When you're using Shelterpay powered by Stax, there may be times when a cardholder disputes a transaction that they made with your organization. This is also known as a chargeback. Chargebacks are a preventable but not completely avoidable part of accepting cards; fortunately, Stax makes it easy to handle these directly within your Stax Dashboard.

The Dispute Process

After a cardholder completes a transaction at your organization, they generally have 120 days to file a dispute with their bank if they believe they are owed a credit back. Disputes can be filed for many different reasons - suspected fraud, duplicate charges, services not as described, etc. 

When the cardholder files the dispute with their bank, their bank sends the dispute information to Stax, along with a request for the funds from the transaction. Stax must send the cardholder's bank the funds immediately, thus Stax must also debit you for the funds immediately. Along with the debit for the disputed charge, you will also be debited a $25 chargeback fee which covers the cost of processing the chargeback. Currently, debits for a dispute do not report into Shelterluv, so if a deposit in your bank account does not match up with your Shelterluv accounting reports, it may be because you received a dispute.

You will receive an email notification to your Stax account administrator's email address notifying you of the dispute as soon as it is reported to Stax. (Your Stax account administrator can add additional email addresses to receive those notifications by navigating to Settings --> Notification Settings within the Stax dashboard.) The email notification will look like this:

You may then click "See Details" to navigate to the dispute in your Stax Dashboard and upload your response to the dispute if you would like to refute it. Note that you have a limited amount of time to upload your response after the dispute was initially reported; this can be anywhere from 7 days to a month depending on the card brand.

After you upload a response, you will typically receive a provisional credit back for the dispute within 2-3 business days. Your response will be reviewed by the card brand (i.e. Visa, Mastercard, etc) and the cardholder's bank, which can take up to 45 days.

If the dispute is ruled in your favor, you will keep the credit that was issued to you, and the status of the dispute will be updated to "Won". If the dispute is ruled in the cardholder's favor, the disputed amount will be debited from your account again, and the status of the dispute will be updated to "Lost". Note that neither Stax nor Shelterluv has any say over the ruling of a dispute; the decision is made entirely by the card brand.

With some disputes, you may be required to respond with additional documentation after the card brand reviews your initial response. This is called "pre-arbitration". You will receive an email notification if this occurs, with the subject line "Update on Disputed Payment." The email will look like this:

You will also receive an email from Shelterluv (help@shelterluv.com) letting you know that additional information is being requested for the dispute. If you receive an email like this, you should reply with new documentation along with a written explanation confirming why the cardholder is not owed the refund. Note that if you do not reply with any additional documentation, you will automatically lose the dispute.

Dispute Prevention and Responses

Here are some best practices to help prevent cardholder disputes:

• Ensure that you present a contract during every transaction, and that your contract explains your refund policy in detail.
• Reconcile your bank account with your Shelterluv accounting reports frequently to identify any incorrect transactions.
• List your organization's phone number on your website so that if a customer has a question about a transaction, they can easily contact you.

When responding to a dispute, here are some helpful documents to include in your response:

• A copy of the signed receipt
• A copy of the signed contract with your refund/return policy highlighted
• A brief description of the transaction and interaction with the customer

As always, feel free to reach out to us anytime for assistance at help@shelterluv.com, we're happy to help!