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My client has disputed a charge, what do I do?

Nick Rader avatar
Written by Nick Rader
Updated over a week ago

Only available for US, UK, Australia, and Canada-based coaches.

To submit evidence to respond to the dispute, please send all documents you'd like attached as a PDF to [email protected].

One of the best ways to avoid disputes is by entering a clear Statement Descriptor. The Statement Descriptor is what appears on a client's banking statement and should clearly explain what they are being charged for - the name of your product or service. 

Payments _ TrueCoach - Google Chrome 2023-01-27 at 2.39.18 PM

What is a Dispute?

A dispute (also known as a chargeback) happens when a cardholder questions your payment with their card issuer.

The issuer creates a formal dispute, which immediately reverses the payment. Both TrueCoach and Stripe have no control over this process, as the legitimacy of the payment is determined by the issuer.

The payment amount, along with a separate $15.00 dispute fee (for users in the United States) levied by the card network, is then deducted from your account balance.

So what do I do if a customer disputes a payment?

There is a dispute resolution process through which you can respond and submit evidence to make your case that the payment was valid. If the dispute is found in your favor, the disputed amount and fee is returned back to you. If a dispute is upheld, the card issuer’s decision is final, and the cardholder’s payment remains refunded.

How evidence submission works

There are multiple parties involved in the dispute process. Although Stripe is not involved in deciding the outcome of the dispute, we play a role by conveying your evidence to our financial partners. In turn, our financial partners are obligated to pass your evidence on to the card issuers if they deem it sufficient. These are necessary steps in the evidence submission process.

The acquirer reviews the evidence and decides whether it meets the card brand’s requirements to provide a potential remedy for the dispute. If it does not, the case is closed. If it presents a potential remedy, the acquirer forwards evidence to the card issuer. The issuer reviews the evidence and makes a final decision, which we communicate to you through the Stripe Dashboard. As the card issuer has final say, the acquirer’s decision to forward the evidence does not, by itself, guarantee a resolution in your favor.

There is a limited period of time that disputes can be responded to (usually 7–21 days)—the amount of time available is provided within the dispute information. After that time has passed, no further responses or evidence can be submitted. Once you have submitted a response, it generally takes the card issuer 60–75 days to reach a final decision.

Dispute evidence can only be submitted once. Make sure to provide all relevant information and review it carefully before you submit it. If you're not ready to submit the evidence you've collected so far, click Save for later. You can return to the submission process at a later time and review the evidence you've provided before submitting it.

What to submit

The evidence you submit should be appropriate to the reason for the dispute. Web logs, email communications, completed workouts, comments, proof of prior refunds, etc., can all be helpful. Stripe electronically submits this information to your cardholder’s issuer and notifies you of any updates to the dispute. Please contact [email protected] to obtain the dispute reason.

Do not include requests to call or email for more information, or links to click for further information (e.g., file downloads or links to tracking information) as these will not be actioned by the card issuer evaluating the dispute. Card issuers will not call merchants or follow external links, so it’s important to submit all available evidence through Stripe.

When you respond to a dispute, Stripe automatically formats the evidence you provide into a format accepted by card issuers. This includes all mandatory payment information (e.g., amount, date of payment), CVC or postal code verification results (if available), and any additional information or documents that you provide.

You can prepare a suitable response that has the most relevant evidence using the following best practices (click on each one to expand it and show more information). These can help ensure you have the greatest possible chance of a dispute being found in your favor—and your funds returned.

Keep your evidence relevant and to the point

Card issuers review thousands of dispute responses every day. A long introduction about your product or company, complaint about the customer, or the unfairness of the dispute isn’t going to make your responses more compelling. Instead, provide only the facts surrounding the original purchase, using a neutral and professional tone.

For example: Jenny Rosen purchased X from our company on [date] using their Visa credit card. The customer agreed to our terms of service and authorized this transaction. We shipped the product on [date] to the address provided by the customer, and it was delivered on [date].

You may want to take some time to investigate the dispute while collecting evidence to submit. For instance, you can take a look at Google Maps and Street View to see where your delivery took place, or check social media like Facebook or LinkedIn to help establish the customer as the legitimate cardholder.

Many merchants also include email correspondence or texts with the customer, but it’s important to be aware that these exchanges do not verify identity. If you’re going to include them, make sure only the relevant information is included (e.g., if you’re going to include a long email thread, redact any text that is only quoting previous emails).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

The bank professionals handling the review of your response are going to decide fairly quickly whether or not the evidence is sufficient to refute the cardholder’s claims. You can make it easier for important information to be noticed by circling or calling out important points, keeping things brief wherever possible. For responses with multiple pieces of evidence, you can also include a table of contents and give each uploaded image/PDF an attachment number or letter. A lengthy Terms of Service or refund policy that has the relevant information highlighted can make your case much clearer.Card issuers do not follow any links provided in a response. Instead, you must include a clear screenshot of your terms or policies as they appear during checkout or on your site if they are an important part of your defense (e.g., a customer disputed a subscription but there is a minimum contract term that must be adhered to).

