5 - MasterCard

5.1 - Mastercard process

Mastercard has consolidated the reason codes into four main Dispute Categories:

4837 – Fraud
4808 – Authorization
4834 – Processing Error
4853 – Cardholder Dispute

The older reason codes may continue to be used, however, they will eventually be eliminated.

New MasterCard process

The Issuer raises a dispute (CHABAC) (Explanation for Transaction keys can be found in Chapter 7.1) The Acquirer sends a representment to the Issuer (REPR05) and either

The issuer accepts the case (CHBWON) or
The Issuer files a Pre-arbitration to the Acquirer (PREARB) and either
- The Acquirer accepts and funds are returned to the issuer (OUFE20, CBLOST)
- The Acquirer declines (PADECL)
  - The issuer evaluates the declined case and
    - Accepts the case (CBWON)
    - Or files an Arbitration case (ARBREW) to Mastercard if conditions are met.
      - Depending on the final ruling from Mastercard, the resolution of the case will be either
        
        Chargeback won (CHBWON) or
        
        Chargeback lost (CBLOST and OUFE20)

5.2 - MasterCard dispute conditions

MasterCard uses the following four main categories to organize its reason codes: Authorization (4808), Card Member Disputes (4853), Fraud (4837) and Processing Errors (4834).

An authorization-related chargeback may be submitted when one of the following has occurred:

Authorization was required but not obtained.
The primary account number (PAN) does not exist.
The authorization chargeback protection time period had expired for the presentment (meaning 7 days for final or undefined authorizations and 30 days for pre-authorizations) and one of the following:
- For a transaction occurring at a merchant located in the Europe Region, the account was permanently closed before the chargeback was processed
- For a transaction occurring at a merchant located in any other region, the issuer deemed the account not to be in good standing (a "statused" account) before filing the chargeback
A card-not-present authorization was declined by the issuer and subsequently approved through Stand-In processing or X-Code with an approval response as specified in the Mastercard Authorization Manual with the following exceptions:
- The issuer generated a decline response that included a value of 02 (Cannot approve at this time, try again later) in DE 48 (Additional Data—Private Use), SUBELEMENT 84 (Merchant Advice Code).
- The issuer generated an approval response after previously declining the transaction.
- The merchant can prove that the cardholder initiated the authorization request.

5.2.2 - 4834 Point of interaction error

A point-of-interaction error chargeback may be submitted when the cardholder contacted the issuer alleging one of the following:

The cardholder paid twice for the same transaction using two different forms of payment
The cardholder's account has been debited more than once for the same transaction using the same form of payment
The cardholder was billed an incorrect amount
Cash was not properly dispensed by an ATM
The cardholder's account has been debited more than once for the same ATM transaction
The cardholder was billed for loss, theft, or damage in the same transaction as the underlying initial service
A dispute regarding POI Currency Conversion (Dynamic Currency Conversion)
The cardholder was billed an unreasonable amount (Intra-EEA Transactions only)
The cardholder paid an improper merchant surcharge (intra-European and inter-European transactions only)
The merchant processed a credit (instead of a reversal) to correct an error which resulted in the cardholder experiencing a currency exchange loss. In addition, the issuer may use message reason code 4834 when the acquirer presented a transaction past the applicable time frame.

5.2.3 - 4853 Cardholder Dispute

A Cardholder Dispute chargeback may be submitted when the cardholder contacted the issuer alleging one of the following:

Goods or services were either not as described or defective, including shipped merchandise was received damaged or not suitable for its intended purpose as well as the merchant didn't honour the terms and conditions of a contract
Goods or services were not provided
Digital goods were purchased totalling USD 25 or less and did not have adequate purchase controls
Credit not processed
Counterfeit goods alleged to be authentic were purchased
Recurring transaction cancelled prior to billing
Addendum dispute or "no-show" hotel charge was billed
Purchase transaction did not complete
Timeshare agreement or similar service provision was cancelled within Mastercard time frame
Credit posted as a purchase

For purposes of the chargeback Standards, the following message reason codes are deemed to be fraud-related.

