6 Chargeback Reason Codes Categories Businesses Must Know to Protect Revenue

Comprehensive chargeback code knowledge that prevents revenue loss

Every business that accepts card payments will face chargebacks. However, understanding the specific reason codes behind each dispute determines whether you can successfully challenge them or need to accept the revenue loss.

These revenue losses compound when businesses expand globally without understanding how card networks like Visa, Mastercard, American Express and Discover categorise transaction disputes through their distinct reason code systems.

Chargeback reason codes are standardised identifiers that card networks assign to every disputed transaction. They explain why customers challenge charges and what evidence you need for successful dispute resolution.

Each major card network maintains a separate numbering system with a different categorisation approach.

This reference guide covers the six main chargeback reason code categories for all major card networks to help you identify dispute types quickly and respond with appropriate documentation.

Codes Category #1: Fraud and Unauthorised Transaction Codes

Fraud-related chargebacks are the highest-risk category for businesses, occurring when legitimate cardholders discover unauthorised transactions on their statements and contact their banks to dispute charges they didn’t make or authorise.

Each major card network assigns specific codes to different types of fraudulent activity, from counterfeit card usage to card-not-present fraud.

Visa assigns fraud codes in the 10.x series to cover different types of unauthorised transactions:

• 10.1 – EMV liability shift counterfeit fraud: Counterfeit card used at chip-enabled terminal where merchant liable for fraud
• 10.2 – EMV liability shift non-counterfeit fraud: Legitimate card used fraudulently at non-chip terminal
• 10.3 – Other fraud: card-present environment: Fraudulent transaction in face-to-face environment
• 10.4 – Other fraud: card-absent environment: Fraudulent card-not-present transaction (online, phone, mail order)
• 10.5 – Visa fraud monitoring program: High-risk merchant flagged for excessive fraud rates

Mastercard uses specific four-digit codes to identify various types of fraud and unauthorised activity:

• 4837 – No cardholder authorisation: Transaction processed without valid cardholder authorisation
• 4863 – Cardholder does not recognise: Cardholder doesn’t recognise transaction on statement
• 4870 – Chip liability shift: Counterfeit card fraud where chip card used at non-chip terminal
• 4871 – Chip/PIN liability shift: Lost/stolen chip card used without PIN verification
• 4834 – Duplicate processing: Same transaction processed multiple times
• 4808 – Authorisation-related chargeback: Transaction exceeds floor limit without authorisation

American Express uses alphanumeric codes beginning with “F” for fraud-related disputes:

• F10 – Missing imprint: Card imprint not obtained for card-present transaction
• F14 – Multiple ROCs: Multiple Records of Charge submitted for same transaction
• F24 – No card member authorisation: Transaction processed without cardholder authorisation
• F29 – Card not present: Fraudulent card-not-present transaction
• F30 – EMV counterfeit: Counterfeit card used at chip-enabled terminal
• F31 – EMV lost/stolen: Lost or stolen card used at chip terminal

Discover assigns UA codes to unauthorised transaction disputes:

• UA01 – Fraud: card present transaction: Fraudulent transaction with card physically present
• UA02 – Fraud: card not present transaction: Fraudulent online, phone, or mail-order transaction
• UA32 – Fraud: no cardholder authorisation: Transaction processed without cardholder consent
• UA03 – Fraud: altered amount: Transaction amount altered after cardholder authorisation
• UA10 – Request transaction receipt: Missing transaction documentation for fraud investigation
• UA11 – Cardholder claims fraud: General fraud claim by cardholder

Documentation wins fraud disputes when prevention fails. Keep transaction logs, IP addresses, delivery confirmations and customer communications. However, remember that preventing fraud costs less than fighting chargebacks.

Codes Category #2: Authorisation and Declined Transaction Codes

Authorisation-related chargebacks occur when banks claim transactions were processed without proper approval or when authorisation procedures weren’t followed correctly. These disputes arise from insufficient funds, expired cards or exceeded authorisation amounts.

