Discover Chargeback Reason Code IN: Invalid Card Number

What is Discover Chargeback Reason Code IN?

The Discover chargeback reason code IN indicates chargebacks involving unassigned, invalid, or incorrect card numbers. This error is more prevalent in offline sales, where the merchant types the card number at the payment terminal. It can also occur in online orders where the customer does the typing.

This chargeback code falls under processing errors with the shorthand description, “invalid card number.” Most payment or POS terminals can identify mistyped card numbers and decline the transaction. However, a system glitch may allow such transactions to go through.

Downtime authorization is a prominent reason for chargebacks with reason code IN. This is when you use an alternative authorization service when the proper channel is unavailable. It can occur when the issuer fails to recognize a card during payment.

An example of downtime authorization is calling a toll-free number to request authorization from a live agent. We’ll discuss this more in the subsequent section.

Chargebacks with this code have little to nothing to do with cardholders. Hence, do not expect to deal with a cardholder dispute. The parties involved are your acquirer, the issuer, and you.

What happens is that the issuer realizes the processing error and processes a chargeback. You may receive a notification before the chargeback is processed. However, this is only sometimes the case.

The challenge you will have comes when the customer successfully purchases the item while this processing error occurs. You shouldn’t be liable for the charge if the error came from the card network. However, the chargeback can be challenging to fight if you enter the wrong card number.

If you are confident in the card number entered at the time of purchase, you can proceed to dispute the chargeback. Otherwise, you must accept the chargeback and work towards preventing future occurrences.

Why Did It Happen?

Chargebacks with reason code IN occur when the card number entered during a transaction is unassigned to the cardholder or invalid. They occur in offline and online sales, where the card details are entered to complete the transaction. While other details point to or validate the cardholder, the card number differs from what was assigned.

The most likely causes for chargebacks under this code include the following

• Mistyping the card number during a transaction
• Using downtime authorization when the issuer network is unavailable to verify the card electronically

While most terminals or systems will flag mistyped card numbers, that may only sometimes be true. Hence, transactions may pull through with the error, making your business liable for a chargeback.

Most issuers provide downtime authorization in moments of network unavailability. This enables merchants to carry out crucial transactions that are time-sensitive.

However, card issuers often have some card numbers that are ineligible for downtime authorizations. These numbers are stored in a negative file, and all downtime authorization requests must be compared with the file. If that didn’t happen and your cardholder’s number is in the file, the issuer will process a chargeback.

The negative file helps issuers prevent fraudulent and unauthorized transactions. While initial processing might allow the transaction, a subsequent review can cause the issuer to reverse the charge.

Processing charges on expired or closed accounts may also cause chargebacks with the reason code IN. However, this is less frequent than the other two causes mentioned earlier.

Don’t assume that the reasons for the chargeback will always be within those mentioned here. These are the more common ones. Always confirm with your acquirer to be sure of the cause.

You can ask for clarifications. Ensure you understand the reason before responding. The following section will elaborate on responses and directions.

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How to Fight Discover Chargeback Reason Code IN: Invalid Card Number

You cannot do much if you confirm that the card number was mistyped while processing the payment. The best approach is to concede the chargeback and avoid future occurrences.

Once the chargeback message arrives, you have 30 days to respond. Your response will be directed to Discover Network through your acquirer. You can also contact your acquirer for additional details or advice on responding.

With that in mind, only respond according to the guide below:

• Submit evidence that the card number is correct: System glitches may cause valid numbers to appear invalid. If you have enough details from the cardholder, you can prove that the number you typed is the same as the one on the card.
• If the card number was not in the negative file at the time of authorization: Submit evidence that the number was not in the negative file. It could be a confirmation from the live agent during authorization.
• Submit a copy of the authorization code you received during the transaction. That will take the liability away from you to the issuer.
• For mail or telephone orders: submit evidence of receiving authorization for the transaction
• For expired cards: Submit evidence containing the date and time of the transaction. That will prove that the transaction occurred before the card expired.

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How to Prevent Discover Chargeback Reason Code IN: Invalid Card Number

Avoiding situations where you manually enter a card number will prevent chargebacks with reason code IN. If your payment terminals are outdated but still functional, now is the time to upgrade them. Chargebacks with this reason code rarely occur in card-swiping transactions.

Always obtain authorization for online, telephone, or mail orders. Keep records of these authorizations in the event of a chargeback.

Here are steps to preventing chargebacks with reason code IN:

• Check the negative file before using downtime authorization to confirm the card number is not among them.
• Update your payment terminals to avoid manually entering a card number
• Wait for authorization approval before processing a transaction
• Avoid downtime authorization except where necessary and time-sensitive
• Double-check card numbers entered manually before processing the transaction
• Ensure you process only active cards. Always check the expiration date on each card before processing
• Review customer-entered card numbers before finalizing the transaction
• Avoid forcing declined transactions. Instead, request an alternative payment method or card.

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