Discover Reason Code Encyclopedia
Your comprehensive guide to reason codes, modifiers, time limits, and compelling evidence for Discover Card disputes and transactions.
Discover Reason Codes
Discover uses the four main categories to organize its reason codes: Authorization, Service (Discover’s name for Card Member Disputes), Fraud, and Processing Errors. Discover has just one additional category to classify one reason code: Dispute Compliance. These codes can help a merchant with an inquiry or chargeback reversal. Below we provide the reason codes along with a link to each code on how to potentially win a Discover dispute.
| Code | Description | Transaction Modifiers | Category | How to Win |
|---|---|---|---|---|
| UA01 | Fraud – Card Present Transaction | Site to Store | Fraud | |
| UA02 | Fraud – Card Not Present Transaction | Card Not Present, Site to Store | Fraud | |
| UA05 | Fraud – Chip Counterfeit Transaction | None | Fraud | |
| UA06 | Fraud – Chip and PIN Transaction | None | Fraud | |
| AT | Authorization Noncompliance | None | Authorization | |
| IN | Invalid Card Number | None | Processing Errors | |
| LP | Late Presentation | None | Processing Errors | |
| 05 | Good Faith Investigation | None | Services | |
| AA | Does Not Recognize | None | Services | |
| AP | Recurring Payments | None | Services | |
| AW | Altered Amount | None | Services | |
| CD | Credit/Debit Posted Incorrectly | None | Services | |
| DP | Duplicate Processing | None | Services | |
| NF | Non-Receipt of Cash from ATM | None | Services | |
| PM | Paid by Other Means | None | Services | |
| RG | Non-Receipt of Goods, Services, or Cash | Airline Transaction, Card Not Present, Site to Store | Services | |
| RM | Cardholder Disputes Quality of Goods or Services | Card Not Present, Site to Store | Services | |
| RN2 | Credit Not Processed | None | Services | |
| DC | Dispute Compliance | None | Dispute Compliance |
The chargeback process
What is the Discover dispute process for merchants?
Disputes from Discover card fraud will vary from merchant to merchant, but the process typically follows the following path. First, the cardholder contacts Discover customer service to dispute a transaction. Discover then contacts the merchant to review information pertaining to the dispute as well as gather additional information. If the merchant does not provide the right information in response to a ticket retrieval request, Discover may issue a chargeback.
But remember, the entire process can be avoided if the customer first calls the merchant to try to solve the transaction before they call Discover to issue a dispute.
Discover Time Limits to Respond To Ticket Retrieval Requests and/or Chargebacks
Time limits are for the acquiring bank. Merchants will typically be given half the amount of time the acquiring bank is given to accommodate for the time they need to process internally.
Ticket retrieval requests occur when a customer makes an inquiry about a card transaction and Discover does not issue a chargeback. As the merchant, once you receive the ticket retrieval, you have 30 days to provide a copy of the original receipt or refund the transaction.
If the merchant cannot deliver the original receipt or a substitute receipt, or the merchant fails to respond in the given time frame with a refund, Discover will turn a dispute into a chargeback.
If the merchant gives the proper documentation within the 45 day time frame, you have the potential to reverse the chargeback. Otherwise, after 45 days, the chargeback will stand.
Keep in mind, like American Express, cardmembers have no time limit when it comes to disputing a transaction.
Discover Transaction Modifiers
A transaction modifier (or modifier) represents specific circumstances associated with a card sale that change what compelling evidence is required to overturn the chargeback.
Airline Transaction
Applies to Reason Codes
How to Respond
- Respond by providing the following evidence that either shows:
- The cardholder used the disputed airline ticket
- The lost ticket application submitted by the cardholder is not valid
Card Not Present
Applies to Reason Codes
How to Respond
- For Discover reason codes RG and RM, provide any of the following:
- Cardholder confirmation of registration to receive electronic delivery of goods or services
- Cardholder’s e-mail or IP address, date and time of download, description of goods downloaded or log documenting the receipt of downloaded material on or after the transaction date
- For Discover reason code UA02, prove that the items were delivered and that you used the Address Verification Service (AVS) to validate the numeric portion of the cardholder’s billing address, including street address and ZIP code, or that the response to an AVS request indicated that the cardholder’s address is not verified because the card is issued outside of the United States. Or provide any of the following:
- Cardholder confirmation of registration to receive electronic delivery of goods or services
- Cardholder’s e-mail or IP address, date and time of download, description of goods downloaded or log documenting the receipt of downloaded material on or after the transaction date
Site to Store
Applies to Reason Codes
How to Respond
- For all reason codes, provide either:
- The cardholder’s signature on the pick-up form
- A copy of the cardholder’s identification presented at the time of pick-up
How to Prevent a Discover Dispute
How can you avoid a Discover dispute in the first place? Read on for a few tips.
Get a valid form of payment
If the customer’s Discover card is not working properly, ask for another form of payment — Discover no longer allows merchants to use a card imprint as a defense against a chargeback.
Refund in a timely manner
Issue credit for items that were not received, returned or cancelled, in a timely manner. Let customers know when they will receive their credit. If you are not issuing credit after a return, provide a thorough explanation and a number to call for further questions.
Bill after shipping & services
Never bill the customer for items that are backordered or voided. Only bill customers after the product is shipped or the service is provided.
Verify delivery address
Verify the delivery address and always provide the delivery address and tracking number on the order forms of an item. This helps for proof of delivery and can be important information when solving a potential dispute.
Communicate your policies
Make sure your business information, policies, and customer service phone number are easily accessible for your customers. Good places to include this information is on the back of receipts, order forms, and on your website.
Check merchant descriptors
Always use the more recognizable name of your organization, as opposed to your organization’s legal name, in your merchant descriptors. The most effective descriptors are those that clearly remind customers of who received their funds.
Obtain a signature
Make sure to get the customer’s signature on items that are picked up in store, work orders, etc. for when a service is completed.
Accommodate your customers
Always keep dissatisfied customers informed on the steps you are taking to remedied the situation (providing a exchange, return, etc.). Always make sure you handle these situations to the card member’s satisfaction.
Additional Discover Security Management Tools For Merchants
Discover offers merchants who accept the Discover card management tools to better fight fraud, both in person and online. From receiving real-time incident information to merchant validation tools and activity monitoring software, Discover is helping merchants stay one step ahead of fraud.
The Ultimate Dispute Management Resource
Looking for additional help when it comes to Discover disputes? Download our 100+ page comprehensive guide to reason codes, modifiers, time limits, and compelling evidence.
Why Chargeback?
Real-time dispute management platform
Chargeback offers you a variety of resources to help better manage payment fraud and disputes. In addition to our articles and reason code library, we also provide eBooks, guides, case studies and events.
From lowering dispute ratios to saving you time and eliminating frustration, see how the Chargeback App’s automated dispute management platform can help your business today. We work hard to offer the best solution in order to help merchants lower their dispute ratio, improve their win rate and save time that they could have lost from chargeback responses.
