Dispute Evidence: Best Practices
For information on SEPA Direct Debit disputes, take a look at the SEPA Direct Debit documentation.
Chargeback evidence is compiled by a merchant to refute a cardholder’s claims. Depending upon the reason for the chargeback, the information necessary may vary, but there are some basics to creating a successful and compelling response. Stripe assists you by assembling your evidence in a format accepted by the banks, including all of the mandatory case details (case number, amount of charge, date of charge) as well as any security check results (CVC and AVS.) Banks accept evidence only once for any given dispute, so it’s important that you are making your best case right out of the gate.
1. Straight to the Point
Many thousands of merchant chargeback responses are reviewed by banks every day. A long introduction about your product/company or a general complaint about the customer or the unfairness of the chargeback isn’t going to make your responses more compelling. Instead, stick to the facts surrounding the original sale, using a neutral and professional tone. For example: “John Doe purchased X from our company on [date] using their credit card. They 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.]” Be factual, professional, and concise. While too little evidence is a problem, overwhelming the bank with too much is just as bad!
2. Make it Easy and Clear
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. Make their job easier by bolding or italicizing important points, including a table of contents (give each uploaded image/PDF an attachment number or letter, and list these key pieces of evidence in a table of contents), and keeping things short wherever possible. A 10-page long Terms of Service won’t be very helpful if the person has to go hunting for the cancellation or refund policy portions, so it’s best to include only the applicable portions or ensure they are clearly highlighted. Remember banks will not follow links to your website, so showing a clear screenshot of your terms/policies as they appear during checkout or on your site is essential if your terms and conditions are an important part of your defense (for example, subscription cancelled or credit not processed claims.)
Additionally, banks often fax evidence using traditional black and white paper faxing, so remember that color highlighting is unlikely to be helpful. Utilize callouts/arrows/bold text to draw attention to pertinent communications, and make sure your images are high-quality and able to be read on an 8 ½" x 11" or A4 standard page - while you can zoom in on your electronic documents, the bank will not be able to do so. Any evidence that includes text or images/images with text that are too small and transmit unclearly will not be considered by the bank.
3. Details Matter
While keeping your response concise is great, don’t leave out relevant data that could be the difference between compelling evidence and an incomplete response. Review and implement quality control on your responses to ensure data isn’t missing, incorrect or confusing. Remember that the bank investigator doesn’t know your business like you do, and may not be familiar with nuances of your product, services, or backend software (logging work performed, logins, service usage, etc..) Your goal is compiling key pieces of evidence to refute the cardholder’s claims and the specific reason code for the dispute. Do some investigating on your side if necessary - take a look at Google maps/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 want to include email correspondence or texts, but it’s important to be aware that these exchanges do not verify identity, and if you’re going to include them keep the submission neat and clean (if you’re going to include a long correspondence history, redact the emails if each one is quoting previous emails, for example.)
4. Show Proof of Authorization
Fraudulent chargebacks account for over 50% of all chargebacks. 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, such as AVS (address verification system) matches, CVV/CVC confirmations, signed receipts or contracts, or an originating IP matching the cardholder’s verified billing address are a standard part of a compelling response. 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.
5. Show Proof of Service/Delivery
Fraudulent chargebacks are not the only type to worry about! Claims from cardholders that products are of defective or not as described or claims that they never received their product are also valid chargeback types. Assuming that all is well on your side - the product was not faulty, was as described, and was shipped and delivered prior to the dispute date, you’ll want to provide proof of service/delivery. For a merchandise purchase, provide proof of shipment and delivery that includes the full delivery address and not just the city/town and ZIP code. Although we know it’s inconvenient and may affect conversion, choosing a carrier or delivery method that requires signed receipt of merchandise provides the best defense against product not received chargebacks or fraudulent chargebacks where you’ve shipped to a verified billing address. If your customer provides a ship to name that differs from their own (for gifts, etc.), be prepared to provide documentation explaining why they are different. It’s common practice to purchase and ship to an address that doesn’t match the card’s verified billing address, but every such charge presents additional chargeback risk. If your business provides digital goods, include evidence such as an IP log or system notes to prove the customer used the software or service or received downloaded content.
6. Include Terms of Service and Refund Policy
In the world of chargebacks, fine print matters - the guidelines provided by card issuers, which are being adhered to by bank investigators, are basically full of their own fine print! Providing proof that cardholders agreed to and understood your terms at checkout, and/or did not follow protocol when it comes to returns or refunds is critical. Require customers agree to your terms before they complete a purchase and include a checkbox they can tick when checking out. Banks can be very picky about how Terms are presented, and many will not accept a checkbox that only includes a link to the full Terms - consider surfacing pertinent terms (such as refund or return/cancellation policies) in full text on the checkout page or a pop-up with a requirement to “agree” prior to submitting the order. A clean screenshot of how Terms are presented during checkout is an important addition to your evidence - remember, banks won’t visit your website. When it comes to your checkout flow and website it’s important to show, not tell.
Before sending your response, ensure that any text or images are clear enough/large enough (it’s better to have large, full-page images than try to fit too many on one page) and will show up clearly in the fax transmission (most banks are still utilizing paper faxing) as any illegible text or data will be considered incomplete. For formatting help, visit our support documentation.
While chargebacks in the card-not-present environment are basically unavoidable, and crafting the best chargeback response can be challenging, by following these practices you’ll have the best chance possible of recovering revenue for your business.