The chargeback disputation process can be overwhelming, especially when a merchant begins looking over all of the reason codes (RC) from the various Card Associations. The thought of creating response templates for each RC can be daunting, but never fear; this article is here to help.
So where do you start with your response templates? I recommend creating templates for Visa’s RC 75 (Does not recognize) and RC 83 (Fraud) and build your template base out from there, making adjustments by RC requirements. Starting here should give you a solid foundation and reduce headaches. By having solid pre-prepared templates, you can easily customize them as needed to increase your chance of a reversal.
Note: It is important to keep in mind the dispute packet should not be more than 18 pages long due to MasterCard’s 20-page limit.
To reduce the stress of creating chargeback response templates, be sure to include the basic information required across most RC’s. Below is a list of data that are required or should be included in many response packets:
- Transaction information: Order info, quantity, price, receipt date, proof of delivery, cardholder information, address (billing and ship to), date and time of purchase, email address, any other personal identifying info supplied
- AVS and CVV2 auth codes
- Screen shot of the buy process, electronic signature (check box with “I agree to TOS”), Terms of Service (TOS), etc.
- Refund/Return policy and screen shot of each
- Proof of usage, login information, GEO, location, Device ID customer service contact, etc.
- Note: Physical goods = proof of delivery (POD) digital goods = proof of usage, login, etc.
By having the above information readily available, you will have the basic construction for most of your dispute packets, which will assist you in providing potential evidence in reversing a chargeback.
Why do you need so much information as “evidence” in your supporting documents? Let’s consider an imaginary (but realistic) scenario as an illustration. Imagine a cardholder - we’ll call him Charles – who has contacted his issuing bank and claimed the charges on his card with your establishment are fraud. Now, you and Charles both know he has engaged in the transaction(s); however, he doesn’t think you can “prove” it to his bank, and he wants to recoup the money he spent.
You have a surprise for Charles, though. Your records allow you to provide a wealth of information about his interactions with your company and your site: you know each time he logged in, his usage logs, POD, his device ID, GEO location, all of the personal identifying information he supplied in the transaction, customer contact (including the times he called trying to negotiate obtaining free goods from your customer service team), and so on. You know just about everything about him except his shirt size, and if you happen to sell shirts, you know that about him, too. Charles is now at an impasse. He must continue the dispute with his issuing bank, explain away the supporting evidence or accept the charges.
When the above scenario is played out by the cardholder, issuing bank, processor and Card Association, the merchant has a far better chance of a reversal. The processor will likely understand the cardholder engaged in the transaction, the issuing bank may push back on their customer, and it's possible the cardholder will drop the chargeback altogether. Additionally, if the chargeback goes to pre-arbitration or arbitration, the merchant will have done all they can to supply evidence to show the cardholder engaged in the transaction.
By Gina Lucas, VP of Chargeback and Fraud/Risk Management, VeriSect
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