What it means:

The customer says that the purchased product was returned or the transaction was otherwise canceled, but you have not yet refunded or credited the customer.

Required to overturn dispute:

Demonstrate that you refunded your customer through other means or that your customer is not entitled to a refund.

How to respond:

Get in touch with your customer. If you understand what their complaint is, there is a chance for you to explain the misunderstanding or to make it right. If you’re able to resolve the issue with your customer, getting them to close the dispute from their end is by far the best way for you to make sure a dispute is resolved in your favor. If they agree to do this, you should still submit evidence for the dispute. The evidence should include a statement that the cardholder said they would withdraw the dispute (including the email if you corresponded by email, included a customer communication), as well as the evidence below.

Note that you cannot issue a refund once a charge is already disputed. If you believe that your customer was owed a refund that you did not provide, you can simply choose to not submit evidence which will guarantee that they get their money back.

If you do wish to respond, you should include:
    • refund policy: Your refund policy, as shown to the customer.

    • refund policy disclosure: An explanation of how and when the customer was shown your refund policy prior to purchase.

    • refund refusal explanation: A justification for why the customer is not entitled to a refund.

How to prevent it:

Have a clear return policy, and make it easy to find. Honor your return/refund policy by issuing refunds promptly.