What is a dispute/chargeback?
Disputes (also known as chargebacks) are transactions that have been disputed by the purchaser. They are a form of customer protection provided by the banks that issue credit cards, and allow cardholders to file a complaint when they believe there are fraudulent transactions on their statement. Once the cardholder files a dispute, the issuing bank makes an investigation into the complaint. Cardholders may dispute a transaction when they don't recognize the charge on their statement, the purchase received by the cardholder may not match what was advertised, or the services/items that were purchased were not received by the cardholder, etc.
If a purchaser files a dispute, you will be notified by email. Pay particular attention to the dispute type. You can then make your decision whether which of these options to take:
- Concede - this will allow the customer to receive a full refund
- Challenge - this means you don't think the customer should receive a refund and you will provide supporting evidence
Your dispute notification email will refer you to your Stripe account to view details of the dispute. After logging into Stripe, go to Payments, then choose the Disputes tab to take the next steps. When you receive a dispute notification, take action to resolve it before the deadline (usually 7 to 21 days depending on the card network). If you don’t respond before the deadline, you automatically lose the dispute and can’t retrieve the disputed funds. You can see a detailed list of all your disputes in the Disputes tab.
Stripe dispute process
Stripe is ActivityHero’s payment processor, so disputes are handled through their process. Below is an overview of Stripe’s dispute process. For more details, you can view Stripe’s full article on disputes.
Review the dispute category
When you get a dispute, you can see the corresponding category or reason in your Dashboard and see the same information as the reason attribute for the Dispute object.
Each dispute category specifies different response requirements and recommendations to appropriately respond to the root claim of the cardholder. Your first step is to review our response guidelines for the dispute category. This helps you collect the best evidence to counter the dispute claim.
To review a dispute, open its details page by selecting the applicable dispute in the list. If you use Organizations, the detailed list of disputed payments includes all your accounts. You can filter this list by account. In this view, you can also respond to disputes across any account.
Understand the complaint
When possible, the Dispute details page provides you with a copy of the bank’s submission to Stripe based on the account owner’s claim. These are actual documents attached by card networks and can provide additional information about the disputed transaction, such as a text description from the account owner describing the specific complaint. When responding to the dispute, make sure to properly address the issue described in these files.
If the dispute is still open and the bank has provided these files, select Review the claim details under step 1 of the checklist modal in the Dashboard to view them.
The Dispute details page might also provide you with a way to email the account owner. We recommend contacting them, as it might give you insight to better understand the complaint and help you decide how to proceed. Be sure to keep a record of all communication with your customer during this process, as it provides evidence to submit with your response.
Accept or challenge the dispute
When you have a clear picture of the dispute details, decide whether to accept or challenge the dispute. Consider the following in your determination:
- Make sure the account owner’s claim is valid. If it’s not, gather the evidence required to disprove the claim.
- See if you can convince the account owner to withdraw their dispute if you resolve their complaint amicably. For example, you could offer a credit or an alternative session.
When you’ve decided how to respond, select the corresponding button on the Dispute details page in the Dashboard:
- Accept dispute: Submits a response to the issuing bank affirming that you aren’t contesting the refunded amount.
- Counter dispute: Opens a form that guides you through the submission process, prompts you for evidence relevant to both the dispute and response type, and allows you to upload supporting files.
If you counter a dispute, a $15 dispute countered fee applies, in addition to the dispute received fee. The cardholder’s bank reviews it and decides the dispute outcome. This can take up to 3 months. When Stripe receives the decision, you receive an email from us.
Stripe returns the dispute countered fee if you win the dispute. Unless otherwise stated in your Stripe contract, we never return the dispute received fee.
Handle disputes through Stripe
Always address a formally disputed payment through this process. The issuing bank has already refunded the account owner, and it’s the only way you can attempt to retrieve the disputed funds.
Submit evidence through the dashboard
You have only one opportunity to submit your response. Stripe immediately forwards your response and all supporting files to the issuing bank. You can’t edit the response or submit additional files, so make sure you’ve assembled all your evidence before you submit.
1. Open the dispute response form: Click Counter dispute to open the Stripe dispute response form.
2. Tell us about the dispute: In the first page of the form, tell us why you believe the dispute is in error and the product type of the original purchase. This information, along with the dispute category, helps Stripe recommend the most relevant evidence to support your challenge on the next page of the form. For example, you don’t need to provide shipping details for an online service. When your integration supports it, Stripe automatically captures the product type based on the original payment.
3. Assemble your evidence: The second page of the form has a dynamic set of sections representing the most relevant details you can provide for your individual case.
In the Supporting Files section, use the File Upload tool to attach evidence that matches the checklist of evidence types relevant to your dispute type and counter argument. For each uploaded file, specify which type of evidence it satisfies. You can only submit one file per type of evidence, so if you have several files representing one type of evidence, combine them into a single, multi-page file.
Consider the following guidelines to make sure your supporting files are effective:
- Consult the evidence recommendations for your specific dispute category.
- For fraudulent disputes in particular, if your dispute is Visa CE 3.0 eligible, look for the Required for CE 3.0 badge throughout the response form. In most cases, Stripe pre-populates these fields with the required data from your transaction history.
- If the field is pre-populated, don’t edit it because you might affect eligibility.
- If the field is empty, add the requested information, such as the product description.
- Organize each piece of evidence according to the evidence type it satisfies—be as succinct as possible.
- Combine items of the same evidence type into a single file.
- Limit your evidence file size to the combined maximum of 4.5 MB.
- Limit your Mastercard evidence file length to the combined maximum of 19 pages.
- Banks evaluating the dispute won’t review any external content, so don’t include:
- Audio or video files
- Requests to call or email for more information
- Links to click for further information (for example, file downloads or links to tracking information)
- Shipping details
- Refund policy details
- Customer details
- Product details
The more information your integration collects and passes to Stripe when your customer makes a payment, the better your ability to prevent disputes and fraud from occurring, and challenge them effectively when they do.
5. Submit evidence: Click the checkbox to acknowledge your understanding that your response is final. After you submit it, Stripe automatically puts the evidence you provide into a format accepted by the issuing bank and submits it for consideration. At this point, you can’t amend what you’ve submitted or provide any additional information, so make sure to include every relevant detail.In some cases, you might have multiple disputes associated with a single payment. If this occurs, consider responding to each dispute individually.
Check the dispute status
After you submit a response, the status of the dispute changes to under review. When the issuer informs Stripe of its decision, we inform you of the outcome by email, in the charge.dispute.closed event, and by updating the dispute status in the Dashboard and the Dispute API object to one of the following:
- won: Indicates that the bank decided in your favor and overturned the dispute. In this case, the issuing bank returns the debited chargeback amount to Stripe, and Stripe passes this amount back to you.
- lost: Indicates that the bank decided in the account owner’s favor and upheld the dispute. In this case, the refund is permanent and the dispute fee isn’t returned.
In some cases, the bank provides additional details about the dispute decision. Select View issuing bank response under Relevant documents in the dispute details to view them. For more details, you can view Stripe’s full article on disputes.