Call (844) NO-DISPUTESWhat is a Credit Card BIN (Bank Identification Number)?
A Bank Identification Number (BIN) is the first 4-8 digits of any payment card number that tells you which bank issued the card. It’s a valuable tool that merchants can use to identify fraud patterns and stop chargebacks before they happen. The problem is that most merchants don’t pay enough attention to these numbers when they should.
When you use BINs properly, they help you track problem transactions back to the exact banks they came from. This lets you use targeted fraud prevention instead of creating blanket restrictions that might end up hurting your real customers. If you keep track of BIN patterns, you’ll be able to see new fraud activity early and set up blocking restrictions that significantly cut down your chargeback ratios.
Here’s a real example that shows how well this works. One merchant was able to lower their chargeback rate from 76% to under 1% just by blocking one single problem BIN that had been causing fraudulent transactions.
Chargebacks end up costing merchants serious money through fees and lost sales. Every time a transaction gets disputed, it starts a series of operational costs that just keep piling up. And here’s the worst part. If too many chargebacks come through, your payment processor will start hitting you with higher fees or they might even close your account completely.
How It Works
When a customer swipes their card, the BIN gives you all the basic info you need right away. Those first six to eight numbers show you which bank issued the card and what type of card it is.
For example:
- Visa card always start with 4.
- MasterCards start with 51-55, or 2221-2720.
- AMEX starts with 34 or 37.
You can start to see patterns here; if someone reads a card off to you and says “4153…” you immediately know its a Visa.
The system also shows the country where the card came from and tells you if it’s a credit or debit card.
The payment processor takes this info and uses it to make quick decisions about whether to approve the sale. If the BIN shows a card from a country where fraud is common, the system might hold it for manual review. Some processors will even block specific BINs automatically if they’ve had a lot of problems with those cards recently.
When the system blocks a bad transaction, it prevents chargebacks that can cost hundreds of dollars each.
The payment network also needs to know where to send the transaction. Once the BIN shows which bank issued the card, your processor sends the payment request to the right bank. All this happens in the background while your customer waits those few seconds to see if their card goes through.
Most payment systems now use eight-digit BINs instead of the old six-digit ones. Banks had to make this change because they were running out of number combinations. The extra two digits give banks millions more BIN codes to assign.
You can usually find BIN information in your payment processor’s dashboard or reports. Most systems show you the card type and bank name right on your transaction screen. Some business owners use this to adjust their checkout process or suggest different payment options based on what kind of card the customer has.
How It Affects Chargeback Prevention
When merchants examine BIN patterns in their data, they can identify problems before they start costing them money. If merchants see that most of their chargebacks come from cards issued by certain banks, the data reveals patterns quickly.
This method succeeds because fraudsters usually target the same issuing banks or use similar card types repeatedly. Once these patterns emerge, there are several options. Merchants can block transactions from problem BINs when risk is high or add extra verification steps for those particular cards.
What makes BIN tracking especially helpful is how it works as an early warning system. Most merchants wait until chargebacks start rolling in before they take action. But BIN analysis reveals the pattern while it’s still forming – fraud usually follows predictable paths. A merchant might see that prepaid cards from one area started causing disputes last Tuesday. That gives them time to adjust the guidelines before the problem gets worse.
Your chargeback ratio drops while legitimate customers keep shopping without any extra friction. Each fraudulent transaction blocked protects processing rates and prevents account restrictions that could shut down the business.
The whole security management method is simple. When you block high-risk BINs, you’re not blocking everyone – just the problem areas. A restaurant chain might block gift cards from specific banks that have high chargeback rates but still accept standard credit cards from those same banks.
Some payment processors report that merchants who use BIN-based strategies cut their chargeback ratios by 40% or more. These improvements mean more revenue stays in the business and that you pay lower processing fees.
Example Scenarios
Blocking those problem BINs for a while helps while looking into what’s going on. Maybe those banks don’t have great fraud controls, or maybe fraudsters just like to use stolen cards from those places. Either way, you stop losing money pretty quickly. Most of these blocks will start working within a few minutes after setting them up.
Here’s another situation that might come up. Let’s say there’s a flash sale and fraudsters hit the site with tons of stolen card numbers. But then something interesting shows up in the data. Most of the fake transactions come from premium cards issued by banks in completely different countries than the billing info people are giving. This pattern starts to show within just a few hours of the sale going live.
When the BIN’s home country doesn’t match up with the customer’s billing address, that acts as an early warning system. Having someone review these transactions before they go through makes sense. These geographic mismatches help catch about 60% of fake transactions before they happen. The review team can spend their time on these flagged orders instead of having to check every single transaction. Every chargeback that gets stopped saves the original sale amount plus the extra penalty fees that banks charge.
This pattern with promotional campaigns happens more than you’d expect. Fraudsters love sales because they can test lots of stolen cards very fast. The key is watching the data closely after making any big change to the business. New markets, new products, or new marketing campaigns bring in legitimate customers and fraudsters alike.
Requirements and Timeframes
The payment industry started switching to 8-digit BINs back in April 2022. Basically, payment systems now need to work with longer bank identification numbers than before. Most merchants had to update all their payment processing software and fraud detection tools to handle this change. The timing actually caught many merchants off guard.
Make sure to update BIN databases regularly to keep up with new card issuers and all the changes happening in the market. If the information gets old, merchants might end up turning away legitimate customers or letting fraud slip through. BIN data should be checked at least every three months, though monthly updates are more effective for those processing lots of transactions.
