Visa Chargeback Reason Codes: The Ultimate Merchant's Guide

As a former e-commerce store owner, I’ve dealt with some chargebacks that result from transactions that used Visa. I want to teach you what to expect from these reason codes.

I’ll explain the different reason codes in each category, what causes them, ways to prevent them, and evidence that you’ll need to provide for every dispute that arises from them.

Let’s explore some reason codes.

Key Takeaways

• As of 2024, all reason codes give customers 120 days to file a chargeback.
• Merchants have 20 days to respond to each reason code.
• Visa may bundle reason codes into a single dispute if customers dispute multiple transactions with the same vendor on a single account.
• Visa retired 22 of its legacy codes during the Visa Claims Resolution initiative.

1. Customer Disputes

Notes:

• Visa retired reason code 75 in April 2018.
• During the Visa Claims Revolution initiative, Visa updated some of its legacy reason codes [1].some text
  • I’ll specify which codes are updated throughout each section.
• * The Visa Claims Resolution bundles disputes if a cardholder disputes multiple transactions on the same account.some text
  • The seller can submit a single response to address the bundled reason codes.

I feel like an example is necessary for “bundling.”

If a customer bought several items from the same store and disputed those charges, the store could respond to all the disputes in one go. Rather than having to address each one separately. This saves a lot of time when dealing with chargeback disputes.

1. 13.1: Merchandise/Services Not Received

Description: Cardholder did not receive the purchased merchandise or services.

Causes:

• Non-delivery
• Late delivery
• Delivery to incorrect address
• Package theft
• Canceled order (prior to receipt)

Prevention: Ensure timely delivery to the correct address and provide tracking information.

Evidence:

• Transaction details
• Proof of delivery (tracking information, delivery confirmation)
• Logs of communication with the shopper regarding delivery.

Legacy Code: 30

2. 13.2: Canceled Recurring Transaction

Description: The customer claims a recurring transaction was processed after cancellation or account closure.

Causes:

• Seller processing transaction after cancellation request
• Merchant ignoring account closure
• Misunderstanding cancellation terms

Prevention:

• Honor cancellation requests promptly.
• Clearly communicate cancellation terms and deadlines.
• Verify account status before processing recurring transactions.

Evidence:

• Transaction details
• Cancellation request records
• Communication records regarding cancellation
• Proof that cancellation terms were clearly communicated.

Legacy Code: 41

3. 13.3: Not as Described or Defective Merchandise/Services

Description: The received merchandise/services were not as described or were defective.

Causes:

• Item not matching description/pictures
• Damaged/defective product
• Lower quality than advertised
• Incorrect item shipped

Prevention:

• Provide accurate product descriptions and images.
• Ensure quality control before shipping.
• Offer clear return/exchange policies.

Evidence:

• Transaction details
• Product description/images from the time of purchase
• Proof of quality control (if applicable)
• Return/exchange policy documentation
• Communication logs regarding the issue

Legacy Code: 53

4. 13.4: Counterfeit Merchandise

Description: The merchandise received was counterfeit or an unauthorized replica.

Causes:

• Unknowingly sold counterfeit goods.
• Merchant intentionally sold counterfeit goods.
• The shopper falsely claims merchandise is counterfeit (friendly fraud).

Prevention:

• Source merchandise from reputable suppliers.
• Authenticate merchandise before selling.
• Implement strict quality control measures.

Evidence:

• Transaction details
• Proof of purchase from a reputable supplier (invoices, receipts)
• Authenticity certificates or documentation
• Expert opinions or appraisals confirming authenticity
• Communication logs
• Any evidence disputing the shopper’s claim of counterfeit merchandise

5. 13.5: Misrepresentation

Description: The vendor misrepresented the product, service, or terms of the sale.

Causes:

• Inaccurate or misleading product descriptions
• False advertising or claims
• Hidden fees or terms
• Misleading return/refund policies
• Bait-and-switch tactics

Prevention:

• Ensure accurate and transparent product/service descriptions.
• Clearly disclose all terms, conditions, and fees upfront.
• Avoid misleading or exaggerated claims.
• Offer clear and fair return/refund policies.