4837 — No Cardholder Authorization
4849 — Questionable Merchant Audit program
4870 - Chip Liability Shift
4871 - Chip Liability Shift—Lost/Stolen/Never Received Issue (NRI) Fraud

5.2.5 - 4842 Late presentment

This message reason code may be used by the issuer when the following chargeback conditions have been met:

The account is permanently closed.
The issuer used good-faith efforts to collect the transaction amount from the cardholder.
The transaction was not presented within one of the following time frames:
- When the transaction was completed with electronically recorded card information (whether card-read or key-entered), the acquirer has a maximum of seven calendar days after the transaction date to present the transaction to the issuer.
- When the transaction was completed with manually recorded card information (whether imprinted or handwritten), the acquirer has a maximum of 30 calendar days after the transaction date to present the transaction to the issuer.
- A Payment Transaction must be presented in clearing within one business day of the authorization date.
- A contactless transit aggregated transaction must be presented in clearing within 14 calendar days of the authorization date.
- Effective for transactions occurring on or after 17 July 2020, a refund transaction must be presented in clearing within five calendar days of the transaction date. For a refund transaction, the transaction date is the date on which the merchant agreed to provide a refund to the cardholder (the refund transaction receipt date, or if the refund transaction was authorized by the issuer, then the refund transaction authorization date).

These time frames are defined as the time between the transaction date and the Central Site Business Date. When calculating the number of days, consider the transaction date as day zero.
An issuer must accept a transaction submitted beyond the applicable time frame when the account is in good standing or the transaction can be honored.

5.3 - Supporting documents needed for a valid representment

5.3.1 - Mastercard Table

Category	RC	Comment	Document required
4808 Authorization-related Chargeback (Reason codes 4804, 4807 and 4812 will eventually be eliminated)	4804	Multiple Processing	Merchant must provide separate transaction receipts or other record/details to prove that two separate transactions were processed.
4808 Authorization-related Chargeback	4807	Warning Bulletin	Acquirer will evaluate whether chargeback is valid or not.
4808 Authorization-related Chargeback	4808	Authorization-related Chargeback	Evidence that the transaction was authorized by the issuer.
4808 Authorization-related Chargeback	4809	Transaction not reconciled	Acquirer will evaluate whether chargeback is valid or not.
4808 Authorization-related Chargeback	4811	Stale Transaction	Acquirer will evaluate whether chargeback is valid or not.
4808 Authorization-related Chargeback	4812	Account Number Not on File	Evidence that the transaction was authorized by the issuer.
4834 Point of interaction error (Reason codes 4831, 4842, 4846 and 4859 will eventually be eliminated)	4831	Transaction Amount Differs	Merchant must provide evidence that the transaction amount was correct.
4834 Point of interaction error	4834	Cardholder Debited More than Once for the Same Goods or Services	The documentation must clearly establish that the cardholder was not debited more than once for the same goods or services.
4834 Point of interaction error	4834	Duplicate Processing	Merchant must provide separate transaction receipts or other record/details to prove two separate transactions were processed.
4834 Point of interaction error	4834	Paid by Other Means	Evidence to prove that the Merchant did not receive payment by other means for the same merchandise or service.
4834 Point of interaction error	4842	Late Presentment	Merchant must provide evidence of transaction receipt with transaction date that disproves late presentment.
4834 Point of interaction error	4846	Currency related dispute	Merchant must provide evidence that currency was correct.
4834 Point of interaction error	4846	POI Currency Conversion (Dynamic Currency Conversion)	This second presentment is not available for POI currency conversion disputes regarding the cardholder's agreement to the conversion. The acquirer should accept the chargeback and process a new First Presentment/sale message with the correct currency.
4834 Point of interaction error	4859	Cash was not properly dispensed by an ATM	ATM log showing that cash was properly dispensed for both transactions. ATM log needs to show the transaction before the disputed transaction as well as the one after it.
4834 Point of interaction error	4859	The cardholder was billed for loss, theft, or damage in the same transaction as the underlying initial service (for ex. car rental or hotel stay)	Proof that the service was billed separately from the loss, theft or damage and specifically authorized by the cardholder.
4853 Cardholder Dispute (Reason codes 4841, 4855 and 4860 will eventually be eliminated)	4841	Issuer Dispute of a Recurring Transaction	Proof that the transaction was not a recurring transaction. Cardholder failed to meet the cancellation terms of a signed contract. Proof that the cardholder is still using services after cancellation. Proper disclosure of entering into a recurring transaction was provided to and accepted by cardholder.
4853 Cardholder Dispute	4841	Digital Good Purchases for EUR 25 or less	Proof that purchase control was offered to cardholder.
4853 Cardholder Dispute	4853	Defective/Not as described	Prove that the merchandise or service was as described (must be the same as described on the original transaction receipt or accompanying sales documents). Merchant did not receive the returned merchandise or has evidence to show that the cardholder did not attempt to return the merchandise. Merchandise was not defective (proof).
4853 Cardholder Dispute	4853	Counterfeit Goods	Merchant can submit a dispute response with evidence that merchandise was not counterfeit
4853 Cardholder Dispute	4853	Credit Not Processed	Provide documentation of the credit or reversal; include the amount and the date it was processed or provide proof that credit was not due
4853 Cardholder Dispute	4853	Goods or Services Not Provided	Proof of delivery, tracking number and carrier and a screenshot of the carrier's delivery report with the address the merchandise was delivered to and customer's signature if available.
4853 Cardholder Dispute	4855	Goods or Services Not Provided	Proof of delivery, tracking number and carrier and a screenshot of the carrier's delivery report with the address the merchandise was delivered to and customer's signature if available. Proof that services have been used.
4853 Cardholder Dispute	4859	"No-Show" Hotel Charge	The transaction was the result of a "no show" as described in the Guaranteed Reservations.
4853 Cardholder Dispute	4859	Addendum Dispute	The merchant can substantiate that the addendum transaction is the cardholder's responsibility
4853 Cardholder Dispute	4859	Charges for Loss, Theft, or Damages	The merchant's explanation and documentation to proof cardholders acceptance
4853 Cardholder Dispute	4860	Credit Not Processed	Provide documentation of the credit or reversal; include the amount and the date it was processed or provide proof that credit was not due.
4853 Cardholder Dispute	4860	Credit posted as purchase	Cardholder's account is inaccurately debited instead of credited because of an incorrect transaction code. This chargeback should be for twice the original transaction amount to offset the error.
4853 Cardholder Dispute	4860	Timeshares	Provide all agreements and communication with the cardholder.
4837 Fraud related chargeback (Reason codes 4840, 4849 and 4863 will eventually be eliminated)	4837	Fraud related chargebacks	Proof of card presence (pin, signature, valid imprint). Evidence that all transactions occurred during the same stay, trip or rental period. Compelling evidence for cardholder participation, any personally identifiable information like name, address, email etc. All available communication with customer.
4837 Fraud related chargeback	4840	Fraudulent Processing of Transactions	This chargeback condition has been eliminated
4837 Fraud related chargeback	4849	Questionable Merchant Activity	Merchant has been listed as high risk on the Global Merchant Audit Program (GMAP). Acquirer will evaluate whether chargeback is valid or not.
4837 Fraud related chargeback	4863	Cardholder Does Not Recognize-Potential Fraud	This reason code was eliminated on 17 July 2020
4837 Fraud related chargeback	4870	Chip Liability Shift	Acquirer will evaluate whether the chargeback is valid or not based on the merchant's terminal capability and the input of the card (how the card was read).
4837 Fraud related chargeback	4871	Chip Liability Shift—Lost/Stolen/Never Received Issue (NRI) Fraud	Acquirer will evaluate whether the chargeback is valid or not based on the merchant's terminal capability and the input of the card (how the card was read).

