Visa reason code 12.3: incorrect currency or DCC without consent
Visa code 12.3 covers incorrect currency or DCC without cardholder consent. Learn who files, how to respond, what evidence to gather, and the deadlines.
What Visa code 12.3 means and when it applies
Visa code 12.3, “Incorrect Currency,” is filed when the issuer claims that a purchase or cash withdrawal was processed in the wrong currency or that the cardholder could not freely choose the currency before a conversion. For the dispute to qualify under this code, at least one of these two grounds must exist:
- The transmitted currency was incorrect. The transaction currency differs from the currency sent through VisaNetVisaNet is Visa’s processing network. For this code, its record shows the currency in which the transaction was transmitted..
- The conversion occurred without a valid cardholder choice. Dynamic Currency Conversion (DCC)This is a conversion offered at the time of a purchase or cash withdrawal so the cardholder is charged in a currency other than the local currency. The cardholder must expressly choose to use it. occurred, and at least one of these failures followed: the cardholder did not expressly agree to the conversion, or could not choose the merchant’s local currency, the local currency of the country where the branch is located, the selected ATM currency, or the local currency of the country where the ATM is located.
Source for both grounds: Visa Core Rules §11.9.2.1, Table 11-58 (ID# 0030285).
Even when one of these grounds exists, code 12.3 is invalid if at least one of these three exclusions applies:
- Visa’s records classify the transaction as Straight Through Processing. The 12.3 table does not define this processing type; confirm the indicator with the acquirer.
- The transaction was a Mobile Push PaymentA payment method initiated by the cardholder on a phone or other mobile device to pay for goods or services or move money..
- The cash withdrawal meets every part of the ATM exclusion. The transaction was settled in USD, originated at an ATM outside the US Region, and used the Plus System. This exclusion does not apply when DCC occurred.
The issuer may dispute the entire transaction amount and has 120 calendar days from the Transaction Processing Date to file the case. After that deadline, code 12.3 is also invalid.
Source for the exclusions, amount, and deadline: Visa Core Rules §11.9.2.2–11.9.2.4, Tables 11-59 to 11-61 (IDs 0030286–0030288).
If the currency was correct and only the amount was wrong, see code 12.5. For a duplicate charge or a transaction paid another way, see code 12.6.
Deadlines for each party under Visa 12.3
1 block represents 10 calendar days.
- IssuerFile the 12.3 disputeThe clock starts when the transaction is processed by Visa.Up to 120 calendar days
- AcquirerRespond to the 12.3 disputeThe clock starts when the dispute is processed by Visa.Up to 30 calendar days
- IssuerTake the case to pre-arbitrationThe clock starts when the acquirer’s response is processed by Visa.Up to 30 calendar days
- AcquirerRespond to pre-arbitrationThe clock starts when the issuer’s pre-arbitration attempt is processed by Visa.Up to 30 calendar days
- IssuerAsk Visa to decide the caseThe clock starts when the acquirer’s pre-arbitration response is processed by Visa.Up to 10 calendar days
Who files the dispute and what happens next
The issuer, the cardholder’s bank, opens the 12.3 dispute. Depending on the ground, it must certify the correct currency code or certify that the cardholder did not agree to DCC, did not make an active choice, or was denied the local-currency option. Visa requires one of these certifications to open the dispute; it does not require a separate cardholder letter.
Source: Visa Core Rules §11.9.2.5, Table 11-62 (ID# 0030289).
The case is recorded in VROLVisa Resolve Online is the system where the issuer opens the dispute and the acquirer submits the case response and documents.. The acquirer, the institution that represents the merchant in the Visa network, reviews the records. If there is a valid basis to respond, it submits a Dispute ResponseThis is the acquirer’s formal response to the dispute. It states the basis of the defense and submits the documentation to Visa.. This is the name of the response in the Collaboration flow for Categories 12 and 13; there is no “second presentment” stage in this flow.
After the Dispute Response, the issuer may begin pre-arbitrationThe stage where the issuer challenges the acquirer’s response before asking Visa for a formal decision.. If the acquirer submitted evidence that meets the rule, the issuer must confirm that it contacted the cardholder, reviewed the evidence with the cardholder, and explain why the dispute continues. If the parties do not resolve the case, the issuer is the party that takes it to Visa arbitration.
Source for the flow and roles: Visa Core Rules §11.2.3, Table 11-2 (ID# 0030213), and §11.3.1 (ID# 0030214).
In a DCC case, the original dispute may cover the entire amount, but pre-arbitration is limited to the difference between the amount charged and the amount the cardholder should have paid. The same limit applies to arbitration at both the point of sale and an ATM. Seeking the full amount at that stage may result in an unfavorable ruling.
There is an important difference between the two channels. For ATM DCC responses processed on or after February 1, 2021, submitting all required evidence prevents the issuer from continuing to pre-arbitration. At the point of sale, a complete response does not automatically end the case; the issuer may continue if the cardholder maintains the dispute.
Source for the pre-arbitration limit: Visa Core Rules §11.9.2.8, Table 11-65 (ID# 0031083). Source for the arbitration limit and the difference between ATM and point-of-sale transactions: Visa, Updates and Clarifications to Dispute Rule Language, Dynamic Currency Conversion, p. 5 (Article ID AI10681).
Before building a defense, check whether this dispute is invalidProving any one condition is enough to challenge the dispute's validity.
- The transaction is classified as Straight Through Processing.
- The transaction is a Mobile Push Payment.
- The transaction was settled in USD and originated at a Plus System ATM outside the US Region — this exclusion does not apply to a DCC transaction.
- The dispute was filed more than 120 calendar days after the Transaction Processing Date.