Include proof of customer authorization

Fraudulent disputes account for over half of all disputes. Proving the legitimate cardholder was aware of and authorized the transaction being disputed is vitally important 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

Stripe always includes any AVS/CVC results as well as the purchase IP (if available from your Stripe integration), but if you have any other evidence of authorization be sure to include it.

Include proof of service or delivery

In addition to fraudulent disputes, claims from cardholders that products or services never arrived or happened, were defective or unsatisfactory, or not as described are also potential dispute reasons. Assuming that all is well on your side (the product was not faulty, was as described, was shipped and delivered prior to the dispute date) then you’ll want to provide proof of service or delivery.

For a merchandise purchase, provide proof of shipment and delivery that includes the full delivery address, not just the city and ZIP code. Choosing a carrier or delivery method that requires a signature on delivery provides the best defense against product not received or fraudulent disputes where you’ve shipped to a verified billing address that has passed AVS and ZIP code verification.If your customer provides a “Ship To” name that differs from their own (e.g., gift purchase), be prepared to provide documentation explaining why they are different. While it’s common practice to purchase and ship to an address that doesn’t match the card’s verified billing address, this is an additional dispute risk.If your business provides digital goods, include evidence such as an IP address or system log proving the customer downloaded the content or used your software or service.

Include a copy of your terms of service and refund policy

When it comes to disputes, fine print matters. Providing proof that your customer agreed to and understood your terms of service at checkout, or did not follow your policies when it comes to returns or refunds is critical. A clean screenshot of how your terms of service or other policies are presented during checkout is an important addition to your evidence—it is not enough to simply include a text copy of these.

Formatting documents and images to upload

Dispute evidence is often transmitted through several legacy systems and most card issuers are still utilizing paper faxing. Before sending your response, ensure that any text or images are clear and large enough to show up clearly in a black and white fax transmission.

While you can zoom in on your electronic documents, the card issuer will not be able to do so. Any evidence that is too small to transmit clearly won’t be considered by the card issuer, so it’s better to have large, full-page images than try to fit too many on one page.

When submitting documents or images as evidence, use the following recommendations to make sure they can remain legible:

  • Use a 12 point font or larger

  • Ensure that documents are U.S. Letter or A4 size, in portrait orientation (screenshots can still be added to your documents in landscape orientation)

  • Use bold text, callouts, or arrows to draw attention to pertinent information

  • Avoid using color highlighting

When uploading screenshots:

  • Crop the screenshot to the area of interest and circle any key components (e.g., delivery confirmation or signature)

  • Use the text fields in the dispute evidence form to describe what the image contains and how it supports your response

Any illegible text or data that is submitted with a response will be considered incomplete by the card issuer and not reviewed.

Preventing Disputes and Fraud

Disputes are an unfortunate aspect of accepting payments online and the best way to manage them is to prevent them from happening at all. An effective dispute and fraud prevention strategy uses a number of methods that are best suited for your business while keeping any customer burden—and losses—to a minimum.

Effective customer communication

Clear and frequent contact with your customers can help prevent many of the reasons for disputes. By responding to issues and processing refunds or replacement orders quickly, your customers are far less likely to take the time to dispute a payment. Make your customer service contact information prominent and keep customers updated throughout their order process and provide updates to delivery information.

You should include a clear description of your refund and cancellation policies in your terms of service. You can require your users to agree to your terms of service in order to increase the likelihood that card issuers respect your policies in the event of a dispute.

  • In general, you should make your terms of service and policies easy to find on your website, and require customers to agree to them.

  • Card issuers can be very specific about how policies are presented to your customers. If you have a checkbox that your customer must accept which only contains a link, this can often be rejected by the card issuer as unsatisfactory evidence that your customer had been aware of your policies. There must be reasonable evidence that your customer was presented with a full copy of your policies prior to their purchase.

  • When shipping physical goods to customers, use carriers and services that provide online tracking and delivery confirmation whenever possible. Provide this information to your customers as soon as it’s available (if you need to submit tracking information as dispute evidence, note that card issuers do not follow links so screenshots must be provided).

  • Use a recognizable name for your statement descriptor. This is set when you create your products and pricing plans. This helps avoid customer confusion when they look at their statement. Statement descriptors are limited to between 5 and 22 characters. They must contain at least 5 letters and cannot use the special characters <, >, \\, ', or ".

  • Avoid using the same Stripe account for separate businesses. Each Stripe account should represent a single business, which allows for separate statement descriptors and contact information. If you need to process payments for multiple businesses, you can create additional accounts for each.

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