The merchant can provide specific documentation to attempt to support cardholder participation in a fraudulent transaction.

5.3.2.1 - Compelling Evidence for Airline Transactions

The merchant can provide specific documentation to support cardholder participation in the card not present Airline Transaction. At least one of the following documents must be provided and; when necessary, an explanation:

Flight ticket or boarding pass showing the passenger’s name.
Flight manifest showing the passenger’s name.
Additional transactions connected with the disputed flight, such as upgrades, excess baggage charges, and in-flight purchases.
Passenger identification documentation showing a link to the cardholder.
Credits of frequent flyer miles for the flight, showing connection to the cardholder.
Proof of receipt of the flight ticket at the cardholder’s billing address.

5.3.2.2 - Compelling Evidence for Recurring Transactions

The merchant can provide specific documentation to support cardholder participation in the card not present recurring transaction. All of the following must be provided:

A description of the goods or services being provided.
The start date of the original recurring transaction.
State which, if any, of the following was used in the original transaction:
1. SecureCode
2. Card validation code 2 (CVC 2)
One of the following:
1. The transaction was properly identified in both authorization and clearing as a recurring transaction.
2. Documentation proving that the transaction was recurring. Examples include but are not limited to: The merchant providing proof that the cardholder had to click to accept the recurring terms and conditions or the cardholder signed a contract agreeing to the recurring terms and conditions.

