Billing

How to Handle Disputes

Disputes can be found in Stripe Dashboard > Payments > Fraud & Risk > Disputes for the customer in Stripe. Each one includes all relevant information about the payment being disputed and the reason the cardholder reported it to the card issuer. When you receive a dispute, you can respond to it and submit the appropriate evidence or accept it.

If you receive a dispute, contact the customer, and discuss it before you respond. It’s possible that they didn’t recognize or remember the transaction when they viewed their statement. If you have an email address (created to send an email receipt), click Email customer to create a new email that contains information about the dispute. Clicking Submit evidence begins the response process and provides additional information about the type of dispute and what steps you should take. If you have any information, you think the card issuer might want to see, submit it as dispute evidence. Make sure to finalize your evidence submission by clicking Submit evidence at the bottom of the dispute evidence form.

After you submit a response, the status of the dispute changes to under_review. If you win the dispute, this changes to win. If the card issuer upholds the cardholder’s dispute, the status changes to lost.

Submitting Evidence

The evidence you submit should be appropriate for the reason for the dispute. Web logs, email communications, shipment tracking numbers and delivery confirmation, proof of prior refunds or replacement shipments. For example, a response to a dispute with the reason “product not received” should have evidence that includes shipping information and any screenshots of package tracking. Stripe electronically submits this information to your cardholder’s issuer and notifies you of any updates to the dispute.

You can only submit dispute evidence once. Make sure to provide all relevant information and review it carefully before you submit it. Your progress is automatically saved, so you can return to the submission process later and review the evidence before submitting it.

• Keep evidence relevant and to the point - Provide only the facts surrounding the original purchase, using a neutral and professional tone. Your evidence should be factual, professional, and concise. While providing little evidence is a problem, overwhelming the card issuer with unnecessary information can have the same effect.

• Provide clear and accurate evidence - Include a clear screenshot of your terms or policies as they appear during checkout or on your site if they’re an important part of your defense (for example, a customer disputed a subscription, but you have a minimum contract term that they must adhere to).

• Include proof of customer authorization - Fraudulent disputes account for over half of all disputes. It’s important to prove the legitimate cardholder was aware of and authorized the transaction in such cases. Any data that shows proof of this is a standard part of a compelling response, such as:

  • AVS (Address Verification System) matches

  • CVC (Card Verification Code) confirmations Signed receipts or contracts

  • IP address that matches the cardholder’s verified billing address

Accepting Disputes

You can accept a dispute, effectively agreeing with the cardholder that the dispute was valid for the reason given. Accepting a dispute isn’t considered an admission of wrongdoing and is sometimes the most appropriate response. Disputes incur a 15 USD dispute fee (for users in the US)—this fee still applies if you accept the dispute.

Examples: Dispute category types

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 or is not recognized. 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: Contact your customer first.

Sometimes customers 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 isn’t sufficient evidence.

The credit card networks place liability for accepting fraudulent payments with you, the business. However, if you believe the dispute is invalid, you can attempt to prove this by submitting the appropriate evidence.

Subscription Cancelled

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

Required to overturn dispute: Prove that the subscription was still active, and that the customer was aware of, and did not follow, your cancellation procedure.

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.

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 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.

Credit not Processed

The customer claims that the purchased product was returned, or the transaction was otherwise canceled, but you haven’t yet provided a refund or credit.

Required to overturn dispute: Demonstrate that you’ve issued a refund to your customer through other means or that they aren’t entitled to one. You can’t issue one while a payment is being disputed. If you believe that they were entitled to a refund that you didn’t provide, you can accept the dispute.

How to respond: The first thing you should do is contact your customer. If you understand what their complaint is, you might be able to explain the misunderstanding or resolve it. If you’re able to resolve the issue with your customer, you can ask that they withdraw 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.

Source: https://docs.google.com/document/d/1G8NFZ6aWLR0b-N_Ir4WXjgxSPqCaSZEqFfucdSK161w/edit