Discover Chargeback Reason Code AW: Services
Table of Contents
- What is Discover chargeback reason code AW?
- What causes code AW chargebacks?
- What's the time limit to respond to code AW chargebacks?
- How can merchants fight code AW chargebacks?
- How can merchants prevent code AW chargebacks?
- About Discover chargeback reason codes
Merchants who receive a chargeback for a transaction placed with a Discover card may encounter reason code AW, which indicates an improperly authorized transaction that the cardholder does not believe they should be responsible for paying. The actual underlying cause of this chargeback is usually either friendly fraud or merchant error. Merchants who believe they have received an invalid chargeback under reason code AW may be able to represent the transaction and reverse the chargeback with the right compelling evidence.
What is Discover chargeback reason code AW?
Discover chargeback reason code AW falls under the “Services” category. The shorthand description is “Altered Amount.” The reason code means that the transaction amount submitted for authorization does not match the amount that was actually posted.
Cash advance transactions are a frequent culprit behind these chargebacks. It's also possible for merchants to change the transaction amount during processing, and finalize a transaction for a different amount than was authorized.
What causes code AW chargebacks?
Code AW chargebacks are often caused by a merchant significantly changing the transaction amount without requesting a new authorization or getting consent from the customer or by failing to give the correct amount of cash to a customer who requested a cash advance.
Merchant error can lead to this chargeback when proper authorization procedures aren’t followed and the merchant changes the transaction amount after authorization approval has already been granted.
When this chargeback relates to a cash advance transaction, it may be because the merchant dispensed the wrong amount of cash, or mistakenly entered a cash advance amount that the customer did not ask for or receive.
Because it can be difficult to prove whether or not proper cash advance amounts were dispensed, some cardholders will file friendly fraud chargebacks and falsely claim that a cash advance amount included in a transaction was not given to them, even though it actually was.
What's the time limit to respond to code AW chargebacks?
The acquirer or merchant has 30 days to respond to a chargeback filed under reason code AW.
How can merchants fight code AW chargebacks?
In a cash advance dispute, merchants must prove that the correct amount of cash was disbursed. In cases where the transaction amount was changed after the fact, merchants must show that the change in amount was legitimate and was agreed to by the customer.
How can merchants prevent code AW chargebacks?
The keys to preventing this kind of chargeback are to carefully follow the correct procedures for authorizing and submitting transactions and to handle cash advance transactions with due diligence and safeguards that will reduce the chance of accidentally shorting your customers.
If it’s feasible for your business, it may be helpful to have customers sign a slip confirming that they received the correct cash advance amounts.
The following best practices can also help you avoid these chargebacks:
- Before finalizing a transaction, double-check your price calculations and the final transaction amount.
- Never change a transaction amount without the cardholder’s permission.
- If you need to change the amount of a transaction already in progress, be sure to go back and reauthorize it for the correct amount.
- Train your staff on the proper payment processing procedures for transactions that include tips or gratuities.
- Train your staff to pay close attention to cash advance transactions and to count paid out cash carefully.
- Reconcile the cash advance amounts in your transaction history with the actual cash amounts distributed.
- Keep your ATMs updated and serviced regularly.
About Discover 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 if 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, Discover specifies 26 reason codes under the categories of Fraud, Not Classified, Authorization, Expired, Processing Errors, Services, and Dispute Compliance. Most of Discover’s reason codes are a two-letter abbreviation of the dispute description.
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.
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