrival date.
• The merchant billed the cardholder before delivery of merchandise.
• The merchant did not make order available for pick-up.

Prevention steps

• Provide proof of delivery.
• In the case of a delayed order, always notify the customer.
• Clearly display the expected shipping date and delivery date on the invoice.
• Provide a signed order receipt or invoice showing receipt of services or merchandise.

Reason

The cardholder has provided American Express with proof of payment by another method.

Typical causes

• The merchant did not void multiple transactions.
• The transaction was processed but the cardholder paid for the same merchandise or service by other means.

Prevention steps

• Provide documentation showing the unrelated payment.
• Double check calculations and the final transaction amount before processing.
• Void any transactions if the cardholder wishes to use a different payment method.

Reason

The cardholder’s account was charged for a “no-show” billing, despite cancelling the reservation. The cardholder has obtained a cancellation number. This number will be listed.

Typical causes

• The cardholder was billed for lodging services that were allegedly cancelled.

Prevention steps

• Either supply documentation supporting the validity of the “no show” reservation or CARDeposit charge.
• Always inform the cardholder of your cancellation policy at the time of the reservation.
• Log all confirmation and cancellation numbers as required by the CARDeposit programs.

Reason

The charge has been submitted after the merchant was advised to discontinue all future billing.

Typical causes

• The cardholder withdraws permission to change the account, or cancelled payment for subscription.
• The cardholder or issuing bank cancels the account.
• The merchant neglects to cancel a recurring transaction.
• The merchant processes a transaction after being notified the cardholder’s account was closed.

Prevention steps

• Provide a copy of your cancellation policy.
• Terminate recurring transactions when the cardholder requests cancellation.
• Consider a no-strings-attached cancellation policy.
• Do not increase the transaction amount without the cardholder’s consent.
• Do not prematurely bill the cardholder.
• Send notifications for upcoming charges.

Reason

The cardholder is claiming to have received goods or services that are different from the written description provided at the time of the charge.

Typical causes

• The merchandise was damaged upon its arrival.
• The merchandise does not match the merchant’s description.
• The cardholder disputes the quality of the product.
• The cardholder is fraudulently claiming the merchandise is damaged or not as described.

Prevention steps

• Provide proof refuting the cardholder’s claim that the written description differs from the goods or services received.
• Double check orders to ensure the correct item is shipped.
• Package items carefully to avoid damage during shipping.
• Provide honest, detailed product descriptions.
• Accept returns from cardholders and issue credit promptly.
• Never sell counterfeit products.

Reason

The cardholder’s bank received a claim from the cardholder stating that the goods were shipped to the cardholder, but were damaged or defective.

Typical causes

• The merchandise was damaged upon its arrival.
• The cardholder is fraudulently claiming the merchandise is damaged.

Prevention steps

• Supply proof refuting the cardholder’s claim that the goods or services were damaged or defective.
• Package items carefully to avoid damage during shipping.
• Provide honest, detailed product descriptions.
• Accept returns from cardholders and issue credit promptly.
• Never sell counterfeit products.

Reason

The fraudulent transaction was made using the actual card, according to the cardholder.

Typical causes

• The fraudulent transaction was made using the actual card, according to the cardholder.
• Merchant processed the order without authorization.
• Card was not swiped through the magnetic stripe reader.
• Card-not-present transaction was not identified as such.

Prevention steps

• Show that the transaction is not fraudulent by providing a valid, legible transaction receipt.
• Provide evidence that the cardholder was present at the time of the card transaction.
• Ensure all security features required to be embossed on the card are visible on the receipt.

Reason

The cardholder is claiming that they did not approve or participate in a Card Not Present (CNP) transaction.

Typical causes

• Cardholder is claiming that a fraudulent transaction was made in a card-absence environment.
• The merchant does not request authorization.
• there are multiple charge attempts on a declined card.

Prevention steps

• Prove items were delivered and Address Verification Service was used.
• Validate the numeric portion of the cardholder’s billing address, including street address and ZIP code.
• Address Verification request response indicated the cardholder’s address is not verified due to issuance outside the U.S.

Reason

The cardholder alleges that a counterfeit card was used to conduct a card sale or cash advance, and a Contact Chip Payment Device was issued.

Typical causes

• The merchant’s card processor did not transmit the full chip data.
• The chip-reading terminal was not actually used.
• The transaction was made fraudulently by an unauthorized person.