5.3.2.3 Compelling Evidence for E-commerce and MO/TO Transactions

The merchant can provide specific documentation to support cardholder participation in the card not present Airline Transaction. At least one of the following documents must be provided, and; when necessary, an explanation:

A receipt, work order, or other document signed by the cardholder substantiating that the goods or services were received by the cardholder (commonly referred to as “will call” and “in-store pickup”)
The cardholder’s written confirmation of registration to receive electronic delivery of goods or services
Copies of written correspondence exchanged between the merchant and the cardholder (such as letter, email, or fax) showing that the cardholder participated in the transaction.
A merchant statement documenting all of the following when, after completing an authenticated e-commerce transaction, the merchant obtained authorization for a related transaction involving a partial shipment or the payment of a balance due:
1. The initial transaction was a Digital Secure Remote Payment (DSRP) or initiated by 3DS
2. Description of the goods or services purchased in the initial transaction;
3. Date and authorization approval code for the initial transaction; and
4. 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 documentation:
1. The cardholder or authorized user completed other undisputed purchases prior to, or after, the alleged fraudulent transaction
2. The cardholder or authorized user completed the disputed transaction from a registered device and IP address
3. Details of the purchase
4. Signed proof of delivery
5. Email addresses to support digital download delivery
6. The cardholder or authorized user registered the disputed goods or services. For example, registration for purposes of warranty or future software updates
7. The disputed goods or services were used
8. A fully enabled SecureCode transaction was used to register a PAN for future transactions

5.4 - Mastercard Fraud report

5.4.1 - Mastercard Fraud reporting reason codes

Fraud Type Code	Description
00	Lost Fraud — A fraudulent transaction that occurs with the use of a lost credit or debit card (or other device accessing a credit or debit card account—for example, convenience checks) without the actual, implied, or apparent authority of the cardholder.
01	Stolen Fraud — A fraudulent transaction that occurs with the use of a stolen credit or debit card (or other device accessing a credit or debit card account—for example, convenience checks) without the actual, implied, or apparent authority of the cardholder.
02	Never Received Issue — The interception and use of a credit or debit card (or other device accessing credit or debit card account, for example, convenience checks) before receipt by the cardholder by a person without the actual, implied, or apparent authority of the cardholder.
03	Fraudulent Application - A fraudulent transaction that occurs with the use of a credit or debit card that was obtained with an application using a false name or other false identification information.
04	Counterfeit Card Fraud - The use of altered or illegally reproduced credit or debit card (or other physical device accessing a credit or debit card account, for example, convenience checks) including the replication or alteration of the magnetic stripe or embossing.
05	Account Takeover Fraud - An existing credit or debit account is used without the actual, implied, or apparent authority of the cardholder, by a person who gains access to and use of the account through an unauthorized means, such as a change of address or request for re-issuance of credit or debit cards (or other device for accessing a credit or debit account — for example, convenience checks) but not lost or stolen cards.
06	Card Not Present Fraud - A fraudulent transaction that occurs with the use of credit or debit account information including pseudo-account information without the physical card or other device being involved, via the phone, mail, Internet, or other electronic means without the actual, implied, or apparent authority of the cardholder.
08	Fraud - The acquirer suspects that the transaction presented by the merchant was not authorized by the genuine cardholder.
10	Testing - Acquirer - The acquirer suspects that the transaction is the result of authorization testing by an unauthorized entity without the consent of the genuine cardholder.
51	Bust-out Collusive Merchant — A collusive cardholder engaging in transactions with a collusive merchant as defined in the Cardholder-Merchant Collusion Program.
53	Testing - Issuer - The issuer suspects that the transaction is the result of authorization testing by an unauthorized entity without the consent of the genuine cardholder.
54	Undetermined - The issuer suspects the transaction is fraudulent but is unable to determine the fraud reason at the time of Suspected Fraud submission.
55	Modification of Payment Order (EEA only) - An unauthorized payment transaction made as the result of the loss, theft, or misappropriation of sensitive payment data or payment instrument, whether detectable or not to the payer prior to a payment and whether or not caused by gross negligence of the payer or executed by the payer.
56	Manipulation of Cardholder (EEA only) - Any payment transaction that was made as a result of the payer being manipulated by the fraudster to provide payment, or give instruction to do so to the payment service payment provider, in good faith, to a payment account it believes belongs to a legitimate payee.