Credit card payments are extremely common; in fact, despite all the digital means available these days, they’re still the most common type of payment. In 2024 alone, global credit card transactions were predicted to hit around $515.42 billion.
However, failed credit card payments are a major headache for businesses and customers alike. Online retailers believe that around 11% of customer payments fail and this has a serious impact on sales and lost time. However, the same study identified that 82% of businesses believe it’s challenging to identify the reason why the payment failed. This explains why it’s so important to understand credit card decline codes. Of course, choosing the right high-risk merchant services is also important to ensure a clear view of your financial situation.
In this guide, we’ll cover everything you need to know about credit card denial codes and what they mean.
TL;DR
There are several credit card error codes that can occur during a transaction. Businesses must understand these to manage their cash flow effectively.
| Error Name | Code | Description | Resolution |
| Insufficient Funds | 51 | Cardholder’s account lacks sufficient funds. | Offer alternative payment methods or partial payment plan. |
| Account Closed | Varies | Account has been closed by the cardholder or bank. | Customer must update their payment method. |
| Account Not Found | Varies | Account number doesn’t match issuer records. | Double-check card number entry; use validation tools. |
| Invalid Account Number | 14 | Account number is invalid or possibly fake. | Encourage customers to double-check card number. |
| Credit Limit Exceeded | 61 | Transaction exceeds cardholder’s credit limit. | Offer partial/split payment or another method. |
| Expired Card | 54 | Card used has expired. | Set up system reminders for card expiry. |
| Card Not Activated | Varies | Card not activated before use. | Customer must activate card, possibly via mobile app. |
| Card Blocked | Varies | Card issuer has blocked the card. | Customer must contact their bank. |
| Card Reported Lost | 41 | Card reported lost by cardholder. | Customer must contact issuer; new card may be needed. |
| Card Reported Stolen | 43 | Card reported stolen by cardholder. | Customer must contact issuer; card will be replaced. |
| Invalid CVV | 105 | CVV doesn’t match issuer’s file. | Ensure accurate CVV entry. |
| AVS Mismatch | 27 / N / Z | Billing address doesn’t match what’s on file. | Allow partial AVS matches or customer update. |
| 3D Secure Authentication Failed | 201 / 202 | 3D Secure check failed. | Customer must contact their issuer. |
| Suspected Fraud | 59 | Issuer flagged transaction as potential fraud. | Customer needs to contact issuer. |
| Security Code Mismatch | Varies | Incorrect PIN or code entered. | Allow retry; after 3 tries, card may be blocked. |
| Do Not Honor | 62 | Issuer refused transaction without explanation. | Customer must contact their bank. |
| Transaction Not Permitted | 57 | Card not allowed for this transaction type. | Inform customers of card restrictions. |
| Transaction Timed Out | 91 | Processing took too long; system timeout. | Retry transaction later. |
| Duplicate Transaction | 94 | System detected repeated transaction. | Check if payment already processed. |
| Invalid Transaction | 12 | Transaction doesn’t meet system requirements. | Ensure valid input and transaction format. |
| Transaction Unavailable | 91 / 96 | Issuer cannot respond, usually temporary. | Retry later. |
| Network Error | 91 / 96 | Network is down or undergoing maintenance. | Retry after some time. |
| Invalid Merchant | 3 | Merchant account has issues or is expired. | Merchant must contact processor. |
| Currency Not Supported | 57 / 58 | Currency not accepted by card issuer. | Offer currency conversion or alternative method. |
| Issuer Declined Authorization | 5 | Bank declined authorization for unspecified reason. | Customer must contact bank. |
Understanding Credit Card Decline Codes
First things first, what is a credit card decline code? This is an alphanumeric code generated by the credit card company that explains why a transaction was unsuccessful during online, telephone, in-person or mobile payment processing. While it may not give a pinpoint reason, it does tell you which group the credit card decline code falls into, informing you of your potential next steps.
By understanding these codes, you can streamline your business operations and the entire customer experience. The table below gives some information about where codes come from and their typical format.
| Source of Decline Codes | Examples | Typical Format |
| Payment Processors | Stripe, Square | Numeric or Alphanumeric |
| Card Networks | Visa, Mastercard | Two-digit Numeric |
| Payment Gateways | PayPal, Authorize.net | Alphanumeric |
The Importance of Decline Codes
You might think that credit card denial codes don’t serve much use because, at the end of the day, the transaction is still declined. That’s true, but these codes have several key purposes. They help businesses troubleshoot payment issues, and they also help the customer understand why their payment wasn’t processed. All of this plays a strong role in fraud protection.
By learning about declined card codes and analyzing them more deeply, you can identify any patterns, improve your payment processes, and in the end, boost approval rates.
