What is a dispute?
A dispute (also known as a chargeback) occurs when a cardholder questions your payment with their card issuer.
To process a chargeback, the issuer creates a formal dispute on the card network, which immediately reverses the payment, pulling the money for the payment—as well as one or more network dispute fees—from Stripe. After that, Stripe debits your balance for the payment amount and dispute fee.
What does Bopple do to prevent fraudulent transactions?
Bopple pays Stripe an extra fee per transaction for Advanced Fraud Detection. Stripe's goal is to maximise payments from legitimate customers while minimising fraud. Fraud can be one of the most challenging aspects of running an online business. Even businesses that don’t typically see significant amounts of fraud can see sudden, unexpected, and costly attacks. Stripe prevents more than 500 million USD in payment fraud for Stripe businesses every month. To do that, they collect and analyze information that helps identify bad actors and bots, including transactional data (such as amount, customer shipping address, date, and so on) and advanced fraud detection signals (device and activity signals).
Why do disputes/chargebacks occur?
It happens when the cardholder disputes the payment, claiming it was invalid, or unauthorised, the product was never received, or the product was unsatisfactory. But sometimes, a chargeback can be fraudulent, which is most cases means the payment was made using stolen credentials. Despite the reason for a chargeback, it means that as a merchant you don't get paid for the goods and services relating to the transaction, even if you've already provided them.
Why do customers see statement descriptors that don't match what I've set in Stripe?
Customers may sometimes see a charge description on their banking app or statement that does not match the statement descriptor you've set on the corresponding charge in Stripe. Some banks and card issuers may show a friendly, human-readable merchant name (sometimes called a "soft descriptor" or "transaction descriptor") when displaying transactions to cardholders instead of displaying the statement descriptor. The friendly name is sometimes accompanied by a logo or associated image, neither of which come from Stripe.
The primary motivation for displaying friendly names is to reduce disputes and chargebacks. If a cardholder sees a transaction labelled with an opaque statement descriptor, for example, they may not recognise the transaction and dispute the charge.
Banks and card issuers use several data points from a given transaction to determine which friendly name and logo to display and different card issuers use different mapping systems, so the behaviour is not consistent across all customers or banking systems.
Stripe has no control over the mapping systems banks and card issuers use to produce friendly names for their cardholders and the friendly names displayed often use multiple data points from a transaction to determine which friendly name to display (only one of which may be the statement descriptor). If a bank or card issuer is mapping the wrong friendly name to a transaction and you've verified the information Stripe is sending to the card network is correct, the card issuer must fix the incorrect merchant name/image mapping on their end.
What are common reasons for disputes/chargebacks?
- A cardholder’s card number was stolen and used fraudulently/without their consent
- A cardholder believes that goods/services were not provided in part or in full, or were defective/damaged, or were not as described
- A cardholder believes they were charged more than once for the same purchase
- A cardholder believes they were unable to obtain a refund or replacement or credit for returned goods
What can I do as a venue owner to prevent disputes?
There are a couple of steps you can take that will bolster the protection when it comes to fraud further, such as:
Contacting customers by phone as soon as orders are placed that are over a certain value ($100+) and requesting they present their ID and credit card on arrival
- Checking the ID and card details of customers dining in for orders over a certain value
Turning off Guest checkout - This feature is great to reduce friction when it comes to ordering, but it also increases the risk of bad actors using stolen credit card details. When an end user/customer creates an account on Bopple, we can block device IDs and phone numbers to stop them from placing any future orders with that device.
Why do disputes/chargebacks happen more regularly with online orders?
Higher risk – Understand that eCommerce transactions are riskier than other transactions and are more likely to result in a chargeback as the cardholder is not present when the transaction occurs.
Can I claim a dispute/chargeback as a loss?
Yes, chargebacks (refunds) are a loss of sale or revenue. They are a cost to the business, so a reversal of revenue, a Direct Cost or Expense to the business.
Can I dispute a rejected dispute/chargeback request?
If you believe a bank or card provider has incorrectly rejected a chargeback request, you can dispute the decision. The Australian Financial Complaints Authority (AFCA) can help resolve your dispute. The AFCA is an independent dispute resolution service for consumers and small businesses. For more information, visit Australian Financial Complaints Authority.