Chargeback Reason Codes

Under the proper circumstances, chargebacks are available from all credit card and debit card networks. But deadlines, requirements, and your chargeback dispute reasons are as varied as the chargeback reason codes that are used. So before you rush off and file a dispute with your bank, read the information below. It could save you a lot of trouble and simplify the chargeback process

       

What Role Do Reason Codes Play in the Chargeback Process?

Since chargeback disputes arise due to various reasons, there is a need to standardize the way they are reported so the bank can determine if a chargeback is justified. When you don’t agree to a charge on your account, it is not enough to simply demand your money back. 

When you submit a chargeback dispute request you have to select a “reason code.” The purpose of the codes is to make the chargeback process more efficient. Choosing a code is not always simple, because many chargeback disputes can look like they fit more than one reason code. Selecting the most appropriate one, therefore, is crucial for ensuring a positive outcome.

Many clients have come to us after having unsuccessfully attempted a chargeback dispute on their own. This is often because customers used the wrong reason code. They often unfortunately learn the hard way that they only had one chance at the chargeback process, and they lost it by picking a reason code that didn’t match their dispute. It’s just one more reason to rely on the experience and expertise of Rapidcoin before beginning the chargeback process. 

As a simple example, can you easily distinguish between Fraud and Goods or Services not Received? Or how about a Cardholder Dispute of a Recurring Transaction vs. a Cardholder Debited More than Once for the Same Goods or Services? Even an excellent grasp of the English language won’t help you when it comes to understanding and using the professional jargon of banks and credit card companies. 

Moreover, each card network publishes its own list of these codes and has its own way of stylizing them, so they are not interchangeable. Visa chargeback reason codes, for example, are numerals with decimals. Mastercard chargeback reason codes are four numerals without decimals. American Express, Discover (and Diners Club International, which it owns) use a combination of numerals and letters.

Nor is the situation static. Even learning all the terms and rules won’t keep you safe for long. From time to time, card networks update their reason codes and the definitions of what they precisely cover. These changes can sometimes be quite subtle, but often very significant. 

Rapidcoin keeps abreast of all reason code changes. We will ensure that your chargeback dispute is filed using the proper reason code that is valid when your paperwork is submitted to your bank.

Timetables for Chargeback Dispute Reason Codes

Similarly, card network chargeback calendars are not uniform either. And they also change, albeit at a much slower pace. In such cases, announcements are made far in advance.

What this means is that if you raised a chargeback dispute with your bank in the past, the relevant reason code and/or the timetable may now be different. And they are bound to be different in the event this new dispute involves a different credit card or debit card network. This is yet another reason why you should first consult with a chargeback professional, especially when the dispute involves a complex card-not-present transaction.

One potential complicating factor in the chargeback process is that for Visa and Mastercard, certain reason codes reduce the time a cardholder has to file for a chargeback. That is why, in the table below, different deadlines appear for the initial request. 

The Terminology of Chargeback Dispute Reason Codes

Quite often clients come to us after having used two or more credit cards or debit cards to transfer payments to a merchant. In such cases, we have to prepare each chargeback dispute separately, each with its own reason code and each according to its timetable. 

What our clients will discover is that card networks employ their own proprietary terminology throughout the chargeback process. Visa, for example, uses the term “dispute” while Mastercard uses “chargeback” (and to remain neutral we use both on this page and throughout this website).

This chart enables you to compare many of the chargeback filing requirements and deadlines of the major card networks. These deadlines, however, are not applicable in all situations. Each reason code is unique and specific ones have their own deadlines.

 

 

Network	Visa	Mastercard	American Express	Discover and Diners Club
Initial Chargeback Request	75 or 120 days from the last relevant transaction*	60, 90 or 120 days from the last relevant transaction*	120 days (with some flexibility)	No deadline
For Payments of Interrupted, Ongoing Services	540 days	540 days	As above	No deadline
Merchant’s Representment	30 days later	45 days later	20 days	20 days maximum
Cardholder’s Representment	Up to 30 days later	Up to 45 days later	None	30 days
Arbitration	Within 10 days	Within 8 days	None: Merchant has 20 days to appeal	Within 15 days

* Depending on the reason code cited.