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Resolve Chargeback Tool — Reason Codes

Visa / MasterCard Reason Code 41


Definition:
Cancelled Recurring Transaction. Merchant continued to charge cardholder's account for recurring transaction after receiving a notice of cancellation.

Note for merchants with variable recurring transaction amounts: When you set up the customer's recurring billing, you should have disclosed that this charge would be for a variable amount and permitted the cardholder to set a range of approved charges. If a charge exceeded this amount and you did not notify the cardholder in advance, they are able to successfully dispute the charge using the above reason code. If the customer disputed the charge using that reason code, we recommend you contact the cardholder directly to obtain payment and determine if this recurring service should be cancelled.

Q: Is this a recurring charge?

    

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Q: Is this a recurring charge?   A: Yes

Q: Did you receive a notice of cancellation from the customer or customer's bank?

    

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Q: Is this a recurring charge?   A: No

 
RESULT
If the transaction in dispute is not a recurring transaction, review the documentation you have available to provide about the purchase. For example if this was an installment purchase and the customer agreed to a contract for making installment payments over a certain time period for goods and services, the Chargeback can be represented with a copy of the customer's contract. Be sure to include a memo summarizing the terms that the customer agreed to.

Tips
  • Be sure to provide the documentation by the due date to preserve your rights to dispute the Chargeback.
  • If the cardholder tells, you they are going to withdraw the Chargeback we recommend you still go ahead and represent the Chargeback to ensure you preserve your rights.

Q: Did you receive a notice of cancellation from the customer or customer's bank?   A: Yes

Q: Is this charge for final services delivered PRIOR to the customer contacting you with notice of cancellation?

    

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Q: Is this charge for final services delivered PRIOR to the customer contacting you with notice of cancellation?   A: Yes

 
RESULT
You may have a Chargeback representment right. (US Visa cards only) Documentation needed to represent this Chargeback would be
  1. Proof that the charge represented services provided before the date of cancellation. Make sure you're very clear about what services the charge represents. If you can demonstrate the customer was using the service during this period, we recommend you include that information.
  2. Proof of the cardholder's date of cancellation. If they cancelled by email or mail, include a copy of the email or letter. If they cancelled by phone, include a print out of the customer contact log of their cancellation.

Tips
  • Be sure to provide the documentation by the due date to preserve your rights to dispute the Chargeback.
  • If the cardholder states they are going to withdraw the Chargeback we recommend you still go ahead and represent the Chargeback to ensure you preserve your rights.

Q: Is this charge for final services delivered PRIOR to the customer contacting you with notice of cancellation?   A: No

 
RESULT
To accept a Chargeback no action is necessary on your part, you do not need to respond to this Chargeback.

Tips
  • To prevent Chargebacks, advise the customer that you are issuing them a credit, and credit their account as soon as you realize they were owed money.
  • Never issue a credit after a Chargeback has occurred. In doing so you risk paying the customer twice.

Q: Did you receive a notice of cancellation from the customer or customer's bank?   A: No

Q: Did you issue a credit?

    

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Q: Did you issue a credit?   A: Yes

 
RESULT
This chargeback can be represented. The documentation needed is:

A print out of the credit (if issued to the credit card)

Or

A copy of the front and back of the cancelled check or money order (if issued by check or money order)

If the credit issued was a partial credit, be sure to include an explanation as to why full credit was not issued.

Tips
  • Be sure to provide the documentation by the due date to preserve your rights to dispute the chargeback.
  • If the cardholder states they are going to withdraw the chargeback we recommend you still go ahead and represent the chargeback to ensure you preserve your rights.
  • To reduce risk of receiving a chargeback we recommend credits be issued to the account used in the purchase and not by check or money order.

Q: Did you issue a credit?   A: No

Q: Is this charge for final services delivered PRIOR to the customer contacting you with notice of cancellation?

    

Start This Reason Code Over

Q: Is this charge for final services delivered PRIOR to the customer contacting you with notice of cancellation?   A: Yes

 
RESULT
You may have a Chargeback representment right. (US Visa cards only) Documentation needed to represent this Chargeback would be
  1. Proof that the charge represented services provided before the date of cancellation. Make sure you're very clear about what services the charge represents. If you can demonstrate the customer was using the service during this period, we recommend you include that information.
  2. Proof of the cardholder's date of cancellation. If they cancelled by email or mail, include a copy of the email or letter. If they cancelled by phone, include a print out of the customer contact log of their cancellation.

Tips
  • Be sure to provide the documentation by the due date to preserve your rights to dispute the Chargeback.
  • If the cardholder states they are going to withdraw the Chargeback we recommend you still go ahead and represent the Chargeback to ensure you preserve your rights.

Q: Is this charge for final services delivered PRIOR to the customer contacting you with notice of cancellation?   A: No

 
RESULT
To accept a Chargeback no action is necessary on your part, you do not need to respond to this Chargeback.

Tips
  • To prevent Chargebacks, advise the customer that you are issuing them a credit, and credit their account as soon as you realize they were owed money.
  • Never issue a credit after a Chargeback has occurred. In doing so you risk paying the customer twice.

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