A dispute occurs when a buyer claims a transaction was unauthorized, incorrect, or that goods/services were not delivered, and a chargeback is the formal outcome of that dispute in which the bank forcibly reverses the payment from the merchant’s account. This article outlines how PaySmart merchants will manage disputes and track charge backs in the PaySmart merchant portal (pay.withpaysmart.com).
- What is a Dispute?
- What is a Chargeback?
- Dispute Notifications
- Managing Disputes in the PaySmart Portal
- Related Fees
- Best Practices for Avoiding Future Disputes
What is a Dispute?
A dispute arises when a customer believes that a transaction should not have occurred or that the product or service received did not meet their expectations. Common reasons for disputes include:
- Unauthorized Transactions: The customer did not authorize the charge.
- Product Not Received: The customer paid for an item never delivered.
- Defective or Not as Described: The product received was damaged or did not match the description provided at the time of purchase.
- Billing Errors: The customer was charged the wrong amount or multiple times for the same transaction.
When a dispute is raised, the merchant may have the opportunity to resolve the issue directly with the customer before it escalates to a chargeback.
What is a Chargeback?
A chargeback is a consumer protection mechanism that allows customers to reverse a transaction through their bank or credit card issuer. This process is typically initiated when a dispute cannot be resolved directly with the merchant. The chargeback process involves several steps:
- Initiation: The customer contacts their bank or credit card issuer to report the dispute and request a chargeback.
- Investigation: The bank reviews the claim, which may involve gathering evidence from both the customer and the merchant.
- Decision: The bank determines whether to approve or deny the chargeback request.
- Reversal: If approved, the transaction amount is refunded to the customer, and the merchant's account is debited.
Common chargeback reasons include:
- Fraudulent transaction
- Duplicated charges
- Not as described/defective merchandise
- Services not provided or merchandise not received
- Refund not processed after the returned item
Dispute Notifications
Ollie Order merchants leveraging PaySmart will be notified when a dispute matter is opened:
- If a dispute is raised, PaySmart users will receive a notification from help@withpaysmart.com that will be sent to their email address associated with their PaySmart portal login.
- Disputes are available and can be managed directly by merchants in the PaySmart portal (pay.withpaysmart.com).
- PaySmart merchants will be notified via email when a new dispute or chargeback is filed against their business, with instructions on what to do next.
Note: For assistance understanding or troubleshooting a dispute, reach out to support@ollieorder.com.
Managing Disputes in the PaySmart Portal
PaySmart merchants can manage their disputes in the Dispute Manager in their PaySmart portal:
- Login to the PaySmart merchant portal at pay.withpaysmart.com.
- Click Disputes on the left side navigation menu.
- This view will allow you to view all disputes, their statuses, response deadlines, and related payments.
Dispute Statuses in the PaySmart Portal
The PaySmart merchant users can view the status of their disputes in the Dispute Manager in the PaySmart Portal (pay.withpaysmart.com):
- INQUIRY – The issuer requests transaction evidence from the PaySmart merchant. The inquiry state seeks to resolve the dispute before engaging in the chargeback process.
- OPEN – The Paysmart merchant has received a chargeback and requires action. There is no resolution to the case.
- PENDING – There is a response pending from either party. There is no resolution to the case.
- ACCEPTED – A user has accepted the dispute, leading the dispute to expire.
- PRE-ARBITRATION – The dispute has been reopened in pre-arbitration. The PaySmart merchant will need to contact support if they want to enter arbitration.
- WON – The PaySmart merchant has provided sufficient evidence to fight the dispute.
- LOST – The PaySmart merchant has not provided sufficient evidence to fight the dispute.
- EVIDENCE_UPLOADED – Document(s) successfully uploaded to the dispute.
- UPLOAD_FAILED – Document(s) failed to upload to the dispute.
Related Fees
PaySmart merchants are subject to the following fees related to chargebacks:
- Chargeback Fee ($20) - Per occurrence, common outcome of dispute, whereby the bank forcibly reverses a payment.
- Chargeback Inquiry Fee ($20) - Per occurrence, charged by the acquiring bank if the cardholder questions a transaction before the dispute process is initiated.
Best Practices for Avoiding Future Disputes
- Clearly publish policies for refunds, exchanges, etc.
- Provide receipts to every customer
- Perform customer check-ins after purchase
- Document all customer interactions
- Try to resolve conflict with the buyer directly
- When possible, collect billing address, and zipcode
- Keep a history of tracking codes and proof of delivery/pick-up