A dispute occurs when a cardholder (guest) raises a complaint with their bank or credit card company about a payment made to you.
In general, when the bank receives the complaint, the bank creates a formal dispute, reverses the payment, notifies you, and charges a fee of $15.00 for the dispute.
This article lists down the stages of a dispute and the reasons for a dispute.
Stages of a Dispute
The stages of a dispute depend on the type of dispute raised by a guest.
- Request for Information: After a guest raises a dispute with the bank or the card issuing authority, you will be asked for more information. You must provide this information within a stipulated time period. At this stage, you are not liable to pay any fees or charges. However, if you do not respond in a timely manner within the stipulated time, you may be liable for a chargeback, and money may be withdrawn from your account.
Note: Requesting for information is as per the bank’s discretion. Some banks may directly create a chargeback instead of requesting for information.
Suggested Action: Provide as much information as possible.
- Chargeback: A chargeback is the removal of the disputed funds from your account. For example, if Jennifer purchases a product worth $100.00 and if she later disputes the transaction, the $100.00 credited to your account will be withdrawn either by the bank or by the card issuing authority. After a dispute is raised by a guest, banks may notify you of a chargeback or directly levy a chargeback.
- Information Supplied: The company receives the evidence yo submit and thoroughly cross-checks the details.
- Chargeback Reversed: In case the bank or the issuing authority accepts your evidence, you will receive a full refund of the chargeback.
Reasons for Disputes
The reasons for disputes can be classified as follows:
- Fraudulent online transaction: This scenario occurs when a guest denies booking an appointment online or purchasing a product online. This may happen due to online identity theft.
- Fraudulent in-store transaction: This scenario occurs when a guest claims that her card was stolen and the in-store transaction was not authorized by her.
- Duplicate Charge/Double Charge: This scenario occurs when the guest claims she was charged twice for a single transaction.
- Services not received/Merchandise not given: This scenario occurs when a guest claims that she was billed for services she did not take or billed for products she did not purchase.
- Canceled transaction: This scenario occurs when the guest’s bank states that the transaction was canceled as the guest returned the products or canceled the services. This is also true for recurring payments - when the recurring payment is processed after the guest cancels the transaction.
- Defective products: This scenario occurs when the guests receive a defective product or dispute the quality of the products.
- Counterfeit merchandise: This scenario occurs when products are identified as counterfeit by the guests.
- Misrepresentation: This scenario occurs when the terms and conditions of the sale were misrepresented.
- General: This scenario occurs for any other situation apart from the above scenarios.
- Request for Information: This scenario occurs when a guest suspects that she was charged falsely and requests for further information.
If you have received a dispute notification, this is what you need to do:
- Check the dispute reasons and submit the appropriate evidence
- View the timelines for defending a chargeback.
- Review the disputed transaction using the Zenoti Payments Disputes report.
- Respond to the dispute by either accepting the dispute or by submitting evidence to prove that the payment was valid.