MasterCard Chargeback Reason Code 4808: Authorization

Table of Contents

1. What is Mastercard chargeback reason code 4808?
2. What causes code 4808 chargebacks?
3. What's the time limit to respond to code 4808 chargebacks?
4. How can merchants fight code 4808 chargebacks?
5. How can merchants prevent code 4808 chargebacks?
6. About Mastercard chargeback reason codes

Merchants who receive a chargeback for a transaction placed with a Mastercard card may encounter reason code 4808, 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 may be true fraud, friendly fraud, or merchant error. Merchants who believe they have received an invalid chargeback under reason code 4808 may be able to represent the transaction and reverse the chargeback with the right compelling evidence.

What is Mastercard chargeback reason code 4808?

Mastercard chargeback reason code 4808 falls under the “Authorization” category. The shorthand description is “Authorization-Related Chargeback.” The use of this reason code indicates that the merchant did not obtain authorization approval for a transaction, or that the authorization request was sent after the transaction date.

Reason code 4808 replaces several older reason codes that have since been retired. It may come with a description that provides additional context for the dispute scenario:

• Account Number Not On File
  Used when a transaction has somehow been processed against an account number that is nonexistent or inactive. Formerly reason code 4812.
• Cardholder-Activated Terminal (CAT) 3 Device
  Transactions processed at certain cardholder-activated terminals (vending machines, parking garages, toll booths) may be disputed if the transaction exceeds the charge limit or if the card was not valid. This chargeback may also be invoked if the terminal is required to cross-reference account numbers against the Electronic Warning Bulletin File but processes a transaction against a listed number.
• Expired Chargeback Protection Period
  Used when the account is no longer in good standing and the transaction was presented more than seven calendar days after the authorization approval date, or when a preauthorized transaction was presented more than thirty calendar days after the authorization approval date.
• Multiple Authorization Requests
  A card-not-present transaction was declined by the issuer but subsequently approved by a backup process like Stand-In or X-Code. Formerly reason code 4807.
• Required Authorization Not Obtained
  Authorization-related disputes that don’t fit into any of the other scenarios on this list may carry this description. 
• Warning Bulletin File
  Cards with known or reported issues are placed on the Electronic Warning Bulletin File, which gets updated weekly and circulated to banks. Transactions that get processed against cards on this file can be disputed. Formerly reason code 4807.

This chargeback is often seen when merchants forcibly submit a declined transaction, or when they swipe a card multiple times after receiving a “decline” response from the initial attempt to obtain authorization approval. While there may be legitimate issues that prevent an immediate approval, it’s risky to keep running a card until you get the desired response.

What causes code 4808 chargebacks?

In most cases, code 4808 chargebacks occur when a fraudster with a stolen or counterfeit credit card targets a merchant without EMV-compatible payment terminals or convinces a merchant to swipe or key in the card rather than use the chip.

Merchants should always request authorization approval prior to submitting a transaction. If a “decline” or some other ambiguous response is sent, the merchant should ask for an alternate form of payment instead of forcing the transaction through. While most payment systems are designed to stop merchants from running unauthorized transactions, there are ways to bypass these protections.

When this happens, the issuer and cardholder have clear grounds to file a chargeback and the merchant has few valid defenses.

Sometimes, emergency situations may impel a merchant to disregard their proper authorization protocols, or the cardholder may plead with the merchant to make an exception because they have no other form of payment. Merchants may have to rely on their own judgment on how to handle these situations, but they should know that they are leaving themselves vulnerable to fraudulent chargebacks when they make these exceptions.

What's the time limit to respond to code 4808 chargebacks?

The acquirer or merchant has 45 days to respond to a chargeback filed under reason code 4808.

How can merchants fight code 4808 chargebacks?

Merchants can fight this chargeback if the cardholder’s claims are false and the transaction was properly authorized. Your chargeback response should include at least one of the following:

• Proof that the transaction was presented within seven days of authorization or within thirty days of preauthorization.
• Proof that the transaction was submitted against a valid account number in good standing and did not exceed the maximum transaction amount.
• An authorization response or other documentation proving that the cardholder reattempted a transaction that had been initially declined.
• Evidence showing that the chargeback does not comply with Mastercard’s rules and is therefore invalid.
• 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 code 4808 chargebacks?

Requesting authorization approval is one of the most important parts of the transaction process. A documented “approved” response provides compelling evidence against future dispute claims and confirms that the card has not been reported lost or stolen. While there may be circumstances where merchants are tempted to push through a transaction that did not receive an immediate approval, this is always risky and it is always better to cancel the transaction and ask for an alternative payment method.

The following best practices can help you avoid this kind of chargeback:

• Always obtain authorization approval for every transaction you process.
• Always use EMV-enabled payment terminals.
• Keep your terminal software (and operator processes) updated.
• Submit transactions within the allowable time frames. If you have to wait more than seven days to submit a transaction, use a preauthorization hold.
• Don’t reattempt a transaction that gets a hard decline. Use caution when reattempting soft declines.
• Make sure automated terminals always submit authorization requests and do not exceed their transaction limits.
• If the gratuity added to a bill exceeds the authorized amount, obtain an additional authorization before processing the transaction.
• Train your staff on proper transaction processing procedures, especially with respect to handling authorization requests and responses.

About Mastercard 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.

Mastercard specifies 21 reason codes under the categories of Fraud, Authorization, Point-of-Interaction Error, and Cardholder Disputes. Mastercard uses a four-digit numbering scheme for its chargeback reason codes.

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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