Amex Chargeback Reason Code FR4: Immediate Chargeback Program
This is a program that allows American Express to process any dispute immediately as cardholder files a chargeback for any reason than actual fraud. This is a kind of identification service done by Amex when it receives a cardholder’s dispute based on actual fraud. In this program Amex does not send an inquiry before processing a dispute.
Most Common Causes
- Merchant enrolled himself in this program to avoid receiving inquiries and disputes.
- When merchant receives odd number of inquiries and chargebacks, Amex puts the merchant under this program.
- Merchant’s business falls under high chargeback ratio industry.
- If the merchant has issued refund to the cardholder, provide the proof of refund and also mention the date.
- If the merchant has not issued a refund to the cardholder, accept the chargeback.
Prevention tips for merchants to avoid Immediate Chargeback Program:
- Make sure to obtain an authorized approval for all the e-commerce and recurring transactions regardless of the dollar amount.
- Read back the account number, especially for transactions made via phone. Always verify account number so that there are no errors or misunderstandings.
- Identify the type of transaction, such as card-not-present, and use appropriate codes for identifying transactions as e-commerce, telephone order, and Mail order during settlement process and authorization. Usually, this will automatically be done by the processing system, or by an indicator button.
- Make sure to use security codes and AVS. These services are designed to prevent card-not-present related frauds.
- Set your billing descriptor correctly. The merchant can manage the way business name appears on the customer billing statement with the help of a tool known as billing descriptor. It usually is set up so that the merchant can display “Doing Business As “(DBA) name, but some processors may use the legal name as per default settings. The merchant can work with its processor to ensure the descriptor is set in a way that would be easier for the customers to recognize. The merchant must also ensure that all the information such as Internet address, state, city, and phone number are displayed correctly so that the customer can locate it.
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