There are several terms associated with a debit card transaction that most of us aren’t familiar with. One of these terms, a payment reversal, is very common as far as debit and credit card purchases are concerned. For instance, if you ordered a product and changed your mind due to one reason or the order, you would likely want to return the product and get your money back, right? Now, to get your money back, there will have to be a reversal. But what is this term payment reversal? What does it mean?
Payment reversed means that the funds used to make a transaction has been returned to your bank. This process can be initiated by you, the cardholder, the merchant, the issuing bank, the acquiring bank, or the card association.
Not all transactions will go as planned. Most merchants know this, and it would be best if you kept this at the back of your mind as well. So, when a certain transaction goes south, what do you do? Would you sit down, fold your arms and do nothing? Or do you act? Some of us may not know what to do when we find ourselves in such a situation. You see, if a transaction doesn’t go the way you expected it to do, you can request your money back. And one of the ideal ways to carry that out is by initiating a reversal. In this article, you will find out more.
Which Card Details To Give For Payment Over the Phone?
What Does Payment Reversed Mean?
Katie couldn’t visit her favorite mall, as usual, so she decided to order a crossbody bag which was supposed to be a birthday gift from her childhood friend. The product was to be delivered the following day. However, that very day, Katie changed her mind. She realized that her friend has the type of crossbody bag she ordered. So, Katie decided to contact the merchant and request her money back. In other words, Katie is demanding a reversal.
I believe there are many of us currently in Katie’s shoes, or a lot of us would someday end up in Katie’s shoes. If you find yourself in her situation, what do you do? Do you just let it slide? Call your bank? Or lose hope. If you aren’t like Katie, you may embrace the options mentioned. But if you are like Katie, you would indeed request your money back. And trust me, you can as your reason is quite good.
Before we stray too far, you must understand the purpose of this article. This article aims to help you know what the term “Payment reversed” mean. You could see the term on your online statement and not know what it means. Or you could have a shallow knowledge of what a payment reversal generally means. So, before I help you understand what a this term mean, let us take a look at what a payment reversal means.
What is a Payment Reversal?
A payment reversal is a widespread occurrence. It is a situation whereby funds from a transaction are reverted to the cardholder’s bank account.
A payment reversal can be performed by several different methods and can be initiated by a cardholder, merchant, acquiring or issuing bank, or the card network. This process can occur in a few ways; customer disputes, authorization reversal, and refund. Each of these reversals occurs at diverse stages of the transaction process and for myriad reasons.
Having understood what a payment reversal is, let us look at a few reasons why a merchant would be willing to return the funds of a transaction to your bank account.
Below are some examples that could result in a transaction being overturned:
- If the merchant asked for the wrong dollar amount when tendering a transaction
- The product was mistakenly processed excessively
- The description of the product was misleading or wrong
- The item bought is back-ordered or out of stock
- You changed your mind after ordering an item
- You are trying to get something for free
There exist three primary methods by which a translation can be reverted. These methods are authorization reversal, a refund, or a chargeback. The truth is, none of these techniques are ideal. However, some are complicated than others. For instance, a refund and a chargeback are far worse than an authorization reversal. An authorization reversal is very easy to initiate, and it is pretty fast since the transaction hasn’t been posted yet, unlike a refund or chargeback.
Merchants are often scared of a chargeback as many of it could lead to severe consequences for them. So, you expect them to resist initiating a chargeback whenever a customer tables a dispute.
Put simply, if you see the terms “payment reversed” on your online statement or anywhere, it simply means the funds associated with a transaction have been returned to your account. This usually happens after you tender a dispute and it has been successfully sorted.
It is important you note that, before a reversal can be initiated, you must ensure that you have a reasonable reason as to why you need your funds back. Don’t forget to check out the merchant’s refund and return policy for more insights.
What Does Payment Deferred Mean On Credit Report?
How Long Does It Take For a Payment To Be Reversed?
If you ordered a product that was delivered in bad shape, you would want to return the product and get your money back, right? Of course. So, you call the merchant and request your money back because the product delivered is faulty. In other words, you are trying to initiate a reversal. Now, if you successfully initiated the process, how long would it take for the funds to hit your account?
It takes 24-48 hours under normal circumstances for a payment to be reversed. However, in some situations, you could wait for 3-4 working days.
If you initiate a reversal and haven’t still gotten the returned funds after four days, don’t hesitate to contact the merchant or the bank if the merchant fails to cooperate.
