What Is Cancel Re-occurring In | Chargebacks.

Visa Chargeback Reason code 41 results from the cancellation of recurring transactions. You should know that many major companies have their own chargeback reason codes, these help merchants understand why chargeback was implemented. Code 41 can be initiated because of multiple reasons, here are some that merchants should know.

Chargeback -41Reason Code 



• When the transaction amount is higher than the authorized dollar amount.
• The merchant had to notify the cardholder before processing, but the notification wasn’t sent to the cardholder.
• If cardholder files a complaint to the card brand saying that it was notified to the merchant to cancel the transaction, or account was closed but the merchant still billed cardholder.
• The merchant exceeded the pre-authorized dollar amount range and did not notify the cardholder in writing within ten days prior to processing the transaction.

How To Prevent These Reason Code?

Of course, your goal should be dealing with the causes for Reason Code 41, rather than sorting out its consequences. Here is what you should be doing to prevent this type of chargebacks from occurring:

1.           Honor customer cancellation requests.

                   All cancellation requests should be processed quickly. Send a notification to your customer that her                               recurring payment plan has been closed. If any amount is still due up to the date of cancellation, request                     payment for it, but do not process a recurring one.

      2.   Enroll in the Visa and MasterCard account updater services.

ü  These services keep the card account information you have on file for your customers current, which helps prevent declines and chargebacks.

ü   For example, if a new card was issued to your customer, it would have a new expiration date. If the information is not updated and you try to process the transaction, it will be declined.

ü   As customers rarely bother to update their card information on file for recurring payments, your best option for keeping it current is the automatic updating system.

ü  Not all processors support the updates, so be sure to ask them for it before signing the processing agreement.

      3.   Process credits promptly.

 When you receive a cancellation request too late to prevent the most recent recurring payment from posting, quickly process a credit to your customer’s account and notify her that you’ve done so.

These are the few thumb rules which a merchant should do after he has been charged back with this reason code.  It's more beneficial if the merchant asks for assistance from the service provider to maintain this dicey situation.

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