Mastercard Chargeback Reason Code 4853: Credit Posted as a Purchase
Chargeback reason code 4853: Credit Posted as a Purchase refers to situations where customers claim that a transaction that should be a credit is showing up as a debit, and they do not feel the issue is being resolved by the merchant. In such circumstances, Mastercard may allow consumers to reverse a transaction by filing a chargeback.
Situations that may qualify for a chargeback are broken down into designated “reason codes.” Banks assign the appropriate code to each case so everyone knows the given reason for the chargeback.
We say the given reason because it may or may not reflect the true reason. Even if they suspect the cardholder is making an invalid claim, however, merchants must respond to the reason code presented by the bank.
The process is further complicated by the fact that each card network has its own set of reason codes. While most of the same scenarios are covered, the designations can vary considerably. Understanding which code is which can be challenging, so we’ve created guides to help merchants know how best to fight or prevent the different types of disputes.
With that in mind, let’s take a look at Chargeback Reason Code 4853: Credit Posted as a Purchase.
Should Merchants Worry About Reason Code 4853 Chargebacks?
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What Is a 4853 Chargeback?
Chargeback reason code 4853 is used to designate “Cardholder Disputes,” or disputes involving transactions that a customer claims are incorrect in some way. This umbrella category can be applied to multiple specific situations, many of which had their own specific codes at one time.
Credit Posted as a Purchase chargebacks, for example, at one point fell under legacy reason code 4860. Now, this reason, along with numerous others, are all bundled together under reason code 4853 disputes. So how does a merchant know which particular aspect of a transaction is to blame for the chargeback?
When applicable, an additional message will be provided along with the reason code. Financial institutions refer to this as the Member Message Text, and it tells the merchant which particular type of chargeback is the basis of the claim.
Not all reason codes require this supplemental information, but many do. Knowing the type of chargeback helps merchants pinpoint the specific reason a cardholder dispute reason code was used. This information is crucial for disputing the chargeback and avoiding future claims of the same type.
Credit Posted as a Purchase Disputes: Causes and Conditions
A cardholder filing a claim under a Credit Posted as a Purchase reason code is essentially stating that a refund or some other type of credit is showing up on a monthly statement as a purchase or other debit. It’s possible a merchant is being intentionally fraudulent. However, Credit Posted as a Purchase chargebacks are almost always the result of carelessness or innocent merchant error.
Issuers have a limited timeframe to file chargebacks with a cardholder dispute reason code. These must be processed within 120 calendar days of the original transaction date.
Credit Posted as a Purchase Chargebacks: Prevention and Fraud
Obviously, there’s a problem that needs to be addressed by the merchant if they regularly record credits as purchases. But, as we noted earlier, the given reason for a chargeback may be completely different from the actual reason.
In the case of a Credit Posted as a Purchase dispute, a cardholder may be attempting to scam the merchant. This is a form of chargeback abuse commonly referred to as cyber shoplifting. In the majority of cases, however, the cardholder either:
- Suspects fraudulent actions on the part of the merchant and calls the bank.
- Doesn’t believe the merchant is handling the issue, and so calls the bank to confirm the problem.
- Grows impatient waiting for the correction to show up in an online account and asks the bank to check on the situation.
Any of these actions can cause the bank to initiate a dispute case, whether the cardholder meant to or not. Regardless of intent, however, such a situation would be considered friendly fraud. Merchants have the right to challenge these invalid claims through the representment process, and should do so.
There is good news, however: because they are often the result of merchant error, chargebacks filed under reason code 4853/Credit Posted as a Purchase are highly-preventable. Vigilance and training are the keys to circumventing these errors. Merchants should be certain that staff members fully understand the correct way to process transactions under these circumstances.
Chargeback Prevention: A Wider View
While merchants can take many steps to help prevent legitimate claims, fraudulent chargebacks are another matter: friendly fraud is post-transactional in nature, meaning there’s no sure way to identify it beforehand. Merchants can do everything “right” yet still have a customer dispute filed against them.
So while it’s generally more efficient to take a proactive stance in regards to chargeback management, a truly effective strategy must encompass both prevention and 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.