Visa uses 11.x series codes for authorisation-related disputes:

• 11.1 – Card recovery bulletin: Transaction processed on card listed in recovery bulletin
• 11.2 – Declined authorisation: Transaction processed after authorisation was declined
• 11.3 – No authorisation: Transaction processed without obtaining authorisation
• 11.4 – Authorisation non-compliance: Authorisation obtained but transaction doesn’t comply with authorisation terms
• 11.5 – Transaction not recognised: Issuer doesn’t recognise transaction details in authorisation request

Mastercard assigns several four-digit codes to authorisation problems:

• 4808 – Authorisation-related chargeback: Multiple authorisation issues including insufficient funds
• 4834 – Point of interaction error: Duplicate processing or other terminal errors
• 4840 – Fraudulent processing of transactions: Processing transactions knowing card was fraudulent
• 4842 – Late presentment: Transaction submitted for processing after required timeframe
• 4846 – Correct transaction currency code required: Incorrect currency code used in processing
• 4847 – Exceeds floor limit: Transaction amount exceeds merchant’s floor limit without authorisation
• 4849 – Questionable merchant activity: Merchant processing appears suspicious or fraudulent

American Express uses “A” codes for authorisation disputes:

• A01 – Charge amount exceeds authorisation: Final charge amount higher than authorised amount
• A02 – No valid authorisation: Transaction processed without proper authorisation
• A08 – Authorisation approval expired: Authorisation code expired before transaction processing
• A11 – Authorisation code not obtained: Required authorisation not obtained before processing
• A13 – Pre-authorisation not completed: Pre-authorisation process not properly completed

Discover assigns AA and IN codes to authorisation problems:

• AA01 – No authorisation obtained: Transaction processed without obtaining required authorisation
• AA02 – Declined authorisation: Transaction processed after authorisation request was declined
• AA03 – Authorisation non-compliance: Transaction doesn’t comply with authorisation requirements
• IN01 – Invalid card number: Transaction processed with invalid or incorrect card number
• IN02 – Invalid expiration date: Card expiration date invalid or transaction processed on expired card

Real-time authorisation monitoring identifies these issues before they escalate into costly disputes. High decline rates in specific markets signal trouble. Payment method failures indicate routing issues. Geographic patterns show where your authorisation logic needs improvement.

Watch for systemic problems. A spike in declines from one market indicates that something has changed. Currency issues, local banking problems or network issues all affect authorisation rates. Fix these fast. And be sure to work with a local acquirer wherever possible.

Codes Category #3: Processing Errors and Technical Issues Codes

Processing error chargebacks result from technical mistakes during transaction processing, including duplicate charges, incorrect amounts, currency conversion errors and system malfunctions that create transaction discrepancies.

Processing mistakes are covered by a family of chargeback codes.

Visa processing errors fall under the 12.x series codes:

• 12.1 – Late presentment: Transaction submitted after required processing timeframe
• 12.2 – Incorrect transaction code: Wrong transaction type code used in processing
• 12.3 – Incorrect currency: Transaction processed in wrong currency
• 12.4 – Incorrect account number: Wrong account number used in transaction processing
• 12.5 – Incorrect amount: Transaction amount differs from authorisation or receipt amount
• 12.6 – Duplicate processing: Same transaction processed multiple times
• 12.7 – Invalid data: Transaction contains invalid or corrupted data

Mastercard uses various four-digit codes to identify processing errors:

• 4831 – Transaction amount differs: Posted amount differs from authorised or receipt amount
• 4834 – Point of interaction error: Terminal or processing system error
• 4835 – Transaction not recognised: Transaction details don’t match cardholder records
• 4842 – Late presentment: Transaction submitted beyond required timeframe
• 4853 – Cardholder dispute: Various processing disputes not covered by other codes
• 4854 – Cardholder dispute not elsewhere classified: Processing disputes not fitting other categories
• 4855 – Non-receipt of merchandise: Goods or services not received by cardholder

American Express assigns “C” codes to processing and service errors:

• C02 – Credit not processed: Expected credit or refund not processed to cardholder account
• C04 – Goods/services returned: Merchandise returned but credit not processed
• C05 – Goods/services cancelled: Services cancelled but charges not reversed
• C08 – Goods/services not received: Cardholder didn’t receive purchased goods or services
• C14 – Paid by other means: Cardholder paid through alternative method but still charged
• C18 – “No show” or CARDeposit: Hotel or rental no-show charges disputed
• C28 – Cancelled recurring billing: Recurring charges continued after cancellation request

Discover uses DP and IN codes for processing errors:

• DP01 – Duplicate processing: Transaction processed multiple times
• DP02 – Correct transaction currency required: Incorrect currency used in processing
• DP03 – Late presentment: Transaction submitted after deadline
• DP04 – Incorrect transaction amount: Amount processed differs from authorisation
• DP05 – Transaction not recognised: Transaction details don’t match cardholder records
• IN03 – Invalid transaction date: Transaction date invalid or outside acceptable range

Customers often dispute duplicate charges immediately. This requires you to provide detailed transaction logs that prove legitimate, separate purchases or acknowledge processing errors.

