Understanding Visa Chargeback Reason Code 13.8: Original Credit Transaction Not Accepted

Reason Code 13.8 is grouped under "Consumer Disputes". It happens if an Original Credit Transaction (OCT) sent to a cardholder or vendor is refused. As a result, the issuer reverses the payment and pushes the funds back to the merchant. They can then file a 13.8 chargeback. Importantly, this still counts towards the merchant's dispute ratio and incurs fees.

Key Takeaways

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• What it means: An OCT could not be credited to the recipient’s account. The issuer reversed it and raised a chargeback.
• Causes: Ineligible card or locality, recipient refusal, or issuer restrictions.
• How to respond: Check the reversal. Verify recipient eligibility. Supply evidence or accept and resend funds.
• How to prevent: Confirm card and jurisdiction support OCTs. Keep clear records. Try out chargeback alerts.

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What is a Visa Reason Code 13.8 Chargeback?

Visa created Reason Code 13.8 to cover situations in which an OCT is rejected after the merchant has pushed funds. An OCT moves money from the merchant straight into a Visa account in real time. It lacks the extra authorisation steps attached to a normal refund. It is popular for fast payouts, gig-economy settlements, and rapid customer refunds. 

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However, OCTs are subject to issuer and regional rules. If the card, account type, or country does not allow credits of this kind, the issuer blocks the transfer. They then reverse the posting and initiate a chargeback under 13.8. The merchant keeps the funds but gains an additional dispute on their record, plus the related fees. 

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Primary Causes for a Code 13.8 Chargeback

Most disputes under 13.8 begin with good intent. A business decides to refund a customer or pay a partner quickly, so it pushes an OCT. Problems arise when key checks are skipped. First, some issuers block OCTs on prepaid, corporate, or gift cards. Second, a number of countries limit inbound OCTs for regulatory reasons; the issuer must refuse to comply. 

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Third, the cardholder might reject the amount. For instance, they may dispute a partial credit or claim not to recognise the incoming payment. Finally, data errors such as a mistyped card number can route the credit to an ineligible account. This triggers an automated reversal. Merchant misconduct is rare in these types of disputes. However, failure to verify eligibility or send clear communication still counts as a procedural lapse. 

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Time Limit for Disputing a Visa Reason Code 13.8 Chargeback

Under Visa regulations, issuers are given a 120-day window starting from the date that the OCT was processed to file a chargeback. Once the dispute is raised, the acquirer forwards it to the merchant, who then has a strict 30-day window to submit a response or acceptance. 

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If the merchant chooses to fight the claim, the representment package must reach the acquirer before that 30-day mark or the right to contest is lost. Missing either deadline can move a case into pre-arbitration automatically, where additional fees apply and the chances of reversal shrink sharply. Mark these dates in internal systems so finance and customer-care teams act quickly.

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What 13.8 Means for Consumers & Issuers

For consumers, a 13.8 situation is less about loss of money and more about frustration. They expected a swift credit, saw nothing land, and may worry that the merchant failed to honour a promise. Issuers, on the other hand, must uphold network and local regulations. When an OCT violates those rules, they are obliged to reverse it and notify the merchant through the chargeback system. Although the issuer is returning funds to the merchant, they still expend resources reviewing the case, updating the cardholder, and processing dispute paperwork. That workload is why issuers prefer merchants to confirm OCT eligibility before sending funds. A smooth experience keeps cardholders satisfied and reduces avoidable operational burdens on issuer dispute teams.

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What 13.8 Means for Merchants

For merchants, this type of chargeback has two main consequences. The most obvious one is that, as the credit never went through, the merchant still owes money to the cardholder. It's up to them to promptly resolve this by arranging a new payment. Secondly, even though the claim arises from the merchant attempting to post a credit in good faith, it still counts as a dispute. This means it negatively affects the merchant's dispute ratio and may incur chargeback fees. 

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Multiple 13.8 cases can push a merchant toward Visa’s monitoring programme. Indirect effects include damage to customer trust and extra internal labour to untangle the case. Addressing eligibility checks, educating staff, and maintaining audit-friendly records help businesses defend against chargebacks long-term.

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How to Respond to a Code 13.8 Chargeback

Step one is to read the dispute message closely. If the issuer already reversed the OCT, verify that the funds have indeed returned and the amounts match. When the reversal did occur before the chargeback date, supply settlement logs or payment processor records proving the earlier reversal. This can compel the issuer to withdraw the claim. 

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If the cardholder has since confirmed satisfaction, perhaps because the merchant sent a fresh credit by other means, obtain written confirmation (email, secure message, or signed letter). Include that document in the representment. If neither scenario applies, accept liability promptly. Plan a compliant refund route, and inform the customer. 

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Quick acceptance can save secondary fees and avoid prolonging the dispute lifecycle. Either way, add a flag to the customer record so future credits use an allowed method. Well-documented, timely action shows banks that the merchant treats card network rules seriously. Cooperative dispute resolution is always the best option.

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Proactive Prevention: The Ultimate Defence

Prevention starts with eligibility checks built into payout workflows. Train staff and automate systems to confirm card type, issuer rules, and regional legislation before each OCT. Maintain concise records of customer consent, credit amounts, and alternate payout options. 

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Chargeback alerts give an early warning when an OCT might fail or when a dispute has been lodged. Early notice means merchants can contact the cardholder straight away, offer a different refund path, and stop the case from escalating. To add that protective layer, try out chargeback alerts and cut avoidable disputes at the source. 

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