Reason Code RN2 — Credit Not Processed

Okay. So, you just got a new Discover card chargeback, filed using reason code RN2.

Understanding the specific reasons behind each chargeback is essential. And, in the case of reason code RN2, we’re talking about a situation where a customer is claiming to be entitled to a credit that was never processed.

But... what’s that mean? What are you supposed to do with this information, and crucially, what moves can you make to ensure you don’t lose out on any of your funds?

This article outlines the key details related to reason code RN2, providing clear guidance on identifying the cause and resolving the issue efficiently.

What is Discover Reason Code RN2?

Discover chargeback reason code RN2 is “Credit Not Processed.” It’s used when a cardholder has returned merchandise or canceled services, but you never issued an appropriate credit to the customer’s account.

For instance, imagine a buyer made a purchase, but was unsatisfied with the goods when they arrived. Maybe they got damaged in transit, let’s say. So, the buyer submits a return request, and ships the goods back... but the money for the purchase never gets returned to their card.

The idea here is to ensure that you provide timely refunds when customers return merchandise or cancel services. This helps protect cardholders from unauthorized charges and promotes fair business practices.

What Caused This Dispute?

Reason code RN2 can be issued in a number of different cases. For example:

The above are examples of potential cases where a reason code RN2 dispute might be issued. But, keep in mind that that it’s not an exhaustive list.

Ticket Retrieval Request & Other Issuer Requirements

The cardholder is expected to provide some evidence to support their claim at the time they requested the chargeback. If the don’t provide any evidence to support the dispute, then the issuer need to initiate a ticket retrieval request to get more information.

• The issuer needs to provide Discover with all of the following information:
• Description of the goods returned or services refused
• Date of return or refusal
• Return method
• Copy of transaction documentation
• Cancellation number (if applicable)
• Credit confirmation number (for card-not-present transactions only)
• Any correspondence showing you promised a refund or credit

The cardholder must also at least attempt to return any merchandise received before the chargeback can be initiated.

The issuer also has to wait at least 10 calendar days from either the date of cancellation by the cardholder, or the date goods were returned, as applicable, before initiating the dispute.

How to Respond to Discover Reason Code RN2 Chargebacks

Imagine you're doing everything right. You're using identifiable billing descriptors and sticking to Discover network's regulations for retailers... but you still get hit with a reason code RN2 dispute.

When you're certain the chargeback isn't valid, there's a process in place to contest it called chargeback representment.

This is a strictly managed, time-bound process. It lets vendors gather definitive proof that the transaction in question is authentic and the client’s reasoning for the chargeback is unjust.

You’ll need evidence to engage in representment, though, which directly relates to and addresses the reason code issued.

To fortify your case, consider writing a succinct rebuttal letter summarizing the transaction subject to dispute. Your letter should detail the counter-evidence provided, and dispute the client’s allegations. Afterward, assemble all the evidence and the letter into a unified representment package.

Be sure to submit all documentation within 20 days of the chargeback notification. Discover will assess the representment package and will either endorse or overturn the transaction.

Acceptable Evidence for Discover Reason Code RN2 Responses

As previously noted, providing pertinent and persuasive evidence is key to improving your odds of success against a reason code RN2 chargeback. Some examples of acceptable documentation include:

• Signed contract or agreement
• Proof of delivery/signature confirmation
• Recorded/voice authorization from the Cardholder
• Online sales acknowledgment (showing acceptance of terms & conditions)
• Legible copy of a government issued ID showing cardholder name and signature
• Order form/invoice/agreement detailing the sale
• Delivery service proof of shipment/delivery
• Any documents outlining what was provided to cardholder during dispute period (i.e. email chain, customer support chats)
• Purchase receipt with date/time stamp and merchant information

You can also provide documentation showing the cardholder received a credit to their account that offsets the original charge. Acceptable evidence here includes:

• Return or cancellation confirmation from your merchant system
• Credit slip/receipt showing a refund has been issued
• Tracking number/proof of return shipment
• Bank statement displaying credit to the cardholder's account
• Correspondence with cardholder outlining return process and time frame for credit

It is important to note that these are just a few examples. Additional documentation may be needed, depending on the claim being made. The key is to provide clear and relevant evidence that supports your case against the reason code RN2 chargeback.

How to Prevent Discover Reason Code RN2 Chargebacks

Chargebacks can be a frustrating and expensive experience. But, the best way to keep those costs in check is to prevent chargebacks before they happen. We’ve outlined a couple of tips below that might help you prevent these disputes from happening:

You’re juggling a lot responsibilities, from ensuring customer satisfaction to enhancing products and services and warding off expensive chargebacks. We get it.

But, the fact is that, without adequate expertise or systems, chargebacks can result in damage to your reputation and disruptions to your operations. You’ve gotta get proactive about chargeback prevention.

Overwhelmed about how to tackle chargebacks? Connect with Chargebacks911®, the leading experts in avoiding chargebacks and representment, for a complimentary ROI analysis today.