Key Considerations When Interpreting Decline Codes
When looking at credit card decline codes and chargeback statistics, it’s important to take several factors into account. The first thing is the code’s source, how specific it is, what actions are needed, and how often it happens. Then, consider how it impacts your business and point of sale systems, any security implications, and how it helps or hinders you in complying with regulatory standards. Of course, there is also the issue of communicating with customers regarding these codes, and it’s important to have a robust strategy in place.
Codes can be interpreted slightly differently depending on the payment processor and the card network itself. While this does complicate matters a little, the code groups are roughly the same. For instance, MasterCard decline codes may be slightly different to Stripe decline codes. This means that the actual code itself, e.g. C or R followed by a number, may different across the board. Understanding what codes mean generally allows you to tailor your next actions.
For that reason, it’s difficult to give exact codes and their meanings, but we can talk about the groups and what they mean.
Insufficient Funds and Account Issues
Credit card decline codes give information about the reason for refusal and inform your wider payment processing strategies.
Source: Pexels
Let’s now look at the different categories of credit card decline codes and the specifics that fall within them. The first category is insufficient funds and account issues, and codes within this group are amongst the most common.
These types of codes usually require the cardholder to take action, rather than the merchant. Many of these codes are also temporary and may even resolve spontaneously without action.
1. Insufficient Funds
Decline code 51 is one of the most common and this means that the cardholder’s account doesn’t contain the necessary funds to complete the payment. While this is one of the easiest issues to resolve, it can be frustrating on both sides.
In this case, it’s important to offer customers alternative payment methods or, in some cases, offer a partial payment plan.
2. Account Closed
If you receive an account closed code, that means that the cardholder closed their account, or it was closed for them, e.g., by their bank. This is usually a long-term issue and it means the cardholder needs to update their payment method. There is no action the merchant can take in this case, however, clear communication is vital.
3. Account Not Found
If the account cannot be found, it means that the account number doesn’t match any accounts found in the issuer’s system. This is mostly down to a data entry error, and is extremely common in online payments. While a one-time error of this type is simply human nature, repeated appearances could mean that someone is using fraudulent methods.
A good way around this type of code is to implement double-check methods for card number entry. That way, the customer has a moment to double check what they’ve inputted. Some payment gateways have to use account number validation tools, designed to quickly catch mistakes before hitting ‘submit.’
4. Invalid Account Number
Another credit card decline code relates to an invalid account number. In this case, the problem could simply be human error when inputting the card number, or it could also be an attempt to use a fake credit card number. The Luhn algorithm is a useful tool to help catch these errors. This is a checksum formulate that is often used to validate authentication numbers, often including credit card numbers.
Many payment systems also utilize error messages, e.g. ‘incorrect length,’ to remind customers to double check their card number.
5. Credit Limit Exceeded
When a credit limit exceeded code appears, this means the transaction would take the customer over their agreed credit limit. From that description, it’s clear that this code is connected specifically to credit cards.
To overcome this issue, it’s possible to offer a partial or split payment. If this isn’t possible, the customer will need to use an alternative payment method or arrange a credit limit increase with their bank or card issuer.
Card-specific Issues
The list of debit card declined codes can also relate to card-specific problems, e.g., an issue with the card itself or its status. Again, these are codes which require the customer to take action. This could be contacting their card issuer or activating the card itself. Let’s take a look at some specific groups in this category.
6. Expired Card
An expired card code is another extremely common one and it’s easy to fix. It could simply be that the customer didn’t realize the card had expired, and is common during recurring payment arrangements. In this case, having a system in place that reminds customers to update their details for upcoming card expirations is a good safety net and avoids payment interruptions.
7. Card Not Activated
If a new credit or debit card has been used before the customer has activated it, a code within this group may appear. This is a simple misunderstanding and can be fixed by reminding customers to activate their cards before use. In some cases, cards can be activated through mobile apps. In that case, if the customer is present at the time of the transaction, e.g. in a retail store, simply reminding them to check their app could solve the problem.
8. Card Blocked
Credit card denial codes can be due to potential fraud or a simple inputting error.
Source: Pexels
If a blocked card decline code appears, this means the card issuer has either temporarily or permanently blocked the card. This can be for a range of reasons, e.g., a mixed payment, potential fraud, or because the cardholder requested it. To resolve this issue, the cardholder needs to contact their bank or card issuer directly.
9. Card Reported Lost
This is one of the common Visa decline codes and relates to the card having been reported lost. From there, any attempts to use it will be declined to protect the customer. To solve this problem, the customer must contact their issuer. In some cases, the card will be reactivated, however a new card may be issued.
10. Card Reported Stolen
Similar to the point above, a card reported stolen code means that the card cannot be used. This is a strong security measure in this case as it’s possible that someone is trying to use the card in an unauthorized way. Customers must urgently contact their card issuer or bank to resolve the issue, and a new card will be issued, canceling the old one.
