Credit Not Processed

Owned by Devan Robertson
Last updated: Feb 25, 2022
3 min read

Conditions

The cardholder contacted the issuer claiming one of the following:

  • The merchant failed to disclose its refund policy at the time of the transaction and is unwilling to accept a return or cancellation of goods or services
  • The merchant has not responded to the return or the cancellation of goods or services
  • The merchant posted a credit for a reduced amount without proper disclosure
  • The merchant failed to issue a Value Added Tax (VAT) credit

22.1 Mandate

Travel/Entertainment Services Cancelled/Returned and Credit Not Processed

Both of the following:

  1. The cardholder contacted the issuer claiming all of the following:

    • The merchant agreed to provide a refund and failed to process that refund

    • The merchant failed to disclose its refund policy at the time of the transaction

      and is unwilling to accept the cardholder’s return or cancellation of goods or services.

    • The merchant has not responded to the cardholder’s return or cancellation of goods or services.

    • The merchant posted a credit for a reduced amount without proper disclosure.

  2. The transaction was identified with one of the following MCCs:
    • Airlines and Air Carrier (MCCs 3000 through 3350, 4511)
    • Car Rental Agencies (MCCs 3351 through 3500, 7512)
    • Cruise Lines (MCC 4411)
    • Lodging-Hotels, Motels, Resorts (MCCs 3501 through 3999, 7011)
    • Motor Home and Recreational Vehicle Rental (MCC 7519)
    • Real Estate Agents and Managers—Rentals (MCC 6513)
    • Theatrical Producers, Ticket Agencies (excluding Motion Picture) (MCC 7922)
    • Travel Agencies and Tour Operators (MCC 4722)

Time Limits

22.1 Mandate

Travel/Entertainment Services Cancelled/Returned and Credit Not Processed

Both of the following:

  1. Between 15 and 120-calendar days from the date on the credit documentation, or the date the service was canceled, or the goods were returned.
    1. When waiting the 15-calendar days would cause the issuer to exceed the 120-calendar day time frame, the issuer may chargeback the transaction earlier than 15-calendar days.
    2. When the credit documentation is dated, the date on the credit documentation is counted as day zero.
    3. When the credit documentation is undated, the date on the cardholder letter, email, message, or Dispute Resolution Form—Cardholder Dispute Chargeback (Form 1221) is counted as day zero.
    4. When the cardholder letter is undated, the receipt date of the documentation by the issuer is counted as day zero.
      1. The issuer can immediately charge back the transaction upon receiving one of the following forms of credit documentation:
      2. A letter from the merchant advising the issuer to obtain credit using a chargeback
      3. Proof of an improperly disclosed in-store credit
      4. A TID voided by the merchant
  2. For transactions completed using a card issued in either Canada or the United States at a merchant located in either Canada or the United States: Within 540-calendar days from the Central Site Business Date of the original transaction.  For all other transactions: Within 365-calendar days from the original expected delivery or performance date specified by the merchant. 

Dependencies

  • A cardholder letter, email, message, or completed Dispute Resolution Form describing the cardholder’s complaint in sufficient detail to enable all parties to understand the dispute.
  • Acquirer Reference Number (ARN) of the credit transaction (For improperly disclosed partial credits)
    • During intake, the user is prompted to select the valid transaction, when applicable.  If the ARN for the selected transaction is not available from the transaction service, it will be collected in the MC Related Transaction Enrichment flow.
  • Merchant documentation to support a credit is due to the cardholder (Optional)
  • Proof of an improperly disclosed in-store credit and cardholder explanation (Optional)

Validations

None.

Related Questionnaires

Cancelled or Returned Merchandise or Service / Credit Not Processed | Mastercard

Notes

Proper Disclosure

Merchants that are unwilling to accept buyer’s remorse returns and cancellations or that want to have special terms including (but not limited to) restocking fees or in-store credits, must disclose these terms at the time of the transaction. The cardholder must be informed of the refund policy as described in the Transaction Processing Rules, section 3.11 Specific Terms of Transaction. Failure to disclose a refund policy will result in the merchant’s requirement to accept the goods for return and issue a credit.


When the merchant informed the cardholder of its refund policy at the time of purchase, the cardholder must abide by that policy. For example, the cardholder’s sales slip clearly indicates that the refund policy is “in-store credit only” or “no refunds.”