Mastercard Chargeback Reason Code 4835: Cardholder Not Authorized/Transaction Not Authorized

What is Mastercard Chargeback Reason Code 4835?

The Mastercard chargeback reason code 4835 refers to transactions that occurred without due authorization. It falls under the “authorization” category and can relate to the cardholder's or issuer's authorization. The latter reverses the charge once it discovers it did not or could not have received adequate authorization.

Chargebacks under this reason code often occur when the cardholder cannot authorize a transaction with the card. They differ from fraud-related cases where a third party provided the authorization in the absence of the cardholder. Mastercard uses the code 4837 for fraudulent card authorizations.

We can point to several reasons why the cardholder cannot authorize a transaction. These include:

• The cardholder blocked the card earlier
• The issuer flagged the card for fraud or money laundering
• The card is expired

Issuers should reject all transactions without adequate authorization, thereby preventing chargebacks of this nature. However, initial processing might slip through, validating payment and moving money into your account. The issuers will promptly reverse the money when they discover the transaction was unauthorized, resulting in a chargeback.

Cardholders may unknowingly submit flagged or expired cards. Nonetheless, chargebacks with reason code 4835 are often issuer-generated.

The chargeback message should reveal why the transaction was unauthorized or why the cardholder could not have authorized it. With that, you can build your case and dispute it. The primary requirement is to show ample evidence of the authorization approval for the transaction.

You should take adequate steps to prevent chargebacks of this nature. Frequent occurrences might flag your merchant business as fraudulent. That hampers your reputation with customers and issuers who’d rather avoid you.

Often, an initial authorization request is denied in this category. Forcing transactions may make them successful initially, only for the issuer to reverse them.

The New 4808 Code

Chargebacks relating to authorization now fall under the 4808 reason code. This code lists several reasons why a transaction may be unauthorized. Even so, the chargeback message will contain the precise reason.

Various reasons for the lack of authorization include the following:

• The account number is not on file
• Cardholder-activated terminal (CAT) 3 device
• Expired chargeback protection period
• Multiple authorization requests
• Warning bulletin file
• The requested authorization was not obtained.

Why Did It Happen?

Chargebacks under this reason code occur when issuers discover that the disputed transactions occurred without authorization. It can be either of the following:

• The cardholder is not authorized to conduct transactions with the card: Expired cards are often the culprits in chargebacks with reason code 4835. Modern payment terminals should reject expired cards outright. However, forcing the transaction can make it successful.

Forcing transactions involves bypassing the standard authorization process. You can enter a previously obtained authorization code. Alternatively, some merchants call authorization centers and request offline codes.

Many point-of-sale terminals can force transactions through this method. However, that leaves the transaction for further scrutiny by Mastercard. The issuer can reverse it if that cardholder has no authority to conduct transactions with the card.

• The issuer did not authorize the transaction: Issuers can reject authorization requests for several reasons. Again, an expired card is enough for an issuer to reject authorization approval. Using an offline authorization code to force the transaction will result in chargebacks under reason code 4835.

It is rare but possible for cardholders to beg you to force the transaction. However, you should not do this to every random customer who buys from you. We recommend avoiding it entirely, but you can do it in exceptional scenarios according to Mastercard’s standards.

Chargebacks in this category can occur in mail orders, telephone orders, and internet transactions. Hence, be extra careful when reviewing your payments before final submission to the issuers or your acquirer.

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How to Fight Mastercard Chargeback Reason Code 4835: Cardholder Not Authorized/Transaction Not Authorized

The conditions surrounding chargebacks with reason code 4835 leave little going for you. Notwithstanding, you can dispute it if you follow the proper steps. Review the transaction thoroughly before preparing your defense or following our recommended steps.

With that in mind, here’s how you can dispute chargebacks under reason code 4835:

• If you receive adequate authorization for the transaction: Submit proof that you requested and received authorization from the issuer. The transaction amount and date should be included in your submission. That allows Mastercard to match the authorization approval with the disputed transaction.
• If the card was still valid on the transaction date: Submit proof that the disputed transaction occurred when the card was still valid. Again, submit the transaction amount and the date to match the disputed payment. Mastercard will review the card’s expiration date and when you requested and received authorization approval.
• If you did not receive authorization approval: You can’t do much to dispute the chargeback if you received no authorization approval. Accept the chargeback and take steps to prevent future occurrences.

Cards are valid through the last day of the month on their expiration date. For example, a card with an expiration date of 04/24 is valid until May 1, 2024.

Ensure you respond to the chargeback message within 30 days. Nonetheless, be thorough in your response to avoid back-and-forth or outright denial.

How to Prevent Mastercard Chargeback Reason Code 4835: Cardholder Not Authorized/Transaction Not Authorized

Chargebacks with reason code 4835 often occur when merchants force transactions. Issuers can also have oversights that approve transactions of this nature in error. Even so, you must review your operational procedures to avoid mistakes that can result in these chargebacks.

Our recommended preventive measures against chargebacks with reason code 4835 include the following:

• Do not force transactions when denied.
• Request alternative payment methods if the first method fails to receive authorization approval from the issuer.
• Update your payment terminals (hardware and software).
• Proceed with transactions only when you’ve received approval.
• Check cards for expiration dates before swiping them for processing.
• Keep records of all your transactions and review them before final submission.
• Adopt a batch approach to your transaction submissions.
• Respond to issuer inquiries quickly to resolve pending issues before they escalate to chargebacks.

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