American Express Chargeback Reason Code P08: Processing Errors

chargeback reason code p08Merchants who receive a chargeback for a transaction placed with an American Express card may encounter reason code P08, which indicates a transaction that was not processed correctly by the merchant. The actual underlying cause of this chargeback tends to be either friendly fraud or merchant error. Merchants who believe they have received an invalid chargeback under reason code P08 may be able to represent the transaction and reverse the chargeback with the right compelling evidence.

What is American Express Chargeback Reason Code P08?

American Express chargeback reason code P08 falls under the “Processing Errors” category. The shorthand description is “Duplicate Charge.” This reason code may be used when a merchant submits a single transaction more than once, resulting in duplicate charges on the cardholder's account.

Human error and computer glitches can result in the same transaction being submitted multiple times, but this chargeback can also result from cardholders misunderstanding the nature of recurring or installment billing charges.

Friendly fraud chargebacks may result when cardholders experience buyer's remorse after multiple purchases with the same merchant. They may try to claim that some of those charges are duplicates in an attempt to convince American Express to allow a chargeback. Unintentional friendly fraud is possible as well, especially when merchants submit multiple similar charges because the customer is on an installment billing plan or a similar arrangement that leads to multiple identical-looking charges.

What Scenarios Might Lead to This Chargeback?

When this chargeback is filed for a legitimate basis, it is usually due to merchant error. The merchant may have entered the same transaction data twice by mistake, and submitted it both times, or some sort of system error has occurred causing a duplicate transaction. For example, a network error might cause a merchant to believe that a batch of transactions has not been submitted, so they send it again—but it did actually go through to the processor the first time.

This reason code frequently shows up with friendly fraud when cardholders see two similar transactions—for instance, two scheduled installment payments—and leap to the conclusion that one is a duplicate.

Get the guide, Chargebacks 101: Understanding Chargebacks & Their Root Causes

What are the Important Timeframes?

The acquirer and/or merchant have 20 days to respond to this chargeback after it is filed. No special timeframes apply to the cardholder.

How Can Merchants Fight this Chargeback Code?

Merchants can fight this chargeback if the cardholder’s claims are false and both transactions are in fact legitimate. Your chargeback response must include at least one of the following items:

  • If multiple transactions were needed, provide documentation (such as receipts, purchase orders, or signed customer agreements) that shows that each purchase was separate and valid.
  • If you have already processed a refund for the transaction in question, provide documentation that proves you have credited the cardholder’s account.

How Can Merchants Prevent this Chargeback Code?

If you find yourself falling victim to this kind of chargeback, the first thing to do is review your operational procedures with respect to payment processing and make sure that you aren’t duplicating transactions due to inefficiencies, inadequate training, or other fixable errors.

It can be more difficult to put an end to these chargebacks if they’re resulting from friendly fraud, so don’t hesitate to block customers who engage in that sort of behavior.

These tips can help you avoid many of the situations that lead to duplicate processing disputes:

  • If you notice that you have processed a duplicate transaction, issue a credit to the customer immediately.
  • Double check all transaction receipts before they are deposited.
  • Only send batches one time. If you believe you need to resubmit a batch due to some error, check with your payment processor.
  • Send customers advance notice of recurring or installment payments that might look similar to their previous transactions.
  • If the customer wants to change to a different form of payment after initially offering their payment card, be sure to void the charge in progress.

About American Express Chargeback Reason Codes

Reason codes are alphanumeric codes that provide the justification for granting a chargeback. Pursuant to the Fair Credit Billing Act of 1974, cardholders have the right to dispute unauthorized or erroneous charges and issuing banks must reverse a disputed transaction of the cardholder’s claim is valid.

When a cardholder contacts their issuing bank to dispute a transaction and receive a chargeback, the dispute is assigned a reason code that most closely matches the substance of the cardholder’s claims. The reason code provides the merchant and other stakeholders in the dispute with a concise explanation for why a chargeback has been granted.

Each card network—Visa, Mastercard, American Express, and Discover—defines and maintains their own unique set of reason codes, which are applied to disputes by the banks that issue credit and debit cards under their brands.

As both a card network and an issuer, American Express specifies 34 reason codes under the categories of Fraud, Authorization, Processing Errors, Card Member Disputes, and Inquiry/Miscellaneous. Each American Express reason code consists of one or more letters, indicating the category, and a number that identifies the specific dispute reason.

Understanding chargeback reason codes is one of the most essential parts of effective chargeback management. Identifying the chargeback reason code and the evidence required to fight it is the first step in chargeback representment, and analyzing your chargeback reason codes can provide you with insights into what types of disputes are causing you the most trouble. With this information, you can determine the root causes of your chargebacks and take action to prevent them from reoccurring.