When BIN data gets old, it starts causing problems everywhere in the payment system. Fraud filters might start blocking legitimate customers while the real threats get through. High-volume merchants feel this even more because they’re dealing with so many different card types every day.
If a business chooses to block specific BINs to stop fraud, they can’t just set it up and walk away. The card networks actually need merchants to go back and review these blocks regularly. Be careful not to turn away real customers by mistake. Make sure to write down why each BIN was blocked and the last time it was checked.
Some networks have requirements on how long these blocks can stay in place without checking them again. Visa and Mastercard expect merchants to explain their blocking decisions if asked. Penalties could hit if the blocks look discriminatory or the right records aren’t available.
Frequently Asked Questions
How many digits are in a BIN?
Most merchants don't know that BINs aren't always six digits anymore - even though they were for years. Payment teams haven't actually caught on to this change yet. But the payment world has already moved on from this old standard. Visa made the switch to eight-digit BINs back in April 2022, and the other card networks are following close behind.
The payment industry grew so fast that we actually ran out of six-digit combinations. With new banks, credit unions, and fintech businesses all launching payment cards every year - and each one needing its own code - six digits just wasn't enough space anymore. So they made it eight digits instead.
This change has created some problems for merchants though. Your payment processor might not process these eight-digit BINs yet and could make transactions fail or get processed wrong. The best move is to contact your processor and ask them directly if they support eight-digit BINs.
When transactions fail, you lose more money than you might think. Each time a payment doesn't go through, that's revenue you're missing out on - and your competitors might get that sale instead. Customers lose trust in your business when their payments don't work. They don't understand why.
What makes this weird is that everyone still calls them "BINs" - it doesn't matter if they're six digits or eight digits long. The name stayed the same even though the format changed. But at least they still do the same job - the BIN tells you who issued the card and helps move the transaction along.
All the card networks will use these longer BINs over the next few years. Your payment systems need to work with the old and new formats during this transition period.
Can I block transactions from specific BINs?
Most payment processors let merchants block transactions at the BIN level - this feature is usually in the fraud settings or filter options in the payment gateway dashboard. All the big processors have this feature built in. Stripe, PayPal, and Square all let users block BINs right from their dashboards. The whole process is actually pretty simple.
There's usually a section that says something like "blocked BINs" or "restricted card ranges" where you can add those six-digit codes. Some gateways might call this a "blocklist" or "blacklist." The names are different but they all work the same way.
When you block an entire BIN, you're saying no to every single person who has a card from that bank or card program. This might mean turning away legitimate customers - and each blocked BIN can affect thousands of shoppers. Revenue goes down and fraudsters just move on to different card programs anyway.
Each BIN represents thousands of cardholders. When blocking the whole range, honest customers get turned away just because a few bad ones use the same bank. Before blocking everything, it makes sense to try some other steps first.
You could mark those BINs for manual review so you're not automatically turning them down. This way fraudsters still get caught and regular customers with cards from that same bank can still buy from you.
Manual transaction reviews take more work. But remember - these are your customers too. That's why it's worth checking blocked BINs every few months. Card programs change and some banks may have cleaned up their fraud problems.
What's the difference between 6-digit and 8-digit BINs?
6-digit and 8-digit BINs work the same way. They let merchants see which bank or company issued the card. The main difference is in how much detail you get.
A 6-digit BIN is like learning a customer lives somewhere in Chicago. An 8-digit BIN tells you their exact neighborhood too. Those extra two digits matter more than you'd expect. They help card businesses tell which type of card a customer has.
We're stuck in this weird situation where these two lengths are floating around at the same time. Some cards still use the old 6-digit setup and newer ones have already switched to 8 digits. Merchants struggle because their fraud detection systems need to work with each type.
The business side is simple. More information means better fraud protection. Fraud detection gets better when systems know what type of card they're dealing with. Your premium rewards card triggers different security checks than a basic debit card. Scammers might target premium cards or student cards for different reasons.
When you can tell what card a customer has, you can stop fake transactions much faster. Criminals usually test stolen numbers on small purchases first. Better BIN information helps catch these test runs before they can do any damage.
But here's where it gets tough. These improvements only help if the systems actually use the new information. Payment processors still run on older software. If fraud tools treat 8-digit BINs the same as 6-digit ones, you don't get any benefit from the extra detail. The extra digits might show if it's a rewards card or a basic checking account card.
How can I use BIN data to Cut Back on chargebacks?
Merchants should go through all their previous chargeback data and look for any patterns that jump out. Always check which BINs are showing up in disputes. Some card types will just give more problems than others. The data will make this pretty obvious. If merchants don't do this part, they'll miss warnings that would have been straightforward to catch.
Once you find the problem BINs, you can start creating systems for dealing with them. Maybe it makes sense to block some prepaid card BINs that always seem to cause problems. Or you might add extra verification steps when a custoer uses an international BIN from a country where the business doesn't normally get customers.
You can also use BIN data to catch these location mismatches. Say a customer's billing address shows they live in Ohio but their card comes from a bank in Romania. That deserves a second look. These mismatches almost never happen by accident - they usually mean a customer is working with stolen card information. Thieves who steal card data don't usually bother to match the billing info to where the card actually came from. Your fraud system should flag these mismatches.
But here's the thing. You don't want to block legitimate customers just because their card shares a BIN with cards that fraudsters use. If you block these customers, you'll lose sales and each false positive costs actual revenue.
It's worth checking what chargeback rates other merchants see for different BIN types - this data helps choose where to set your limits. Every business works differently. How much fraud exposure a business wants to take will shape these decisions.
Leave a Reply