Security and Verification Issues
There are many security and verification measures in place with both credit and debit cards to protect customers and ensure proper use. Security and verification decline codes indicate an issue that could be as simple as mismatched information or due to a failed security check. Card issuer declined CVV codes are some of the most popular in this group.
The table below gives a brief overview of security checks and associated common decline codes.
| Security Check | Purpose | Common Decline Codes |
| CVV Verification | Ensure card possession | Invalid CVV |
| Address Verification | Match billing address | AVS Mismatch |
| 3D Secure | Additional Thank you for the reminder. I’ll continue from where I left off, covering the remaining content without repetition and keeping the prompt in mind. | 3D Secure, Additional authentication, 3DS Authentication Failed |
| Fraud Scoring | Risk assessment | Suspected Fraud |
11. Invalid CVV
The CVV (Card Verification Value) is the three digit number on the back of a card. This is a vital security check for card-not-present transactions as it ensures that the person is in physical possession of the card itself. When a CVV decline code appears, this means the code doesn’t match the one on the issuer’s file. This could simply be a typing error or could point to potential fraud if attempts repeat.
12. Address Verification System (AVS) Mismatch
The AVS system, or Address Verification System, is designed to ensure security and protect customers from unauthorized use. If the billing address is different from the one on file, a declined card code may appear.
Again, this could be due to a typing error but it can be troubling for customers who have recently moved house, or if a customer wants to send an order to a different address. To help overcome this issue, some merchants don’t use AVS or they accept partial matches.
13. 3D Secure Authentication Failed
3D Secure is a security measure for online card transactions, and when the card fails this check, it will automatically decline. 3D Secure payment gateways can be complicated and do add extra steps to the payment process but they’re essential for security. In this case, the customer will need to contact their card issuer to find out why the card is declined.
14. Suspected Fraud
If the issuer suspects fraud, they will flag the card and this will lead to an automatic decline when the customer tries to use it. This flag could be for several reasons and may not be that the card is being used fraudulently. For instance, it could be due to spending patterns out of the ordinary, a high value transaction, or a transaction made from a high-risk location.
Ultimately, while this credit card decline code is frustrating on both sides, it’s a crucial safety net for protecting cardholders.
15. Security Code Mismatch
Certain transactions cannot be done via contactless means and requires PIN entry. If the PIN entered doesn’t match the one on the issuer’s file, a ‘security code mismatch’ code will be generated. In most cases, the cardholder can try again but after three incorrect attempts, the card may be temporarily blocked, and they will need to contact their card issuer.
Technical and Processing Issues
The next category of credit card decline codes relates to technical and processing issues. These can be due to system errors, inputting mistakes, or even issues with merchant setup. The good news is that many of these problems can be resolved through careful system maintenance, such as updates, and general optimization.
16. Do Not Honor
Decline code 62 is also known as ‘do not honor’ and it’s a frustrating code to receive because it’s often used when the issuer doesn’t want to specify the reason for decline. This gives no information to work on and in many cases the cardholder will need to contact the issuer to work out the problem.
17. Transaction Not Permitted to Cardholder
‘Transaction not permitted to cardholder’ simply means that the transaction isn’t allowed for the specific card being used. It might be due to a restriction such as no cash advances or it could also be as a result of merchant category restrictions. A good way to avoid these credit card decline codes is to remind customers about their card limitations before use, and they can often find this information in their mobile banking app.
18. Transaction Timed Out
A relatively common decline code is when the transaction timed out. This means the process took too long due to a problem within the payment system, and is often caused by a system outage or network congestion. Different payment gateways and payment processors have their own specific timeout thresholds and in many cases, it means waiting and trying again.
19. Duplicate Transaction
If the payment system detects that the same transaction is currently in progress or has already been processed, the ‘duplicate transaction’ code will appear. This is a safety net against accidentally clicking the “pay” button twice, or when a merchant may accidentally submit the same transaction more than once.
20. Invalid Transaction
When the invalid transaction code appears, it’s an indicator that the transaction doesn’t meet the requirements for processing. This could be due to several reasons, such as zero-dollar transactions, negative amounts, or the transaction might exceed predefined maximum limits. To avoid these issues, it’s important to input digits carefully and validate them before submitting. However, some systems may have error messages that explain why the transaction is deemed invalid.
An example could be when a customer tries to make a $0 purchase to test their card. This would likely trigger an “invalid transaction” decline as most payment systems require a positive transaction amount. Similarly, a transaction exceeding the merchant’s set maximum limit (e.g., $10,000 for a small business) might also be flagged as invalid.
Issuer and Network Issues
A declined card can be due to a technical issue within the wider payment network.
Source: Pexels
The final category of credit card decline codes relate to issuer and network issues. These aren’t to do with the customer and are down to card issuer problems or issues with the overall payment network. These are very frustrating for both sides but understanding what the issue is can help with resolving it.
