Table of Contents
- What is Discover chargeback reason code EX?
- What causes code EX chargebacks?
- What's the time limit to respond to code EX chargebacks?
- How can merchants fight code EX chargebacks?
- How can merchants prevent code EX chargebacks?
- About Discover chargeback reason codes
Merchants who receive a chargeback for a transaction placed with a Discover card may encounter reason code EX, which indicates a transaction processed against an expired card. The actual underlying cause of this chargeback tends to be merchant error. Merchants who believe they have received an invalid chargeback under reason code EX may be able to represent the transaction and reverse the chargeback with the right compelling evidence.
What is Discover chargeback reason code EX?
Discover chargeback reason code EX falls under the “Expired” category. The shorthand description is “Expired.” This reason code indicates a cardholder is disputing the validity of a charge because the card was past its expiration date at the time the transaction was processed.
Most of the time, when a merchant submits an authorization request for a transaction, an expired card will return a “decline” response. However, there are situations where a charge can be processed against an expired card.
What causes code EX chargebacks?
Code EX chargebacks are usually caused by merchant error. Merchants should never force a transaction through without authorization. While most payment processing systems are set up to prevent this, it may be possible to do so regardless, which can lead to a chargeback
While processing a transaction without authorization can set a merchant up to receive various types of fraud and authorization-related chargebacks, they may find themselves on the receiving end of Discover reason code EX if the card happened to have expired before the transaction date.
Another way this can occur is if the merchant initiates the transaction and obtains authorization before the expiration date, but does not complete the transaction until after it has passed. This is an uncommon scenario, but it can happen.
While it is possible that a fraudster could try to trick or persuade a merchant into forcing a transaction on an expired card, merchants should always have sufficient safeguards to prevent such an obviously improper transaction from being processed.
What's the time limit to respond to code EX chargebacks?
The acquirer or merchant has 30 days to respond to a chargeback filed under reason code EX.
How can merchants fight code EX chargebacks?
Merchants can fight code EX chargebacks with evidence that the card was not expired at the time of the transaction or that authorization approval was received.
Remember that a card is valid through the last day of the month shown in its four-digit expiration date. In other words, if the date is 05/21, the card is valid through the entire month of May and does not expire until June 1st.
Your chargeback response should include the following:
- A transaction receipt that indicates that the card had not yet expired at the time of the sale. Even if authorization was not received, this would suffice to win against a chargeback filed under this reason code.
- Documentation stating the transaction date, amount, authorization approval, and whether the card was swiped or manually imprinted (for card-present transactions) or an internet, mail, or telephone order (for card-not-present transactions).
How can merchants prevent code EX chargebacks?
This is a fairly easy chargeback to prevent, as long as you follow the safe and recommended practices for checking payment card information for validity, requesting authorization approval before completing a transaction, and completing all transactions promptly after initiating them.
When you must use a card on file to place a transaction after the initial sale date, double-check the expiration date to make sure it hasn’t expired in the interim.
The following best practices can help you avoid this kind of chargeback:
- Always check the expiration date on a card before you process it.
- Double-check the cardholder’s stated expiration date on card-not-present transactions.
- Always obtain proper authorization before completing a transaction. Never force an unauthorized transaction to go through.
- Train your point-of-sale staff to check expiration dates carefully and always follow the correct procedures for obtaining authorization.
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.