Evidence:

• Transaction details
• Accurate product/service descriptions and terms from the time of purchase
• Marketing materials, advertisements, or website screenshots
• Proof of clear fee disclosure
• Return/refund policy documentation
• Communication logs

6. 13.6: Credit Not Processed

Description: A credit or refund was not processed after a return or cancellation.

Causes:

• Merchant error in processing the refund
• Processing delays
• Miscommunication about refund status
• Cardholder misunderstanding of refund timeframe

Prevention:

• Process refunds promptly and accurately.
• Communicate refund status and estimated processing times to the consumer.
• Provide clear refund policies.

Evidence:

• Transaction details
• Proof of credit/refund (refund receipt, transaction reversal)
• Communication logs
• Refund policy documentation

Legacy Code: 85

7. 13.7: Canceled Merchandise/Services

Description: The customer claims they canceled a service or returned merchandise but did not receive the appropriate credit.

Causes:

• Merchant failed to process the cancellation or return.
• Seller processed the cancellation or returned late.
• Vendor did not issue a refund.
• Miscommunication regarding cancellation/return terms.

Prevention:

• Promptly process cancellations and returns.
• Issue refunds promptly upon return or cancellation.
• Clearly communicate cancellation and return policies.
• Confirm with the shopper/user that the cancellation or return has been processed.

Evidence:

• Transaction details
• Proof of cancellation (email, communication logs)
• Proof of return (return shipping label, tracking information)
• Refund confirmation or documentation of credit issued
• Communication logs

8. 13.8: Original Credit Transaction Not Accepted

Description: The issuing bank did not accept the original credit transaction, resulting in the funds not being credited to the account holder.

Causes:

• The cardholder did not accept the credit.
• The issuer cannot accept the transaction due to local laws.

Prevention:

• Ensure the shopper is aware of and accepts the credit transaction.
• Verify that the issuer's local laws allow for original credit transactions.

Evidence:

• Documentation proving the credit transaction was reversed (if applicable).
• Documentation proving the customer no longer disputes the transaction (if applicable).
• Communication logs.

9. 13.9: Non-Receipt of Cash or Load Transaction Value

Description: The cardholder claims they did not receive the full amount of cash or load value from an ATM or load transaction.

Causes:

• ATM malfunction
• Error in loading funds onto a prepaid card
• Friendly fraud (claiming they didn't receive cash when they did)

Prevention:

• Regular ATM maintenance and reconciliation
• Ensure accurate processing of load transactions

Evidence:

• ATM transaction logs or video footage showing cash disbursement
• Load transaction records showing successful completion
• Any evidence disputing the shopper’s claim of non-receipt

2. Fraud

Notes:

• Visa used to have reason codes 57, 62, 81, 83, and 93, but apparently condensed these “legacy” codes into codes above as a part of their Visa Claims Resolution (VCR) initiative.

1. 10.1: EMV Liability Shift Counterfeit Fraud

Description: A fraudulent transaction made with a counterfeit EMV (chip) card.

Causes:

• Counterfeit card
• Non-EMV compliant terminal (Merchant failed to use a chip reader for a chip card)

Prevention: Upgrade to EMV-compliant terminals and use them for all chip card transactions.

Evidence for Merchant:

• Transaction details
• Proof of authorization (e.g., signed receipt or PIN verification)
• Evidence of EMV compliance (terminal logs or transaction data showing chip read)
• Any documentation demonstrating the card was present during the transaction.

2. 10.2: EMV Liability Shift Non-Counterfeit Fraud

Description: A fraudulent transaction made with a legitimate EMV (chip) card.

Causes:

• Lost or stolen card
• Cardholder data compromise
• Non-EMV compliant terminal (Merchant failed to use a chip reader for a chip card)
• PIN bypass

Prevention: Upgrade to EMV-compliant terminals, verify card security codes, and train staff to identify suspicious behavior.