Source:Visa Core Rules §11.9.2 — Tabela 11-60 (ID# 0030287) e Tabela 11-61 (ID# 0030288)
How to reduce the risk of this code
Prevention starts before the transaction is completed. Visa requires the merchant to state that DCC is optional, leave the conversion unselected by default, and let the cardholder expressly agree to it. For a card-present transaction, the information must appear on a customer-facing screen, and the cardholder must make the choice directly on that screen or payment terminal.
Source for the choice requirements: Visa Core Rules §5.8.9.1–5.8.9.2, Dynamic Currency Conversion.
Keep the electronic record of the cardholder’s choice with the Transaction ReceiptThe receipt for the purchase or cash withdrawal required by Visa’s rules. It identifies the transaction and records details including the amount and currency used.. The receipt must identify the transaction currency and amount. If DCC occurred, also retain the amount in local currency before the conversion and separate any DCC fees or commission. Keep confirmation that the merchant was registered to offer DCC as well.
Also confirm that the currency on the receipt matches the currency sent to Visa, and document every credit or reversal with its amount and date. These records allow the acquirer to show where the transaction was processed correctly or that the money was already returned.
Source for the records required in the response: Visa Core Rules §5.9.2.2, Table 5-33 (ID# 0027843), and §11.9.2.7, Table 11-64 (ID# 0030291). Source for merchant measures: Visa Dispute Management Guidelines for Visa Merchants, Condition 12.3, p. 31.
Evidence the merchant and acquirer need to gather
The merchant gives the documents to the acquirer, which selects the path that matches the facts and submits the Dispute Response in VROL. The paths are independent. Follow the stated logic for each:
- The correct currency was used, without DCC. Only one of these records is needed: the §5.9.2.2 Transaction Receipt or another authoritative record proving the correct currency. The second path helps only if the record actually shows the currency transmitted through VisaNet.
- The cardholder expressly agreed to DCC. To respond in the DCC currency and defend the full amount, all three items are required: evidence of the cardholder’s express agreement; acquirer certification that the Acceptance DeviceThe equipment or interface that accepts the payment, such as a payment terminal or ATM. For this defense, it must require and record the cardholder’s electronic choice. requires the cardholder’s electronic selection and does not allow the merchant, branch, or ATM to make it; and a copy of the §5.9.2.2 Transaction Receipt. If any one is missing, this complete defense is unavailable.
- DCC consent cannot be proven. To preserve only the pre-conversion amount, both items are required: acquirer certification that the merchant was registered to offer DCC and a receipt in the local currency showing the amount before conversion. The response excludes DCC fees and commission, so it concedes that difference instead of defending the entire charge.
- A credit or reversal was not addressed. Submit the credit or reversal record with both amount and date. It must link that credit or reversal to the disputed transaction.
- The dispute is invalid. Proving at least one of the three Table 11-60 exclusions is enough: Straight Through Processing, Mobile Push Payment, or a transaction settled in USD and originating at a Plus System ATM outside the US Region. The third exclusion cannot be used for a DCC transaction.
- The cardholder withdrew the dispute. Submit a letter or email from the cardholder that identifies the transaction and states that the cardholder no longer disputes it.
Source for the paths and documents: Visa Core Rules §11.9.2.6–11.9.2.7, Tables 11-63 and 11-64 (IDs 0030290 and 0030291), and Visa Dispute Management Guidelines for Visa Merchants, Condition 12.3, p. 31.
Visa also allows the acquirer to submit the DCC transaction as a first PresentmentThe acquirer’s initial submission of the transaction for processing. Resubmitting the transaction this way does not contest code 12.3 and may create a new late-presentment dispute. instead of sending a Dispute Response. This does not prove that code 12.3 was wrong. The acquirer may then become liable under code 11.3, “No Authorization/Late Presentment.” If the currency was in fact processed incorrectly and no response path applies, Visa’s guidance to the merchant is to accept the dispute.
Source for the first Presentment: Visa Core Rules §11.9.2.6, Table 11-63 (ID# 0030290). Source for the instruction to accept the dispute: Visa Dispute Management Guidelines for Visa Merchants, Condition 12.3, p. 31.
Frequently asked questions
When does a transaction qualify for Visa code 12.3?
The “Incorrect Currency” dispute condition has two possible grounds. For a currency mismatch, the transaction currency differs from the currency transmitted through VisaNet. For DCC without consent, Dynamic Currency Conversion (DCC) occurred without the cardholder’s express agreement, or the cardholder could not choose the merchant’s, branch’s, or ATM’s local currency.
Does offering DCC alone create a 12.3 chargeback?
No. Code 12.3 applies only when the cardholder did not expressly agree to DCC or was denied a local-currency choice. If the acquirer proves express consent, the dispute remains valid, but the evidence in the Dispute Response defeats it.
What proves a defense against a 12.3 DCC dispute?
The defense requires three items together. It needs evidence that the cardholder expressly agreed to DCC. The acquirer must also certify that the Acceptance Device requires the cardholder to select DCC electronically and does not allow the merchant, branch, or ATM to make that choice. It must also provide a copy of the Transaction Receipt required by §5.9.2.2. If any item is missing, this path fails.
What if the merchant cannot prove the cardholder’s DCC consent?
A partial-concession path remains. The acquirer submits the Dispute Response in the merchant’s, branch’s, or ATM’s local currency for the pre-DCC amount, excluding DCC fees and commission. It must certify that the merchant is registered to offer DCC and provide a §5.9.2.2 receipt in the local currency.
How long does the issuer have to file a 12.3 dispute?
120 calendar days from the Transaction Processing Date.
Can the issuer seek the full amount in pre-arbitration for a 12.3 DCC dispute?
No. For DCC, pre-arbitration and arbitration are limited to the difference between the amount charged and the amount the cardholder should have paid. The limit is not the full transaction amount. Seeking the full amount may result in an unfavorable ruling.
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