Prevention steps

• Show your POS device was enabled to support chip card transactions using EMV technology.
• Provide evidence that your POS device completed the card transaction using magnetic stripe data and identified it as Fallback.

Reason

The cardholder alleges fraud relating to a Card Present chip card transaction, including a cash advance.

Typical causes

• The cardholder is claiming not to have been involved in a transaction processed using a hybrid card.
• The merchant’s card processor did not transmit the full chip data.
• The transaction was made fraudulently by an unauthorized person.

Prevention steps

• Show the chip card transaction was completed with PIN entry on a chip card terminal.
• Prove a Fallback transaction was properly identified in the Authorization request.
• Indicate the card transaction was not a card-not-present transaction.
• Show that track data indicated the card sale was not conducted with a Contact Chip Payment Device.

Reason

The issuer is requesting documents for a transaction the cardholder is claiming to be fraudulent (card-present).

Typical causes

• The issuer is requesting documents for a transaction the cardholder is claiming to be fraudulent (card-present).
• The transaction signature does not match the card signature.
• The merchant did not obtain authorization.
• The receipt or other transaction documents are illegible.

Prevention steps

• Always obtain authorization.
• Make sure all card-present transactions are either chip-read or magnetic stripe-read.
• Obtain an imprint or perform additional validation, such as PIN.
• Always obtain legible signed receipt, and provide customer with a copy.

Reason

The cardholder is claiming that the payment activity was fraudulent (card-present).

Typical causes

• The cardholder is claiming that the payment activity was fraudulent (card-present).
• The merchant did not obtain signature on a transaction.
• The merchant did not obtain authorization.
• The receipt or other transaction documents are illegible.

Prevention steps

• Obtain the cardholder’s authorization at the time of sale.
• Obtain the cardholder’s signature at the transaction receipt.
• If terminal cannot recognize or read the card’s magnetic stripe, request authorization by key entering the account number.
• If terminal is not working, call center for authorization and mention approval code on the order receipt.

Reason

The merchant did not obtain a valid Authorization response, and the issuer cannot collect the card sale amount from the cardholder.

Typical causes

• The transaction was processed without a positive authorization response and/or contains an authorization response beyond the card expiration date.
• The transaction was processed without electronic authorization, voice approval, or account verification.
• The transaction was forced after initially being declined.

Prevention steps

• Provide evidence of a positive Authorization response from the issuer for the card sale, which can be validated in the issuer’s records.
• Always obtain authorization.
• Do not force a transaction when a declined authorization has been received.
• Do not process a transaction for more than the allowed tolerance level above the authorization amount.

Reason

The declined transaction was presented for processing.

Typical causes

• The merchant did not request authorization.
• The merchant made multiple attempts on a card that was declined.
• The merchant otherwise attempted to force, circumvent, or override a declined authorization.

Prevention steps

• Obtain authorization.
• Discontinue the transaction if a card has been declined.
• Ask for an alternate form of payment.
• Never force an authorization.

Reason

The cardholder is challenging the validity of the transaction because the card had expired at the time.

Typical causes

• The card expired before the transaction date.
• The merchant processed the transaction without authorization.
• The card was valid at the time of transaction but expired before the transaction was processed.

Prevention steps

• Always check the expiration date on all cards.
• Double check customer’s claim of expiration on card-not-present transactions.
• Always request authorization.
• Do not force transactions.

Reason

The transaction was processed without authorization.

Typical causes

• The merchant did not request authorization.
• The merchant waited a day or more before requesting authorization.
• The merchant requested the authorization for one amount, then added a tip to the total before processing.

Prevention steps

• Always authorize every transaction.
• Obtain authorization on the day of the transaction.
• Do not add the tip to a previously authorized amount.

Reason

The card number provided by the merchant was not valid.

Typical causes

• The card number used for the transaction was not assigned to a valid account, or not assigned to the cardholder.
• The merchant mistyped or calculated incorrectly.
• The card expired.

Prevention steps

• Provide transaction documentation showing three things: the card number is accurate and was not listed on the Negative File at the time that Downtime Authorization Services were used to obtain an Authorization Response for the card transaction.
• The receipt of a positive Authorization response.
• The cardholder’s signature (if required).

Reason

The sales data was submitted for the card sale later than the number of calendar days permitted for timely sales data submission. The card sale was also not for a delayed delivery card sale.

