Reason Code C28 — Canceled Recurring Billing

How to Handle Amex Reason Code C28 Chargebacks

American Express breaks down the acceptable causes for a customer to dispute a credit card transaction in their dispute guidelines. This is done for the sake of simplicity and standardization. 

Each chargeback trigger has a designated “reason code.” Amex can then assign the appropriate code to each case to show the given reason for the chargeback.

Learn more about Amex reason codes

Today, we’re looking at one reason code in particular — C28 — and exploring the causes, timeframes, fees, and other specifics. We’ll also explore what you can do to prevent these chargebacks from happening.

What is American Express Reason Code C28?

American Express chargeback reason code C28 is “canceled recurring billing.” This reason code is used to explain that a customer attempted, but was unable to cancel a service.

When customers enrolls in any kind of service paid for using recurring billing, there’s an expectation that the customer will abide by the terms agreed to at signup. However, legislation like the Restore Online Shoppers’ Confidence Act, as well as the “Click To Cancel” rule adopted by the FTC back in 2023, also mandate that customers have an easy, straightforward way to cancel services.

If a customer believes they’ve conducted their due diligence in trying to cancel a recurring service, but the merchant has ignored their requests, they may be entitled to a reason code C28 chargeback.

What Caused This Dispute?

Amex chargeback reason code C28 is primarily issued if you failed to respond to a customer’s cancellation request in a timely manner. To demonstrate, this scenario can arise if:

• Order Not Yet Processed
  A request for cancellation of weekly/monthly/annual recurring services was made but has not been processed in a timely manner.
• Credit Not Received
  Customer expected a credit or refund for a canceled recurring service, but the credit or refund was never issued.
• Customer Billed Before Credit Arrived
  You issued credit, but the customer was rebilled before the credit was posted to their statement.
• Policy Misunderstanding
  The buyer could not understand your merchant service terms, cancellation policy, refund policy, billing process, or automatic renewal terms.
• Cancelation After Renewal
  The cardholder canceled services after the renewal date, and so was billed for the renewed service.
• Customer Attempted to Cancel Service
  The customer attempted to contact you about cancellation of service, but was unable to reach you.
• Delayed Cancellation of Service
  The customer asked to cancel service, but the request was not fulfilled in a timely manner, resulting in the customer being charged for the renewed service.
• Introductory Offers
  The cardholder was billed for an introductory offer which they did not ultimately want.

How to Respond to Amex Reason Code C28 Chargebacks

So, what happens if you can prove that you did cancel a recurring service as the customer requested?

You have the right to challenge this chargeback through a process called representment. In essence, representment is your opportunity to present your case, showing that the transaction was legitimate and consistent with all the policies set by American Express. It’s your chance to provide hard evidence and tell your side of the story.

Time is of the essence when it comes to fighting chargebacks, though. You have just 20 days from American Express in which to submit your response. This window includes the notification period from your acquirer, plus any time spent reviewing your case. In practice, this often leaves you with five days or less to prepare all your evidence and submit your response. So, you have to act swiftly, efficiently, and decisively.

Acceptable Evidence for Amex Reason Code C28 Responses

You can re-represent these charges under the condition that you have compelling evidence.

For American Express reason code C28 chargebacks, you’ll need to provide a breakdown of your policies and procedures, showing how the cardholder failed to abide by them. Alternately, you can try to prove the cardholder plans to continue using your service (just not to pay for it), or proof that you’ve already provided a credit to the buyer to offset the charge disputed.

Examples of documentation you can submit include:

• A copy of your cancellation policy
• Copies of any emails or phone transcripts outlining conversations with the buyer
• Confirmation from the buyer that they’ve read and agreed to your terms of service
• Records of previous, undisputed charges from the same buyer
• Social evidence of the buyer using the good or service (photos, social media posts, etc.)
  

Alternatively, you might have already issued a credit to the buyer as a way of trying to avoid the dispute. In this case, you’ll need to offer proof that you already provided a credit to offset the amount charged.

The success of representment depends on the thoroughness and relevance of the evidence provided. Maintaining detailed records of transactions and communications with customers is vital to effectively counteract all chargebacks, including those under reason code C28.

Additional Evidence: Charges in Connection With an Introductory Offer

There are additional pieces of evidence you should provide if you receive a chargeback with American Express reason code C28 because your customer was billed for an introductory offer which they did not ultimately want. These include:

• Proof of a “simple and expeditious cancellation process,” which allows the cardholder to easily cancel before their initial charge.
• Proof that you obtained the cardholder’s express consent to the terms and conditions of the offer.
• Copy of a written confirmation that you sent the cardholder upon enrollment in the service.
• Copy of a written reminder notification sent to the cardholder, which allowed a reasonable amount of time for the cardholder to cancel service.

How to Prevent Amex Reason Code C28 Chargebacks

As the old adage goes, “an ounce of prevention is worth a pound of cure.”

You may never be able to stop chargebacks entirely. But, you can limit your exposure to risk and keep your chargeback ratio in good standing by adopting a few best practices. Generally speaking, you’ll want to:

Take a Wider View

You can dispute invalid chargebacks from Amex reason code C28. However, it’s much more efficient to take a proactive stance. The same is true of the other chargeback reason codes, as well. A truly effective chargeback management strategy must encompass prevention as well as disputing cases of friendly fraud.

Chargebacks911® can help your business manage all aspects of chargeback reason codes, with proprietary technologies and experience-based expertise. Contact us today for a free ROI analysis to learn how much more you could save.