Chargeback Reason Code

American Express Chargeback Reason Code C18: “No Show” or CARDeposit Canceled

General Information about Reason Codes

In 2016, Mastercard chargeback reason codes were condensed and consolidated, in a restructuring that resembled Visa Claims Resolution. Prior to this, Mastercard’s list of reason codes was long, convoluted, and confusing; now there are fewer than ten different reason codes relevant to most merchants. All the old reasons are still there, but they’ve been grouped under more comprehensive “umbrella” codes.

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American Express Chargeback Reason Code C18: “No Show” or CARDeposit Canceled

What is American Express Chargeback Reason Code C18?

The AmEx chargeback reason code C18 deals with cardholder complaints about canceling a lodging reservation but not receiving the refund. It can also cover cardholder complaints about canceling a lodging reservation and still being debited for the transaction. This reason code is limited to merchants providing lodging services to travelers.

Merchants making lodging reservations are expected to have cancellation or “no-show” policies. Of course, we understand the need to protect your business against sudden cancellations or no-shows. American Express makes adequate provisions for this through its Assured Reservations and CARDeposit programs.

The Assured Reservations program mandates that all AmEx cards accept prepaid cards. It also recommends informing the cardholder of your reservation policy, including the time frame to cancel reservations. However, it is up to you to process cancellations quickly before a dissatisfied cardholder files a dispute with American Express.

You may charge a “no show” fee if a cardholder does not show up for the reservation. This charge can also apply if the cardholder changes or reschedules the reservation outside your permitted time frame. American Express can process chargebacks if they believe your “no-show” charge was inappropriate (based on the presented evidence).

The CARDeposit program ensures you get advanced bookings for reservations. Hence, cardholders are likely to file for a refund when they cancel the reservation or fail to show up.

American Express has specific rules concerning reservations. Failing to follow them can cause chargebacks under this reason code even when you maintain good business ethics. We’ll discuss these in the section on how to prevent the chargeback reason code.

In the meantime, we’ll review AmEx’s reasons for chargebacks under this code. Don’t worry if you did everything right and still incurred the chargeback.

Why Did It Happen?

Chargebacks with reason code C18 occur when cardholders believe they shouldn’t be billed for a canceled reservation. The expected steps for resolution would be to contact you regarding any unwarranted billing. Cardholders should also contact you if they cancel a reservation and expect a refund.

According to American Express, the following are the most likely reasons for chargebacks under reason code C18:

  • You did not process the reservation's cancellation, and the cardholder contacted AmEx. This could be an oversight on your end, or you planned to process the cancellation at a future date.
  • The cardholder expected a refund for the canceled reservation as promised, but you did not issue the credit. - a communication breakdown when you encounter challenges in processing a refund will leave the cardholder dissatisfied. Hence, they may file a dispute with American Express, submitting evidence to show your promise for a refund at the said date or within a time frame.
  • The cardholder was debited for the reservation before a credit was posted to their statement. This happens if you process the cancellation too late. If cardholders expect the credit in their next statement and don’t see it, they will likely file disputes for a chargeback.
  • The cardholder does not fully grasp your cancellation policy, including deadlines and when they can expect a refund. Although filing disputes for chargebacks in this case would be a cardholder error, it is still possible for you to incur the chargebacks.
  • The cardholder canceled the reservation outside of your cancellation or refund policy but was unaware. In this case, American Express can still process a chargeback, although it is less likely to do so.
  • The cardholder made several unsuccessful attempts to cancel the reservation. This will lead to disputes if the cardholder gets debited for the transaction they tried so hard to cancel.
  • You did not process the deposit charge promptly. Hence, the debit transaction occurred after the cardholder canceled the reservation.


How to Fight AmEx Chargeback Reason Code C18: “No Show” or CARDeposit Canceled

We’d like to point out a few things before we get to the ways to fight chargebacks under this reason code. Note the following:

  • Respond quickly to American Express
  • Provide all documentation American Express requests for and any additional and helpful information.
  • Ensure your written response thoroughly addresses the dispute's reason.

American Express gives merchants 20 days to respond to chargebacks. If you are ready, do the following:

  • Provide documents to show that the “no show” fee is valid. Your reservation policy should suffice.
  • Provide documents to show that the cancellation violated your reservation policy. It could be that the cardholder canceled outside of the time frame or did not adhere to another condition for cancellation. You’ll need a copy of your reservation policy to prove this case.
  • Provide documents to show that you have already processed a credit to offset the charge. The receipt should show the amount and date of the transaction. If the amount matches the chargeback, American Express should refund you.
  • Provide proof that you complied with the cardholder's request for an alternative accommodation. Although rare, some cardholders may be unaware that they requested or agreed to this change.

How to Prevent AmEx Chargeback Reason Code C18: “No Show” or CARDeposit Canceled

A clear reservation policy should keep chargebacks under this reason code away. Nevertheless, it is not a complete guarantee. Hence, we recommend that you do the following to boost your preventive measures:

  • Process cancellation requests quickly. If there will be any delays, inform the cardholder and ensure they respond appropriately.
  • Submit the credit on the same day the cardholder cancels the reservation. If that is not possible, inform the cardholder when the credit will be processed. That will keep them from expecting it in the current account statement and filing disputes when they don’t see it.
  • Provide a cancellation number for confirmation when a cardholder cancels a reservation.
  • Log all the cancellation or confirmation numbers as the Assured Reservation and CARDeposit programs require.
  • Ensure that the cardholder knows your cancellation policy when making the reservation. You should include it in the final receipt before the cardholder approves the transaction.
  • Ensure cardholders accept your reservation terms and conditions before completing the transaction. 

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