Evidence for Merchant:

• Transaction details
• Proof of account holder authorization (e.g., signed receipt or PIN verification)
• Evidence of EMV compliance (terminal logs or transaction data showing chip read)

3. 10.3: Other Fraud — Card-Present Environment

Description: An unauthorized transaction occurred in a card-present environment (e.g., at a physical store).

Causes:

• Merchant error (e.g., incorrect amount charged)
• Fraudulent use of a stolen or lost card
• Cardholder doesn't recognize the transaction

Prevention:

• Verify card security codes and the card owner’s identification.
• Use EMV-compliant terminals for chip card transactions.
• Provide clear transaction details on receipts.

Evidence for Merchant:

• Transaction details
• Proof of authorization (e.g., signed receipt, PIN verification)
• Evidence the card was physically present during the transaction

4. 10.4: Other Fraud — Card-Absent Environment

Description: An unauthorized transaction occurred in a card-absent environment (e.g., online).

Causes:

• Stolen card information
• Identity theft
• Account takeover
• Phishing scams

Prevention:

• Use strong fraud prevention tools (e.g., 3D Secure, AVS)
• Monitor transactions for suspicious activity
• Verify customer information for high-risk orders

Evidence for Merchant:

• Transaction details
• Proof of authorization (e.g., AVS match, CVV match)
• Evidence of delivery or service fulfillment
• Communication logs

5. 10.5: Visa Fraud Monitoring Program

Description: Visa has identified the transaction as fraudulent through their internal monitoring program.

Causes:

• Fraudulent activity detected by Visa's systems
• Merchant's fraud rate exceeds Visa's threshold

Prevention:

• Maintain a low fraud rate by implementing robust fraud prevention measures.
• Regularly review and update fraud prevention strategies.
• Evidence for Merchant:

Transaction details: Any evidence disputing Visa's fraud determination (e.g., proof of authorization or cardholder confirmation)

3. Processing Errors

1. 12.1: Late Presentment

Description: A recurring transaction was not canceled as requested.

Causes: Merchant error (failure to cancel, billing after cancellation)

Prevention: Implement a system to track and manage recurring billing accurately.

Evidence for Merchant: Proof that the recurring transaction was canceled according to the cardholder's request (e.g., cancellation confirmation email, system logs)

2. 12.2: Incorrect Transaction Code

Description: The seller processed a transaction using an incorrect code (e.g., processed a credit as a sale).

Causes: Merchant error (inputting the wrong transaction code)

Prevention: Ensure employees are trained on correct transaction code entry and implement systems to verify code accuracy.

Evidence for Merchant:

• Transaction details
• Proof that the correct transaction code was used (e.g., system logs, receipts)

3. 12.3: Incorrect Currency

Description: The transaction was processed in the wrong currency.

Causes:

• Merchant error (selecting the wrong currency)
• System error (misconfiguration of currency settings)

Prevention: Verify the correct currency is selected before processing transactions and ensure systems are configured correctly.

Evidence for Merchant:

• Transaction details
• Proof that the correct currency was used (e.g., system logs, receipts, currency conversion documentation)

4. 12.4: Incorrect Account Number

Description: The transaction was processed using an incorrect or invalid account number.

Causes:

• Merchant error (entering the wrong account number)
• Customer error (providing the wrong account number)
• System error (account number incorrectly transmitted or stored)

Prevention:

• Double-check account numbers before processing transactions
• Use systems that validate account numbers
• Encourage account holders to verify their information

Evidence for Merchant: Proof of the correct account number used (e.g., signed receipt, customer record)

5. 12.5: Incorrect Amount

Description: The shopper claims they were charged an incorrect amount for a transaction.

Causes:

• Merchant error (inputting the wrong amount, duplicate processing)
• Consumer misunderstanding (e.g., not accounting for taxes or fees)

Prevention:

• Ensure accurate pricing and clearly display all charges
• Implement systems to check for duplicate transactions
• Provide detailed transaction information on receipts

Evidence for Merchant:

• Transaction details (including timestamps)
• Proof of the correct amount charged (e.g., signed receipt, invoice)

6. 12.6.1: Duplicate Processing

Description: The cardholder was charged more than once for the same transaction.

