Discover Chargeback Reason Code IC: Services

Table of Contents

1. What is Discover chargeback reason code IC?
2. What causes code IC chargebacks?
3. What's the time limit to respond to code IC chargebacks?
4. How can merchants fight code IC chargebacks?
5. How can merchants prevent code IC chargebacks?
6. About Discover chargeback reason codes

Merchants who receive a chargeback for a transaction placed with a Discover card may encounter reason code IC, 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 almost always merchant error. Merchants who believe they have received an invalid chargeback under reason code IC may be able to represent the transaction and reverse the chargeback with the right compelling evidence.

What is Discover chargeback reason code IC?

Discover chargeback reason code IC falls under the “Services” category. The shorthand description is “Illegible Sales Data.” This reason code is used when Discover sends a retrieval request to a merchant and the merchant sends back a copy of a sales receipt that is illegible.

Transaction documents, especially sales receipts, are among the most important forms of evidence a merchant can submit to prove that a transaction was carried out properly and with authorization approval. Receipts can show approval codes, transaction amounts, customer signatures, and other important details that can make or break a case for the merchant.

Most retrieval requests will ask for a copy of a sales receipt, but if the receipt is not legible, it can't be used as evidence against the cardholder’s claim.

When a merchant sends back an illegible sales receipt, Discover will often grant the cardholder their chargeback and assign it this reason code.

What causes code IC chargebacks?

Code IC chargebacks are caused by some error on the merchant's end that makes them unable to provide a legible transaction receipt upon request.

Usually, the situation is that the merchant only has one hard copy of the receipt, and it cannot be read for one of the following reasons:

• The ink or toner cartridge was low when the receipt was printed.
• The receipt paper was ribbed or colored, obscuring the printed text.
• The printing on the receipt has faded due to age or exposure.
• The original receipt was mishandled and damaged in some way, rendering it unreadable.
• The original receipt was scanned to a digital file, but at a size or resolution that makes it impossible to read.

What's the time limit to respond to code IC chargebacks?

The acquirer or merchant has 30 days to respond to a chargeback filed under reason code IC.

How can merchants fight code IC chargebacks?

Merchants may be able to fight code IC chargebacks if they can produce legible copies of the requested documentation.

Your chargeback response should include the following:

• Clear and readable copies of all relevant transaction documents, including an imprint (where applicable) showing all of the security features required to be embossed on the card.
• The original receipt, if an illegible copy or digital file was originally provided.

How can merchants prevent code IC chargebacks?

Code IC chargebacks can easily be prevented by making sure that your receipts are printed legibly and that you keep high-quality copies of them in your records in case they are ever requested by Discover.

Ideally, merchants should have systems in place to automatically save digital copies of every transaction receipt and should make backups of those records frequently.

These tips can also help merchants avoid code IC chargebacks:

• Change the ink or toner cartridge in your receipt printer whenever it gets low.
• Use the receipt paper recommended by the manufacturer of your receipt printer.
• Visually inspect your receipts when they are printed to make sure they can be read clearly.
• If your receipt printer consistently fails to print legible receipts, consider replacing it entirely.
• Store receipts and other important transactions documents in a safe place. Do not leave them out where they may become worn or damaged.
• When scanning electronic copies of receipts and other transaction documents, make sure the digital files are appropriately sized and legible before discarding the originals.

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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