The dispute process includes several phases. Here is a breakdown of terms and tips for handling disputes.
Cardholder: The customer disputing the transaction
Merchant: Provided the goods and services being disputed
Issuing Bank: The bank
This is usually a precursor to an actual Chargeback and is a documentation request from the Issuer. Documentation includes receipts, terms, and services or proof of purchase. The Chargeback cycle of Retrieval will not change, and there is no financial impact on the Merchant. You can skip this step and go directly to First Chargeback.
Important: failure to respond to a Retrieval Request promptly will often become a Chargeback, and because they ignored the request, the Merchant will have given up their right to fight the Chargeback.
First Chargeback and Re-Presentment
A First Chargeback usually indicates an incoming Chargeback that has not been addressed or has been pre-determined as Won or Lost. Once responded to, a First Chargeback becomes a Re-Presentment. In most cases, a First Chargeback will trigger a debit to the Merchant, and a Re-Presentment will trigger a credit to the Merchant.
Pre-Arbitration Chargeback (Second Chargeback)
The Pre-Arbitration Chargeback is also referred to as the Second Chargeback. This is where the Issuer rejects the Re-Presentment and decides to pursue the Chargeback further. This typically results in a debit to the Merchant, the same as First Chargeback. When a Pre-Arbitration Chargeback is responded to by the merchant, it usually results in a credit to the Merchant, the same as Re-Presentment.
If a Merchant responds to a Pre-Arbitration and the Issuer does not accept the response, the case becomes an Arbitration Chargeback. The Merchant can either accept liability or ask the network to make a final decision at a cost.
If a customer initiates a dispute...
If a customer initiates a dispute, you'll receive an email notifying you of the situation.
To find your Disputes dashboard, where you can manage and respond to individual disputes:
- Click the "Payments" menu on the left side of your InkSoft app (under the "Financials" header), and then click "Manage Disputes" at the top of the new screen.
- If you are not already signed in to your payment portal, you will be prompted for your payment portal's login credentials (which are separate from your InkSoft.com login credentials).
- Click "Disputes" on the left-side menu.
- On the Disputes page, click on the dispute you want to respond to. Only disputes that have the Open status can still be responded to.
Decide how you would like to respond to the dispute...
Option 1: Accept Liability
You may choose to voluntarily concede to a dispute by accepting liability. When you click the Accept Liability button, you will be prompted to enter the dollar amount you concede to the cardholder. By default, the full disputed amount will be populated, but you may also concede a partial amount and submit a representment for the remaining disputed funds.
Option 2: Representment (Respond with Compelling Evidence)
If you choose to challenge a dispute, you can respond with a representment and upload compelling evidence in your defense.
To submit a representment:
- On the dispute, click "Respond."
- Enter your email address in the "Contact" field.
- Add any additional notes to the issuing bank in the "Note" field.
- Click "+ Attach Document" to upload your supporting evidence.
- Review that you have supplied everything you would like to provide to the cardholder's issuing bank. Note: Once you submit your response, you cannot modify or add to it in any way.
- If you need more time to review, click "Save for Later."
When you're confident you're ready to send your information to the issuing bank, click "Submit Response."
The replied-to dispute will remain on your Disputes management page. No matter the outcome, you will be informed of the dispute's resolution via email.