Typical causes

• The transaction was completed past the required time limits.
• The merchant did not process a transaction in a timely manner.
• The account was no longer in good standing at the time of processing.
• The transaction was delayed due to a POS system issue.

Prevention steps

• Provide evidence of compliance with delayed delivery requirements and receipt of a valid Authorization response within the applicable number of calendar days of the ship date, expected delivery date or processing attempt.
• Show that the cardholder approved the submission of sales data after the applicable number of calendar days.

Reason

Any claims of invalid transactions which do not fall under any other classification.

Typical causes

• The merchant’s attempts to resolve the issue were unsuccessful.
• Other reasons specific to the claim.

Prevention steps

• Provide transaction documentation showing three things: the card number is accurate and was not listed on the Negative File at the time that Downtime Authorization Services were used to obtain an Authorization response for the card transaction.
• The receipt of a positive Authorization response.
• The cardholder’s signature (if required).

Reason

Any claims of invalid transactions which do not fall under any other classification.

Typical causes

• The cardholder is challenging the validity of a transaction because the card had expired at the time of the transaction.
• Card expired before the transaction date.
• The merchant processed the transaction without authorization.
• The card was valid at the time of transaction but expired before the transaction was processed.

Prevention steps

• Always check the expiration date on all cards.
• Double check customer’s claim of expiration on card-not-present transactions.
• Always request authorization.
• Do not force transactions.

Reason

The merchant accepted responsibility in response to a Good Faith Investigation Ticket Retrieval Request.

Typical causes

The merchant accepted responsibility in response to a Good Faith Investigation Ticket Retrieval Request.

Prevention steps

Evidence may be submitted to Discover that the cardholder received duplicate credits if you have applied a credit to the card account in response to a Good Faith Inquiry and a chargeback was also processed because you accepted responsibility for the card transaction. In all other cases, this chargeback is final and not subject to appeal.

Reason

The cardholder is claiming that their account was charged or credited for a card transaction (other than an ATM transaction) that they do not recognize.

Typical causes

• The cardholder’s claim that they do not recognize the transaction appearing on the cardholder’s statement.
• The cardholder’s billing statement is incorrect.
• The customer has forgotten about the transaction.
• The cardholder does not recognize the billing descriptor.
• The customer wants a refund without going through the regular process.
• The customer was not aware that a family member used the card.

Prevention steps

Keep records to evidence that the cardholder received the goods or services related to the disputed transaction and that the transaction was completed in accordance with the Agreement and Operating Regulations, as applicable.

Reason

The cardholder is challenging the validity of recurring payments card sales after expiration or cancellation of the recurring payments plan agreement.

Typical causes

• The cardholder’s claim to have been charged for a cancelled recurring transaction.
• The cardholder withdrew permission to charge the account or cancels payment for subscription.
• The merchant neglected to cancel a recurring transaction.
• The merchant processed a transaction after being notified the cardholder’s account was closed.
• The merchant raised the charge amount without informing the cardholder.

Prevention steps

Keep records to provide evidence that the cardholder did not cancel the recurring payments plan in accordance with your policy. Or that the cardholder did not cancel at least 15 calendar days prior to the posting of the disputed card sale(s).

Reason

The cardholder is claiming that the amount of a card transaction was altered without their consent or direction.

Typical causes

• The system posted a different amount to the cardholder’s account.
• ATM dispensed an amount different from the amount charged to the account (less any set fees or service charges).
• Cardholder approved the amount for a cash advance or ATM transaction, but a different amount was dispensed/charged to the account.

Prevention steps

Keep records to either provide evidence of a credit or card sale in the correct amount issued to the account to correct the error or evidence that the cardholder is responsible for the disputed amount.

Reason

The cardholder is challenging the validity of the card transaction because the transaction should have resulted in a credit rather than a card sale or the transaction should have resulted in a card sale rather than a credit.

Typical causes

• The merchant processed a debit instead of a credit.
• The merchant processed a credit instead of processing a reversal.
• The merchant processed a transaction that differed from the obtained authorization.

Prevention steps

Keep records to provide either transaction documentation signed by the cardholder indicating agreement to the transaction, a transaction receipt or other record that indicates the transaction was posted correctly, or evidence that a credit was issued to the account to correct the error as permitted by Discover’s Operating Regulations.

Reason

The cardholder is claiming that a single card transaction was applied more than once to the account.

