Mastercard’s Chargeback and Fraud-related Disputes

Similarly to Visa, Mastercard has also announced plans to eliminate fraud. At the same time, Mastercard is enhancing the chargeback process by making it easier and faster to handle fraud-related disputes (we have already published news about the Mastercard Dispute Resolution Initiative in one of our previous articles).

Improving the Mastercard’s chargeback and fraud-related disputes

Its objective is to improve the Mastercard dispute handling process by automatically detecting invalid disputes, shortening dispute resolution timeframes and updating some dispute reason codes and their conditions.

“TrustPay automatically represents all invalid chargebacks.”

One of such changes is that chargeback reason code 4863 (Cardholder Does Not Recognize—Potential Fraud) will be eliminated deleted from the revised chargeback rules on or after 17 April 2020. This means that the first chargebacks will no longer be allowed and will be invalid.

Already, TrustPay automatically represents all invalid chargebacks.

Other reason codes for fraud-related chargebacks

However, there are still other reason codes for fraud-related chargebacks. Therefore, it is good to remind you when some of these must not be processed at all.

A No Cardholder Authorization chargeback must not be processed for any of the following:

  • Authorization Approval after the Fraud Notification Service (FNS) Date
  • The issuer approved the transaction after submitting two or more chargebacks involving the same Mastercard card account for any of the following message reason codes: 4837, 4840, 4870, or 4871.
  • FNS Counter Exceeds 15 Fraud-Related Chargebacks. The issuer submitted more than 15 chargebacks in aggregate involving the same account.
  • Transactions resulting from an account takeover and subsequently reported to SAFE as such.
  • Correctly identified Mastercard.
  • Digital Goods less than or equal to USD 25. An e-commerce transaction that was less than or equal to USD 25 (or the local currency equivalent) for the purchase of digital goods resulted because the merchant did not offer purchasing control settings to the cardholder when the cardholder created an account with the merchant.

In case such chargeback falls through the Mastercard elimination tool TrustPay will detect it and represent it on your behalf.

Furthermore, you can increase your chance for successful chargeback representment by providing us with compelling evidence that supports your arguments about cardholder participation in the transaction.

Compelling Evidence for E-commerce Transactions

At least one of the following documents and, when necessary, an explanation is accepted by Mastercard as compelling evidence:

  • Copies of written correspondence exchanged between the merchant and the cardholder (such as letter or e-mail) showing that the cardholder participated in the transaction;
  • The initial transaction was a Digital Secure Remote Payment (DSRP) transaction or was SecureCode-initiated;
  • Description of the goods or services purchased in the initial transaction;
  • Date and authorization approval code for the initial transaction; and
  • The initial transaction was not disputed
  • When a merchant requires a cardholder to register prior to completing a purchase, the merchant must provide documentation confirming the cardholder or authorized user is registered to purchase goods with a password and must provide one or more of the following documentations:
    • The cardholder or authorized user completed other undisputed purchases before, or after, the alleged fraudulent transaction
    • The cardholder or authorized user completed the disputed transaction from a registered device and IP address
    • Details of the purchase
    • Signed proof of delivery
    • E-mail addresses to support digital download delivery
  • The cardholder or authorized user registered the disputed goods or services (for example, registration for purposes of warranty or future software updates).
  • The disputed goods or services used.
  • A fully enabled SecureCode transaction was used to register a PAN for a future transaction.

If you want to get more information regarding the Mastercard dispute resolution or want to learn more about successful chargeback representment, please, do not hesitate to contact us.


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