Chargebacks (also referred to as Disputes) can be complex.
All chargebacks are disputes, but not all disputes reach the chargeback stage. A dispute is a claim filed by a cardholder or issuing bank, and it may be processed in one or multiple stages in order to receive a resolution.
There are various cycles and the status of the dispute case is defined by both the current cycle and current status, not just status alone.
There can be multiple records associated with the same dispute and understanding the status of the dispute requires an understanding of each of the chargeback records
There are multiple cycle/status combinations where the status of the dispute is not final, i.e., winning the re-presentment does not necessarily mean winning the dispute.
Cycle and Status
A single dispute case can have multiple chargeback records with different cycles and statuses. These include:
This is usually a precursor to actual chargeback where the issuer is requesting for documentation such as receipts, terms and services or proof of purchase. The chargeback cycle of Retrieval will not change and there is no financial impact to merchant
First Chargeback and Re-presentment
Chargeback status of first usually indicates an incoming chargeback that has not been responded to, or has been pre-determined as Won or Lost. Once responded to, a first chargeback becomes a re-presentment. In most cases, a first chargeback will trigger a debit to the merchant and a re-presentment will trigger a credit to the merchant.
The pre-arbitration chargeback is also referred to as the second chargeback. This is where issuer rejects the re-presentment and decides to pursue the chargeback further. This typically results in a debit to the merchant, same as first chargeback. When a pre-arbitration chargeback is responded to by the merchant, it usually results in a credit to the merchant, same as re-presentment.
If a merchant responds to a pre-arbitration and issuer does not accept the response, the case becomes an arbitration chargeback. The merchant can then either choose to accept liability, or ask the card network to make a final decision at a cost.
Chargeback Cycle / Status combinations
Final = Dispute is final. The case is closed and can no longer be responded to.
Green = Chargeback results in merchant receiving a credit.
Orange = Chargeback results in merchant being debited.
Yellow = No financial impact to the merchant.
Grey = Not valid.
Chargeback Cycle / Status Transitions
Chargeback API Endpoints
There are 5 API endpoint resources associated with chargebacks, however all that a Partner will generally use is /chargebacks which will return all the necessary results necessary to track the stages of a chargeback.
Main API endpoint containing list of chargebacks
Incoming chargebacks can be managed either through web hook notifications or through pulling data directly.
Chargeback Webhook Notifications
A new chargeback has been created
A chargeback has been updated
Chargeback status changed to open
Chargeback status changed to closed
Chargeback status changed to lost
Chargeback status changed to won
Chargeback Data Collection
We recommend data to be synchronized daily either by “created” or “modified” fields.
Below is a sample query which retrieves all chargebacks created on Nov 2nd, 2020:
GET /chargebacks SEARCH: created[like]=2020-11-02%25
System generated ID
Timestamp of when chargeback was created
Timestamp of when chargeback was last modified
Login ID of the user created the chargeback
Login ID of the user who last modified the chargeback
ID of the merchant (merchants) resource
ID of the transaction (txns) resource
Total amount of the chargeback
Total amount of the representment
Cycle of the chargeback
The processor platform ID
Chargeback Reference Number
Reason for the chargeback
Reason Code for the chargeback
Date the chargeback is issued (YYYYMMDD)
Date the chargeback was received by processor (YYYYMMDD)
Latest date by which the response must be received by (YYYYMMDD)
ID of the last chargebackStatuses
Whether the chargeback is actionable (i.e. can be responded via API)