SAFE, an abbreviation of System to Avoid Fraud Effectively, refers to fraud records created by the issuer (card-issuing) bank for fraudulent transactions. Fraud records sent according to the Mastercard clearing format fall under the SAFE category.
The System to Avoid Fraud Effectively (SAFE) enables issuers (card-issuing banks) to report fraud data in a timely and appropriate manner.
It is important to note that when a bank sends SAFE or TC40 data, it is reporting the fraud. When a bank files a chargeback, it initiates a process to reverse the transaction in question.
All fraud-related chargebacks must be in the SAFE or TC40 report. However, not all SAFE and TC40 data has corresponding chargebacks.
Why?
The chargeback process can be time-consuming and expensive. If the costs of filing a chargeback exceed the amount of the disputed transaction, it is usually more cost-effective to skip the process entirely. In that case, the bank will reimburse the cardholder directly instead of recovering the money from the merchant.
