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Visa 12.2 - Incorrect Transaction Code

Transaction was processed with an incorrect transaction type code, causing improper processing.

Overview​

Transaction codes tell the network how to handle a transaction (purchase, refund, cash advance, etc.). Using the wrong code can result in incorrect processing and disputes.

When This Code Applies​

  • Wrong transaction type used
  • Credit processed as purchase
  • Purchase processed as cash advance
  • Refund processed incorrectly
  • Forced post with wrong code

Conditions for Valid Dispute​

Issuer Must Verify​

  1. Transaction code is incorrect
  2. Cardholder was negatively impacted
  3. Correct code would have different outcome

Common Code Errors​

IntendedActualProblem
PurchaseCash advanceHigher fees, interest
RefundPurchaseWrong direction of funds
DebitCreditWrong funding source
Pre-authSaleFunds captured prematurely

Time Frames​

ScenarioDispute Window
Standard120 days from transaction date

Representment Options​

1. Correct Code Was Used​

Evidence required:

  • Transaction records showing correct code
  • Processor confirmation
  • Network records

2. Code Error Did Not Impact Cardholder​

Evidence required:

  • No financial impact to cardholder
  • Transaction processed correctly despite code
  • Cardholder received expected outcome

3. System/Processor Error​

Evidence required:

  • Processor confirmation of error
  • System logs showing correct submission
  • Error was downstream

Why This Happens​

Common Causes​

  1. Manual entry errors - Wrong code selected
  2. System misconfiguration - Default code incorrect
  3. Integration bugs - API sending wrong values
  4. Processor issues - Mapping errors
  5. Terminal settings - Wrong configuration

Prevention Strategies​

System Configuration​

  1. Correct default codes - Verify terminal/gateway setup
  2. Code validation - Check codes before submission
  3. Integration testing - Verify API sends correct codes
  4. Regular audits - Review transaction code usage

Technical Controls​

  1. Code mapping review - Ensure correct mappings
  2. Test transactions - Verify in sandbox first
  3. Response validation - Check what was actually processed
  4. Monitoring - Alert on unexpected codes

Process Controls​

  1. Staff training - Know when to use which codes
  2. Documentation - Clear procedures for each transaction type
  3. Escalation - Path for unusual scenarios
  4. Reconciliation - Catch code mismatches

Win Rate Expectations​

Defense TypeExpected Win Rate
Correct code proven85-95%
No cardholder impact60-75%
Wrong code usedUnder 15%

Common Mistakes​

  1. Refund as purchase - Money goes wrong direction
  2. Recurring as one-time - Missing recurring indicator
  3. Manual with wrong code - Staff selects incorrectly
  4. No code validation - System accepts any code
  • 12.1 - Late Presentment
  • 12.3 - Incorrect Currency
  • 12.5 - Incorrect Amount

See Also​