Your technical infrastructure directly determines processing error rates. API-driven payment processing gives you better control and error handling compared to manual methods. Most technical chargebacks signal system problems you can fix permanently.

When processing errors do occur, acknowledge them quickly and issue immediate refunds.

Codes Category #4: Consumer Disputes and Service-Related Codes

Service-related chargebacks occur when customers claim they didn’t receive purchased goods or services, received defective products or experienced significant delivery delays. These codes require businesses to provide proof of delivery, service completion or customer satisfaction.

Visa consumer disputes use the 13.x series for service-related issues:

• 13.1 – Services not provided: Services paid for but not received by cardholder
• 13.2 – Cancelled recurring transaction: Recurring billing continued after cancellation
• 13.3 – Not as described: Merchandise or services significantly different from description
• 13.4 – Counterfeit merchandise: Goods received are counterfeit or replica items
• 13.5 – Misrepresentation: Merchant misrepresented goods, services or terms
• 13.6 – Credit not processed: Expected refund or credit not applied to account
• 13.7 – Cancelled merchandise: Goods cancelled but charges not reversed

Mastercard applies multiple codes to various consumer dispute scenarios:

• 4853 – Cardholder dispute: General consumer dispute not elsewhere classified
• 4854 – Cardholder dispute not elsewhere classified: Various consumer disputes
• 4855 – Goods or services not provided: Non-receipt of merchandise or services
• 4857 – Card activated telephone transaction: Disputed telephone transaction
• 4859 – Addendum, no-show or ATM dispute: Hotel no-show or ATM disputes
• 4860 – Credit not processed: Refund or credit not processed to cardholder account
• 4862 – Counterfeit transaction magnetic stripe POS fraud: Counterfeit card used at POS
• 4863 – Cardholder does not recognise: Transaction not recognised by cardholder

American Express uses “C” and “R” codes for consumer service disputes:

• C08 – Goods/services not received: Purchased items or services not delivered
• C14 – Paid by other means: Payment made through alternative method but still charged
• C18 – “No show” or CARDeposit: Disputed hotel or car rental charges
• C28 – Cancelled recurring billing: Recurring charges after cancellation
• C31 – Goods/services not as described: Items significantly different from description
• C32 – Goods/services damaged or defective: Merchandise received in damaged condition
• R03 – Insufficient reply: Merchant response to inquiry inadequate
• R13 – No reply: Merchant failed to respond to cardholder inquiry

Discover assigns C and RG codes to consumer disputes:

• C2 – Credit not processed: Expected credit or refund not received
• C4 – Goods/services returned or refused: Items returned but credit not processed
• C5 – Goods/services cancelled: Services cancelled but charges remain
• C8 – Goods/services not received: Non-delivery of purchased goods or services
• C14 – Paid by other means: Alternative payment made but card still charged
• RG01 – Non-receipt of requested item: Specific requested items not received
• RG02 – Non-receipt of information: Required information not provided by merchant

Your customer service quality determines whether problems become chargebacks. Responsive support teams prevent disputes by solving issues directly. Flexible refund policies cost less than formal chargeback processes. Addressing customer concerns immediately saves more money than fighting disputes later.

Service-related chargebacks often indicate operational problems rather than fraudulent disputes. Fix the underlying service issues and these chargebacks decrease naturally.

Codes Category #5: Card-Not-Present (CNP) and Online Transaction Codes

Card-not-present chargebacks apply specifically to transactions where the physical card wasn’t present during processing, including online purchases, phone orders and mail-order transactions. These codes address authentication issues and verification failures unique to remote transactions.

