Understanding of MasterCard Chargeback Reason Codes
Now we are very familiar with the word ‘Chargebacks’ from the expert at Chargeback
Overview of Chargeback Reason Codes :
Each transaction or deal has a unique receipt no. or order no. When any Chargeback occurs, that will be identified by the specific code. These numeric codes are varied by card network but serve the same purpose. It specifies the cause of dispute between the issuer and the merchant. The merchant should see each Chargeback as a learning experience for future business deals. There
To apply for the Chargeback, the issuer must submit the First Chargeback or 1442 Message with the application Reason Code. Generally, the issuer can apply for the first chargeback for an applicable transaction within the decided time frame for the chosen Chargeback Services with Reason Code. Basically, the Chargeback time frame includes 180 days period.
Causes of Chargeback :
Let’s categorize Chargeback frauds by their three main causes – merchant error, criminal fraud and friendly fraud. The Chargeback Management System becomes more efficient by doing this categorization.
Codes Chargeback Reason
4801 Requested transaction data is not received
4802 Required information is illegal or missing
4808 Required authorization not obtained
4831 Transaction amount is different
4834 Duplicate order process
4835 Card is not valid or expired
4837 Fraud/No cardholder authorization
4840 Fraudulent transaction
4841/4850 Credit posted as purchase
4855 Nonreceipt of merchandise
4859 Service not rendered
4860 Credit not processed
4863 Cardholder does not recognize – Potential Fraud
4870/4871 Chip/PIN liability shift/ Counterfeit transaction
- Merchant error: There are several Chargeback related to merchant services than any other category and most of them are preventable. These errors are sorted by some of these codes: 4802, 4803, 4841, 4850, 4855, 4870, 4871 and many more. By doing best business practices and little extra efforts, any merchant will reduce chargebacks or profit loss.
- Criminal fraud: Unauthorized activity or criminal fraud is recognized as potential fraud and you should take the necessary steps to stop chargebacks. These frauds are sorted by codes: 4870, 4871, 4837, etc.
- Friendly
fraud : Mistreatment, neglect of customer requirement – these all chargeback abuse are done by known as friendly fraud. The fraud might have donenon hostile enemyaccidently , while the consumer set out withintention to get something free. These codes are : 4855, 4841, 4850, 4863, 4837, etc.
The management of chargeback is complex and difficult, but using management efforts, it may be reduced.