Visa Chargeback Reason Code 72

Visa Chargeback reason code 72 is applied when merchant didn’t take approval before the transaction or obtained it after the transaction date.  You take approval before processing, right? If you have been accepting credit cards, you must have learned what will happen if you don’t. This reason code is assigned when transaction received was above merchant’s floor limit, for which authorization wasn’t obtained, or it was obtained using incorrect or invalid transaction data.

Reasons for Visa Chargeback Code 7
There was a tip included in authorization amount, or in simple the amount of transaction was authorized, but the tip was included without permission.
Authorization for the bar, taxicab, beauty shop, limousine, restaurants, and barbershop transactions are valid automatically, including 20 percent, to protect merchants from chargeback when the dispute is initiated by the cardholder. It is also valid up to 15 percent for entertainment and travel merchants.

Preventing Chargeback code 72

• Obtaining approval before transaction should be your first priority. When merchants initiate a transaction, an authorization request is sent to the processor and dollar amount is entered into it. If the transaction is completed, a receipt is generated approval. If it isn't approved then you get a decline message.

• Including tip in the authorized request is not a good idea. Make sure the authorization amount is same as check amount. If there is a bill of $45, then request should be of $45. You can contact POS vendor and programmed it to only include check amount before adding a tip.

• If you are unable to authorize because of a magnetic strip of card can’t be read, you can request authorization by key entering or voice authorization center. If the request is approved, keep approval code along with sales receipt with you. If there was a voice authorization, write approval code on sale receipt. Take imprint of the card and make sure that customer signs it.

• The terminal is unable to read the chip. Accept EMV card by swiping magnetic stripe via a reader, when promoted on the screen. If terminally is chip capable then your preference should be chip reading before swipe.

• If floor limit is zero for all the transactions then you should authorize all the transactions no matter what the dollar amount is.

Recent studies have found that half of the total chargebacks were unauthorized. 81% of the cardholders admitted that filing chargeback was a convenience, they didn’t have time to contact merchant for resolving the issue.

Chargebacks can be impacted negatively if your store is expanding. Make sure that staff is trained and know general rules and procedures. Especially if you are running a restaurant or any other business where the tip is added to the amount. Staff should be instructed that they authorize for check amount and tip. If there is chip capable terminal, training on fallback procedures is necessary.