What are Soft Decline Response Codes?

Soft decline codes are transactions that get declined because of a temporary issue, or transactions that may need clarification on customer information. These types of declines can be particularly embarrassing for the cardholder, as they can include grace periods on expired cards, insufficient funds, exceeded limits, and more. 

But for eCommerce and subscription businesses, soft declines can mean missed revenue. Knowing your soft decline codes can help inform which declined payments to retry. 

Soft decline codes are temporary and resolvable issues with the cardholder. Because of this, soft declines can be tried again. 

Common soft decline codes can include:

• Refer to Issuer – this code indicates that the Issuer needs further verification from the cardholder. With digital stores for example, this might be applying the wrong code with 3-D secure or including a wrong address to confirm identity
• Refer to Issuer (special condition) – similar to ‘refer to Issuer,’ only sometimes Issuers have special requirements for verifying a cardholder. This code might elaborate on the internal rules that aren’t met
• Do not honor – this code can show suspected fraud in the form of unusual spending and
  high-risk cardholder locations. But it can also be a simple mismatch between shipping and billing addresses, or an incorrect CVV entry
• Expired card (grace period) – after a card expires, some banks can offer a grace that transactions are processed in
• Insufficient funds – this code means that the cardholder’s account is lower than the transaction amount. This might mean paying off the card, or using a different card altogether
• Activity limit exceeded – this code means that the card holder has exceeded their daily or
  per-transaction spending limit set by the bank

Pouring through a Merchant’s history takes time and resources for everyone involved. But it’s a crucial step for any Merchant trying to lay the groundwork for success in Payments.

April 22, 2024