Causes:

• Merchant error (processing the same transaction multiple times)
• System error (technical glitch causing duplicate processing)

Prevention:

• Implement systems to detect and prevent duplicate transactions.
• Reconcile transactions regularly to identify and refund duplicates.
• Provide clear transaction details on receipts.

Evidence for Merchant:

• Transaction details for both transactions (including timestamps)
• Proof that only one transaction was intended (e.g., order confirmation, inventory records)

7. 12.6.2: Paid By Other Means

Description: The transaction was already paid using a different payment method.

Causes:

• Merchant error (processing the card transaction after payment was made by other means)
• Customer confusion (may not recall the other payment method used)

Prevention:

• Verify if payment was received by other means before processing the card transaction.
• Provide clear transaction details on all payment methods used.
• Maintain detailed records of all transactions and payments received.

Evidence for Merchant:

• Proof of payment by other means (e.g., cash receipt, check copy, other card transaction details)
• Transaction details for the disputed Visa transaction
• Any communication with the shopper regarding payment methods

8. 12.7: Invalid Data

Description: The transaction was processed with incorrect or invalid data.

Causes:

• Incorrect values for:some text
  • Merchant Category Code (MCC)
  • Transaction type indicator
  • Country or state code
  • "Special Condition" indicator
  • Transaction date

Prevention:

• Ensure accurate data entry for all transaction fields.
• Use systems to validate data before processing.
• Keep transaction data up-to-date.

Evidence for Merchant:

• Transaction details
• Proof of correct data used (e.g., system logs, receipts, merchant agreement with acquirer showing correct MCC)

4. Authorization

‍

‍

Notes:

• Visa used to have the legacy codes 70, 71, 72, and 73 before the Visa Claims Resolution Initiative.
• Point-of-interaction error legacy codes include: 74, 76, 77, 80, 82, 86.

1. 11.1: Card Recovery Bulletin

Description: A transaction was processed on a card listed on Visa's Card Recovery Bulletin (CRB), which indicates the card was reported lost, stolen, or compromised.

Causes:

• Merchant error (failing to check the CRB before processing)
• Friendly fraud (using a reported lost/stolen card)

Prevention:

• Always verify card status against the CRB, especially for high-value transactions.
• Use fraud prevention tools to identify suspicious transactions.

Evidence for Merchant:

• Transaction details (proving transaction was processed before the card was listed on the CRB)
• Evidence that authorization was obtained and the card was physically present during the transaction (if applicable)

2. 11.2: Declined Authorization

Description: The transaction was processed despite receiving a declined authorization from the issuer.

Causes:

• Operational error (processing a transaction after receiving a "decline" or "pick up card" response)
• System error (technical glitch causing a decline to be overridden)

Prevention:

• Never process transactions that receive a declined authorization.
• Implement systems to automatically decline transactions with invalid authorizations.
• Train staff on proper authorization procedures.

Evidence for Merchant: Transaction details (showing a valid authorization was obtained before processing)

3. 11.3: No Authorization

Description: The transaction was processed without obtaining a valid authorization from the issuer.

Causes:

• Merchant error (failing to obtain authorization before processing)
• Processing delays (authorizing the transaction too long after the initial request)
• Incorrect authorization amount (processing a different amount than authorized)

Prevention:

• Always obtain authorization before processing a transaction.
• Authorize transactions promptly and process them for the exact authorized amount.

Evidence for Merchant:

• Transaction details showing valid authorization obtained before processing (including authorization code and timestamp).
• Any documentation proving the customer was aware of and agreed to the transaction amount.

Finishing Up

Preventative measures for these reason codes will vary. Some require upgrading your software and hardware infrastructure. Others require changes within your standard operating procedures.

However, in some cases, preventative measures might not be good enough and can result in disputes.

Disputes don’t automatically mean you’ll face a chargeback, though. Our partnership with Visa Rapid Dispute Resolution (RDR) can help you stop disputes before they lead to chargebacks. Learn more.

Sources

• 1: Visa: Visa Claims Resolution