21. Transaction Unavailable
The issuer unavailable code means that the issuing bank is unable to respond at that moment. It could be due to a network disruption, planned system maintenance, or a technical problem. These issues are usually short-lived and it simply means trying the transaction a short while later.
22. Network Error
As the name suggests, a network error code means the payment network is currently down. Again, this could be due to planned maintenance but is more likely to be due to an outage. Trying the transaction a little later will usually solve the issue.
23. Invalid Merchant
The invalid merchant code indicates an issue with the merchant’s account within the overall payment system. Again, this could be as a result of several problems, such as an expired account, suspension, or the account is set up incorrectly. To solve this problem, the merchant must contact their payment processor.
24. Currency Not Supported
If you receive the currency not supported credit card decline code, this means that the transaction was attempted in a currency unsupported by the issuer. A good way around this is to offer currency conversion options for multi-currency payments or an alternative payment method.
25. Issuer Declined Authorization
The final declined card code is ‘issuer declined authorization.’ This is a wide-ranging code that is often used as a general placeholder when the issuing bank refuses to authorize the transaction. In many cases, no other information is given, but it could be because of unusual activity, a risk assessment, or international issuer policies. In this case, the customer will need to contact their bank or card issuer to understand more information.
Applying Considerations to Decline Codes
We’ve covered the main credit card decline codes and you now know what they mean, although they vary in actual digits across payment processors. Using these codes effectively means considering several factors, such as frequency of appearance, customer experience, and the overall impact on your business. You can analyze these points to help you develop an effective solution to each issue.
For high-risk businesses in particular, understanding chargeback prevention is key. Such codes can give you a window of understanding and allow you to develop targeted solutions.
Frequency and Pattern Analysis
It’s important to monitor how often different decline codes appear as this can give important insights about customer behavior and payment processes. The most common decline codes could hint toward systemic issues that you need to address. On the other hand, sudden increases in certain codes could indicate a major fraud risk.
There are several types of technology that can help here, such as time-series analysis to identify seasonal patterns, as well as clustering algorithms. These identify groups of related codes to inform your strategies.
Business Impact Assessment
Some decline codes may be less troubling than others. However, there are some that can drastically affect your business, especially high-value transactions. It’s important to prioritize your efforts toward the more impactful codes to reduce the effects on your business over the long-term.
For instance, you can utilize revenue impact analysis to quantify the overall financial cost of different types of card decline. Alternatively, customer segmentation can also tell you a lot about the groups affected the most by specific decline codes.
Customer Communication Strategies
It’s important to communicate with your customers about transaction declines in the clearest, most effective way. This can boost their overall experience and increase the likelihood of them trying again. Tailored messages are a good option here to inform customers about the specific reasons for decline and to guide them toward the best solution. Natural Language Processing (NLP) is useful here for generating customized decline messages, while you can utilize A/B testing to find out which messages are the most effective.
Emerging Trends in Credit Card Processing
With new technologies appearing all the time, credit card processing is evolving just as quickly. Of course, this creates opportunities as well as challenges. Staying up-to-date with trends can help you understand your payment processing picture more clearly so you can
Biometric Authentication Methods
One technology that is certainly making ways in the payment processing world is biometric authentication. This uses fingerprints or facial recognition to prevent authorized access and it offers much promise in reducing fraud and improving the overall customer experience.
To boost security even further, multimodal biometrics use more than one authentication type, while liveness detection helps to prevent spoofing.
AI-Powered Real-Time Transaction Analysis
AI is at the heart of most things currently, and for good reason. In this case, AI can ensure more accurate fraud detection and reduce the number of false declines. Whereas the human eye can only assess a small amount of data in a set amount of time, AI can analyze huge amounts within seconds and in real-time. This allows for much faster and more accurate decisions.
Learnings Recap
Throughout this guide, we’ve talked about the different credit card decline codes and how to overcome them. Some are more troubling than others, and a few don’t give a lot of useful information. However, it’s clear that the range of codes points toward a complex picture in the payment processing world.
A decline code can be due to anything from potential fraud to a small mistake when inputting the credit card number, with many other reasons in-between. By understanding the different groups and types of codes, you can address issues more comprehensively and ensure your business adapts. It’s good practice to spend time analyzing potential patterns and looking at the common codes you experience. These could point toward issues that require a simple tweak and, from there, you’ll have a smoother payment processing experience.
At PayCompass, we’re on board to help you every step of the way. We provide powerful tools and expertise to help you reduce decline rates and optimize your payment processes. From our advanced payment gateway to our flexible virtual terminal solutions, we’re committed to helping you navigate the complexities of credit card transactions with confidence. If you’re ready to get started, simply reach out to us today and one of our experienced experts will be in touch to kickstart your PayCompass journey.
