This article is also available in:
Chargebacks are the fees returned to payment cards after customers have successfully disputed an item on their statements of account or transaction reports. Chargebacks could be either applied to debit cards (and basic bank accounts) or credit cards. Customers could ask for chargebacks in several circumstances. This part will guide you on how to respond and process chargeback requirements from customers.

In this article

A. Credit not processed
B. Duplicate
C. Fraudulent
D. General
E. Product not received
F. Product unacceptable
G. Subscription canceled
H. Unrecognized

When one payment account is listed as dispute and required to be refunded by cardholders, their card issuers will use one of these sections to correctly describe the reasons for that payment. You can see it according to the orders by clicking into ShopBase Managing > Orders.

A. Credit not processed

The customer claims that the purchased product was returned or the transaction was canceled, but you have not yet provided a refund or credit.

Required to overturn dispute:
Demonstrate that you have refunded your customer through other means or that your customer is not entitled to a refund.
You cannot issue a refund while a payment is being disputed. If you believe that your customer was entitled a refund that you did not provide, you can accept the dispute.

How to respond:
You should first get in touch with your customer. If you understand what their complaint is, there is a chance for you to explain the misunderstanding or to make it right.
If you’re able to resolve the issue with your customer, you can ask that they withdraw the dispute.

If the cardholder agrees to withdraw the dispute, you should still submit evidence for the dispute. In addition to the following evidence, your submission should include correspondence with the cardholder saying they would withdraw the dispute and a written statement from their card issuer confirming that the dispute has been withdrawn.

B. Duplicate

The customer claims they were charged multiple times for the same product or service.

Required to overturn dispute: Demonstrate that each payment was for a separate product or service.

How to respond: Determine if your customer was incorrectly charged multiple times.
If they were not, collect any and all information documenting that each payment was made separately, such as copies of receipts. If the receipts don’t include the items purchased, be sure to include an itemized list. Each receipt should clearly indicate that the payments are for separate purchases of items or services. If you’ve been able to get in touch with the customer you should be sure to address any concerns they had in your evidence.

If they were duplicate payments, you should accept the dispute. You cannot issue a refund while a payment is being disputed. If there have been two or more separate payments, you should get in touch with your customer. If you understand what their complaint is, there is a chance for you to explain the misunderstanding or to make it right. If you’re able to resolve the issue with your customer, you can ask that they withdraw the dispute.

C. Fraudulent

This is the most common reason for a dispute and happens when a cardholder claims that they didn’t authorize the payment. This can happen if the card was lost or stolen and used to make a fraudulent purchase. It can also happen if the cardholder doesn’t recognize the payment as it appears on the billing statement from their card issuer.

Required to overturn dispute: Provide adequate payment and order details so that a legitimate customer recognizes it, or proves to the card issuer that their cardholder authorized the transaction.

How to respond:
First, try to get in touch with your customer. Sometimes people forget about payments they make or don’t recognize the way they appear on their card statement. If this is the case, ask them to contact their card issuer and let them know they no longer dispute the transaction. Even if your customer agrees to withdraw the dispute, you must still submit appropriate evidence. Simply saying that your customer is going to withdraw the dispute is not sufficient evidence.

It may be more efficient—and provide a better customer experience—to accept an accidental dispute and charge the customer again, if appropriate. Even when a dispute is withdrawn, it usually takes approximately 75 days to be finalized. Remember, it doesn’t matter to the card networks whether you win or lose a dispute; what matters is how many disputes a business receives, regardless of how many disputes are won.

If you believe the payment was actually made using a stolen credit card, you will need to accept the dispute. The credit card networks place liability for accepting fraudulent payments with you, the business. However, if you believe the dispute is not valid, you can attempt to prove this by submitting the appropriate evidence.

D. General

This is an uncategorized dispute, so you should contact the customer for additional details to find out why the payment was disputed.

E. Product not received

The customer claims they did not receive the products or services purchased.

Required to overturn dispute: Prove that the customer received a physical product or offline service, or made use of a digital product or online service. This must have occurred prior to the date the dispute was initiated.

How to respond: First, get in touch with your customer. Understanding why they filed the dispute will be important for helping make sure your customer gets the product and will give you critical information to prevent this from happening to others.

F. Product unacceptable

The product or service was received but was defective, damaged, or not as described.

Required to overturn dispute: Demonstrate that the product or service was delivered as described at the time of purchase.

How to respond:
If the product or service is as described, provide specific information (invoice, contract, etc.) to refute the cardholder’s claims. Quality disputes are where the customer does not agree with the condition of merchandise or service received (e.g., a car repair situation or quality of a hotel room). There may be instances where you will need to obtain a neutral third-party opinion to help corroborate your claim against the cardholder. Provide as much specific information and documentation as possible to refute the cardholder’s claims. It is recommended that you address each point that the cardholder has made.

If the customer has not yet returned the product or canceled the service, provide specific information to that effect. You should double-check your incoming shipping records to verify that you have not received a return before you respond. If you have processed a credit or reversal for this transaction, provide evidence of this which includes the amount and date processed.

For products that have been repaired or replaced, provide evidence that the cardholder agreed to a repair or replacement, it has been received by the customer, and the repair or replacement has not since been disputed.

If the customer no longer disputes the transaction, provide a letter or email from the cardholder stating that they are no longer in dispute.

G. Subscription canceled

The customer claims that you continued to charge them after a subscription was canceled.

Required to overturn dispute: Prove that your service does not provide any subscription, and that the customer was aware of that.

How to respond: First, get in touch with your customer. If you understand what they believe happened, there is a chance for you to explain the misunderstanding or to make it right.

H. Unrecognized

The customer doesn’t recognize the payment appearing on their card statement.

Required to overturn dispute: As with fraudulent disputes, get your customer to withdraw the dispute by helping them identify the payment.

How to respond: First, try to get in touch with your customer. Sometimes people forget about payments they make or don’t recognize the way they appear on their card statement. If this is the case, ask them to contact their card issuer and let them know they no longer dispute the transaction.

Even if your customer agrees to withdraw the dispute, you must still submit appropriate evidence. Simply saying that your customer is going to withdraw the dispute is not sufficient evidence.

It may be more efficient—and provide a better customer experience—to accept an accidental dispute and charge the customer again, if appropriate. Even when a dispute is withdrawn, it usually takes approximately 75 days to be finalized. Remember, it doesn’t matter to the card networks whether you win or lose a dispute; what matters is how many disputes a business receives, regardless of how many disputes are won.
Was this article helpful?
Cancel
Thank you!