Visa applies specific codes to online and remote transaction disputes:

• 10.4 – Other fraud: card-absent environment: CNP fraud where cardholder didn’t authorise
• 13.1 – Services not provided: CNP services not delivered as promised
• 13.2 – Cancelled recurring transaction: CNP subscription not properly cancelled
• 13.6 – Credit not processed: CNP refund not applied to cardholder account
• 12.3 – Incorrect currency: CNP transaction processed in wrong currency
• 12.4 – Incorrect account number: Account details don’t match cardholder information

Mastercard uses various codes for card-not-present transaction disputes:

• 4837 – No cardholder authorisation: CNP transaction without cardholder consent
• 4840 – Fraudulent processing of transactions: Knowing processing of fraudulent CNP transaction
• 4847 – Exceeds floor limit: CNP transaction exceeds limit without authorisation
• 4849 – Questionable merchant activity: Suspicious CNP merchant processing patterns
• 4853 – Cardholder dispute: Various CNP disputes not elsewhere classified
• 4863 – Cardholder does not recognise: CNP transaction not recognised
• 4871 – Chip/PIN liability shift: CNP transaction should have used chip authentication

American Express assigns specific codes to remote transaction disputes:

• F29 – Card not present: Fraudulent CNP transaction
• C08 – Goods/services not received: CNP purchase not delivered
• C31 – Goods/services not as described: CNP items different from online description
• A08 – Authorisation approval expired: CNP authorisation expired before processing
• A02 – No valid authorisation: CNP transaction without proper authorisation
• C28 – Cancelled recurring billing: CNP subscription charges after cancellation
• P01 – Unassigned card number: CNP transaction using invalid card number
• P03 – Credit processed as charge: CNP refund processed as additional charge

Merchant category code restrictions affect CNP transaction processing in highly regulated industries. Gaming, adult content and digital goods face additional verification requirements and higher chargeback risk. If your business is in these sectors, you need specialised payment processing that understands industry-specific chargeback patterns.

Digital goods create unique proof-of-delivery challenges since customers receive products immediately without physical shipping confirmation. You need alternative documentation methods: usage logs, download confirmations and account activity.

Finally, your authentication strategy needs geographic flexibility. Some markets require mandatory 3D Secure, others allow lighter verification. Balance security requirements with conversion rate optimisation for each market you serve.

Codes Category #6: International and Cross-Border Transaction Codes

International chargebacks involve additional complexity due to varying consumer protection laws, currency conversion issues and cross-border regulatory requirements. These codes address disputes specific to multi-currency transactions and international commerce regulations.

Visa applies various codes to international and cross-border transaction disputes:

• 12.3 – Incorrect currency: Transaction processed in wrong currency
• 12.6 – Duplicate processing: Same international transaction processed multiple times
• 10.4 – Other fraud: card-absent environment: International CNP fraud
• 13.6 – Credit not processed: International refund not applied properly
• 10.5 – Visa fraud monitoring program: High-risk international merchant flagged
• 11.4 – Authorization non-compliance: International transaction exceeds limits without authorization

Mastercard uses specific codes for cross-border transaction issues:

• 4846 – Correct transaction currency code required: Wrong currency code in international processing
• 4849 – Questionable merchant activity: Suspicious international merchant patterns
• 4850 – Instalment billing dispute: International instalment payment disputes
• 4853 – Cardholder dispute: International transaction disputes not elsewhere classified
• 4859 – Addendum, no-show or ATM dispute: International travel-related disputes
• 4863 – Cardholder does not recognise: International transaction not recognised
• 4870 – Chip liability shift: International counterfeit card liability
• 4871 – Chip/PIN liability shift: International lost/stolen card liability

American Express assigns “P” and “C” codes to international transaction disputes:

• P05 – Incorrect charge amount: International transaction amount discrepancy
• P07 – Late submission: International transaction submitted beyond deadline
• P08 – Duplicate charges: Multiple processing of international transaction
• P22 – Non-matching card number: International transaction card details mismatch
• C02 – Credit not processed: International refund not applied
• C31 – Goods/services not as described: International purchase description mismatch
• F10 – Missing imprint: International card-present transaction missing documentation
• R03 – Insufficient reply: Inadequate response to international dispute inquiry

Discover applies various codes to international commerce disputes:

• DP02 – Correct transaction Currency Required: International currency processing error
• IN01 – Invalid card number: International transaction with incorrect card details
• IN02 – Invalid expiration date: International transaction with wrong expiry date
• UA02 – Fraud: Card Not Present Transaction: International CNP fraud
• C8 – Goods/services not received: International purchase not delivered
• RG01 – Non-receipt of requested item: International order items not received
• AA01 – No authorisation obtained: International transaction without authorisation
• DP03 – Late presentment: International transaction submitted after deadline

International expansion works better with a payment infrastructure designed for multi-jurisdiction operations rather than cobbling together separate relationships for each market.

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