Typical causes

• The merchant tried to submit multiple batches at one time.
• The transaction had multiple receipts.
• The transaction was duplicated in the merchant’s system.
• The transaction was processed but the cardholder paid for the same merchandise or service by other means.

Prevention steps

Keep records to provide separate transaction documentation, either signed or authorized by the cardholder for the amount of each transaction, or evidence that you or the acquirer issued a credit(s) for each duplicate card sale, as applicable and permitted by Discover’s Operating Regulations.

Reason

The requested sales receipt was provided, but was not legible.

Typical causes

• The receipt is unreadable due to light ink, ribbed or colored paper, or fading.
• The original order receipt was mishandled or was scanned at a smaller size.

Prevention steps

• If the Transaction Documentation is required to display a Card print or issuer cannot receive the card transaction amount from the cardholder for any reason.
• The merchant bank may submit the Card Sale on the correct Card Number in the resolve of the Dispute.
• The issuers may receive Invalid Card Number Disputes during the times stipulated.

Reason

The cardholder is claiming that an ATM Cash Disbursement was charged to an account, but cash was not dispensed by the ATM.

Typical causes

The cardholder did not receive the full cash withdrawal at an ATM.

Prevention steps

• Keep records to provide evidence that the cardholder received cash or show that you have issued a credit to the account to correct the error where permitted.
• Reconcile ATMs in a timely manner.
• Adjust any out of balance machines promptly.
• In case of a discrepancy, process a credit or reversal as soon as possible.

Reason

The cardholder is claiming that their account was charged for a card sale where the transaction was conducted using another form of payment.

Typical causes

• The cardholder was charged for a transaction that was processed using an alternate form of payment.
• The merchant did not void multiple transactions.

Prevention steps

• Keep records to prove that a credit(s) has been issued to the account for the amount(s) subject to dispute, or supply transaction documentation signed by the cardholder indicating agreement to the card sale.
• Double check calculations, transaction amounts, and payment type before processing.
• Void any transactions if the cardholder wishes to use a different payment method.

Reason

The cardholder is challenging the validity of a transaction due to non-receipt of goods or services.

Typical causes

• The merchant delayed delivery.
• The merchant charged the cardholder before shipping or delivery.
• The merchant shipped on time or had the product available for pick-up but did not inform the customer.
• The cardholder is fraudulently claiming the goods or service did not arrive.

Prevention steps

• Keep records to provide proof, such as receipts, work orders, signed documents, and proof of delivery, to display that the goods or services were delivered by you as directed by the cardholder.
• You can also keep records of the written correspondence between you and the cardholder to provide the receipt of goods or services.

Reason

The cardholder is claiming that the goods or services delivered by the merchant were not of the quality or condition agreed-upon.

Typical causes

• The merchandise was damaged upon its arrival.
• The merchandise does not match the merchant’s description.
• The cardholder is disputing the quality of the product.
• The cardholder is fraudulently claiming the merchandise is damaged.

Prevention steps

• Keep records to prove that the cardholder approved of the quality of the goods or services at the time of the transaction, either through signed documentation or written correspondence.
• If applicable, you can also show that your attempts to correct the cardholder’s issues have been rejected.
• Alternatively, show that the cardholder never cancelled or rejected the goods and maintains possession of them.
• In addition, you can provide the terms agreed upon with the cardholder refuting the allegation of misrepresentation.

Reason

The cardholder is claiming that an expected credit from the merchant was not received.

Typical causes

• The cardholder refused delivery of goods or services and has not received a credit.
• The cardholder returned goods and received a promise of credit that was not received.
• The merchant does not accept returns.

Prevention steps

• Keep records to provide evidence that shows why a credit is not due to the cardholder as stated in agreed upon terms and conditions or return policies.
• Show that you have issued an in store credit or correction to their account to address the dispute.
• Process all credit vouchers promptly.
• Properly disclose special refund policies on the sales draft in prominently near the cardholder’s signature.
• Consider updating returns policy.

Reason

The acquirer or merchant did not comply with the applicable Operating Regulations.

Typical causes

• Failure to provide supporting documents relating to the underlying card transaction to Discover within the specified time limit.
• Non-compliance with the Operating Regulations applicable to the merchant or acquirer.
• Delays in providing requested documentation, leading to potential Dispute Compliance claims.

Prevention steps

• Be aware of and follow the Operating Regulations relevant to your sector and card networks you are dealing with.
• Provide requested documentation promptly to avoid Dispute Compliance claims.