Visa Chargeback Reason Code 12.3: Incorrect Currency

Definition: Visa chargeback reason code 12.3 refers to situations where the transaction was processed in a different currency than what was specified by the cardholder or agreed upon with the merchant. This can occur when there is a mismatch between the currency indicated on the transaction receipt and the currency in which the transaction was processed.

Causes:

• Merchant Error: The merchant processed the transaction in a different currency than what was agreed upon with the cardholder.
• Technical Issue: A system error or configuration issue caused the transaction to be processed in the incorrect currency.
• Communication Breakdown: Miscommunication between the merchant and the cardholder regarding the currency to be used.

Resolution Time Frame:

• For Consumers: Cardholders typically have up to 120 days from the transaction processing date to dispute the charge.
• For Merchants: Merchants must respond to the chargeback within the time frame specified by their acquiring bank, which is usually around 30 days from the chargeback notification date.

Prevention and Mitigation:

1. Ensure Clear Communication:
   • Clearly display the transaction currency to the cardholder before finalizing the transaction.
   • Include currency information on receipts and confirmation emails.
2. Proper System Configuration:
   • Regularly check and update point-of-sale (POS) systems to ensure they are configured to process transactions in the correct currency.
3. Staff Training:
   • Train staff to confirm the transaction currency with the customer before processing the payment.
4. Transaction Review:
   • Implement a review process for transactions to ensure they are processed in the correct currency.
5. Use Dynamic Currency Conversion (DCC) Wisely:
   • If offering DCC, make sure cardholders are aware of the option and consent to the currency conversion.
6. Documentation and Record-Keeping:
   • Keep thorough records of all transactions, including currency details, to provide evidence in case of disputes.

Handling Chargebacks:

1. Investigate the Claim:
   • Review the transaction details and any communication with the cardholder regarding the currency.
2. Respond Promptly:
   • Submit a response to the acquiring bank with evidence supporting the correct currency was used, if applicable.
3. Issue a Refund if Necessary:
   • If the error was on the merchant’s side, consider issuing a refund to resolve the issue amicably.
4. Monitor Disputes:
   • Track chargeback trends to identify recurring issues and address them proactively.