Chargeback Reason Code

Discover Chargeback Reason Code SV: Services Not Rendered

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, Mastercardā€™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 theyā€™ve been grouped under more comprehensive ā€œumbrellaā€ codes.

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Discover Chargeback Reason Code SV: Services Not Rendered

What is Discover Network Chargeback Reason Code SV?

Cardholders can request online and offline services, pay for them, and expect delivery on the agreed date. Discover Network uses the chargeback reason code SV to indicate chargebacks involving non-rendering of purchased services. They fall under the ā€œservicesā€ category and are often instigated by cardholders.

Discover Network can use this reason code for online and offline transactions involving services. Examples of physical services include facility maintenance, physical installations, accommodation, travel, etc. You may find chargebacks under this reason code more often if you operate a hospitality business.

Online services can be software support. There is a thin line between selling software as a product and selling it as a service. The latter involves providing ongoing support that the user needs to work.

Chargebacks under this reason code apply to online (card-absent) and offline (card-present) orders. Telephone and mail orders are also included, provided the endpoint is the provision of services.

Merchant oversight is often the cause of disputed transactions that result in chargebacks under this reason code. Cardholders may also regard service delays as unacceptable and still demand a refund. The latter will reach the issuer if you fail to provide the credit transaction.

Hereā€™s an overview of the kinds of disputes thatā€™ll prompt Discover Network to use this reason code:

  • The cardholder paid for the service, online or offline (telephone orders are included)
  • An execution date was set
  • You failed to execute the service on the agreed date

Some services require immediate execution. An online subscription is an ideal example. A cardholder who pays for an online subscription expects the software to be available immediately.

Review the transaction thoroughly before preparing your response to this chargeback message. You can reverse the chargeback with compelling evidence. The key is proving that you executed the service on the agreed-upon date or timeline.

Weā€™ll review the possible approaches to fighting chargebacks under this reason code. You can always refer to the Discover Network Dispute System (DNDS) to manage your chargebacks effectively. If necessary, ask for more details.

Take chargebacks with this reason code seriously and do your best to prevent them. Frequent occurrences might cause blocklisting as a fraudulent merchant service.

Why Did It Happen?

Discover Network will process a chargeback when the cardholder claims that you failed to provide the service purchased. You should receive an inquiry for more details before the issuer escalates to a chargeback. However, that might not be the case, or your response was inadequate to stop the chargeback.

Hereā€™s why Discover Network processes a chargeback under this reason code:

  • Failure to provide the purchase service: Non-provision of the purchased service will inevitably lead to a chargeback when the cardholder files a complaint. The same can be said if you donā€™t provide a satisfactory reason to the cardholder as to the delay. Sometimes, cardholders can be pacified with a reasonable excuse.

Donā€™t expect to pacify all buyers, regardless of how soothing your communication skills are. Some cardholders will ask for their money once dissatisfied with your service. Refusing their request will result in complaints that will likely escalate to a chargeback.

  • Wrongful claim from the cardholder: Cold feet is still a thing the same way buyerā€™s remorse is. Some cardholders may request a refund and hurriedly complain to their issuers. We understand that things can get complicated with cloud services when a subscriber accidentally uses the service before requesting a refund.
  • Delay in processing a refund: You can expect some subscribers to request a refund even before using your service. Things will be easy for services where you can monitor usage for specific IP addresses. You can quickly process a refund in that case.

Other times, it might be challenging to determine the usage. Delaying a refund will likely cause the cardholder to file complaints with the issuer.

A takeaway from this section is that the cardholder must dispute the transaction before Discover Network processes a chargeback. Some people might want to take advantage of that and complain even after receiving your service. We would classify this as actual fraud.


How to Fight Discover Network Chargeback Reason Code SV: Services Not Rendered

The primary way to dispute chargebacks with this reason code is to prove that you provided the service. Anything outside that is unacceptable.

Discover Network provides a 30-day window to prepare and send your response. Include compelling evidence to dispute the cardholderā€™s claims. Technicalities might be required with cloud services or downloadable services.

With that in mind, hereā€™s how to dispute chargebacks under reason code SV:

  • If you provided the service: Provide evidence that you carried out the service on the agreed date. The documentation might also include the cardholderā€™s usage of the service. For cloud services, you can send the usage data for the cardholderā€™s IP address to show the service was provided and used.
  • If the chargeback occurred before the delivery date: Submit details of the contract that show the delivery date. Compare the dates of the chargeback and delivery to show that Discover Network processed the chargeback before you delivered the service.
  • A balance is still pending: Provide evidence of the balance owed. Show that the balance is necessary to provide the service to the cardholder.
  • If the cancellation violated your policy: Show that the cardholderā€™s cancellation order violated your policies. Hence, the cardholder is not eligible for a refund.
  • If the cardholder was refunded: Include details of the credit transaction. The date and time should be available.

Accept the chargeback if none of the above conditions hold. The best you can do is to implement preventive measures.

How to Prevent Discover Network Chargeback Reason Code SV: Services Not Rendered

The following are our recommended preventive measures for chargebacks under reason code SV:

  • Ensure cardholders are aware of your cancellation policy at payment checkout.
  • Inform cardholders of any delay in the provision of services.
  • Respond to customer complaints calmly.
  • Process cancellation requests and issue a refund as soon as possible.
  • Warn cardholders about using VPNs for your cloud services.


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