> ## Documentation Index
> Fetch the complete documentation index at: https://docs.arcuserp.com/llms.txt
> Use this file to discover all available pages before exploring further.

# Handle Payment Disputes and Chargebacks

> Investigate customer payment disputes, submit evidence, and resolve chargebacks through your payment processor.

<Note>
  When a customer disputes a charge with their bank or payment provider, you have a limited time window to submit evidence and respond. Act quickly to protect your business.
</Note>

## When to use this workflow

* A customer disputes a charge with their credit card issuer
* A payment was marked as fraudulent
* A customer claims they were double-charged
* You need to submit evidence (invoice, proof of shipment, communication) to dispute a chargeback

## What is a dispute?

A dispute occurs when a customer or their bank challenges a transaction. Common reasons include:

* Customer claims the order was unauthorized (fraud)
* Customer says they never received the item
* Customer claims the item arrived damaged or defective
* Amount discrepancy (charged different amount than agreed)
* Duplicate charge

## Responding to disputes in Arcus

### Step 1: Locate the disputed transaction

1. Open the customer account.
2. Click the **Payments** tab.
3. Look for transactions marked as **Disputed** or **Chargeback** (typically highlighted in red).
4. Click the disputed transaction to open details.

***

### Step 2: Review the dispute reason

In the dispute details, you'll see:

* **Dispute reason code** (from the customer's bank)
* **Dispute amount**
* **Timeline** (when the dispute was filed)
* **Deadline** to respond (typically 7-14 days)
* **Customer's claim statement** (what the customer told their bank)

***

### Step 3: Gather evidence

Collect documentation to prove the transaction was legitimate:

| Evidence                        | Where to find it                                                               |
| ------------------------------- | ------------------------------------------------------------------------------ |
| **Invoice**                     | Accounting > Invoices or click **Email Invoice** to resend                     |
| **Order confirmation**          | Click the order and select **Email Order Confirmation**                        |
| **Packing slip**                | Fulfillment tab > shipment > download Packing Slip                             |
| **Shipping proof**              | Fulfillment tab > tracking number > carrier website screenshot                 |
| **Customer communication**      | Email Log or Communication > Message history                                   |
| **Return/refund documentation** | Returns tab for any related returns                                            |
| **Address match**               | Verify billing address matches shipping address (fraud indicator if different) |

***

### Step 4: Submit response in Arcus

1. In the dispute details, click **Submit Response** or **Contest Dispute**.
2. Upload or paste your evidence:
   * Invoice and order details
   * Tracking information and delivery confirmation
   * Communication with customer (emails, chat logs)
3. Add a brief explanation:
   * "Order was delivered to the address on file on \[date] per \[carrier] tracking \[number]."
   * Or: "Customer requested a refund, which we processed on \[date]. No chargeback should be necessary."
4. Click **Submit**.

**Expected result:** Your evidence is sent to the payment processor (Stripe, etc.) and the bank reviews it. You'll be notified of the outcome within 5-10 business days.

***

## Common dispute scenarios

### Scenario 1: Fraud claim (unauthorized transaction)

**Customer claim:** "I didn't authorize this charge."

**Your response:**

* Submit the order with proof that it was placed from the customer's IP and email.
* Include the invoice showing delivery to their address.
* Provide tracking confirmation.
* If payment was made by card, note that address verification (AVS) and CVV matched.

***

### Scenario 2: Item not received

**Customer claim:** "I never received the order."

**Your response:**

* Submit the tracking number and delivery confirmation from the carrier.
* Screenshot of the carrier's tracking page showing delivery date, time, and location.
* Show that the customer signed for the package (if applicable).

**Note:** If the item was truly lost in transit, you may need to issue a refund or reship the item.

***

### Scenario 3: Item not as described

**Customer claim:** "The item arrived damaged / is not what I ordered."

**Your response:**

* Submit the original order and invoice showing the exact item and description.
* Include communication with the customer (if any) acknowledging their concern.
* Show that a return or replacement was offered.

**Note:** A damage claim may be covered by your shipping carrier's insurance (Shippo, etc.). File a claim separately if applicable.

***

### Scenario 4: Duplicate charge

**Customer claim:** "I was charged twice."

**Your response:**

* Show that only one invoice was issued.
* Explain if there were multiple attempts (e.g., first payment failed, second succeeded).
* If truly a duplicate, issue a refund and explain it to the customer.

***

## GL impact

When a dispute is filed:

* **No GL entry** until the dispute is resolved.
* If dispute is **won** (you retain the payment): No change to GL.
* If dispute is **lost** (payment is reversed): A reversal GL entry is created (debit to Dispute Loss Expense, credit to Cash).

***

## Timeline and deadlines

| Event             | Timeframe | Action                            |
| ----------------- | --------- | --------------------------------- |
| Dispute filed     | Day 0     | You're notified in Arcus          |
| Response deadline | Day 7-14  | Submit evidence before deadline   |
| Bank review       | Day 7-30  | Payment processor and bank review |
| Outcome           | Day 30+   | Final determination (won or lost) |

***

## Tips for winning disputes

1. **Act fast:** Don't wait until the last day to submit evidence.
2. **Be concise:** One clear, well-organized response is better than multiple rambling ones.
3. **Track everything:** Keep screenshots of tracking, delivery confirmations, and customer communication.
4. **Address verification:** Use AVS (Address Verification System) and CVV matching to reduce fraud disputes.
5. **Clear shipping terms:** Make sure order confirmations clearly state shipping and delivery expectations.
6. **Communication:** Keep copies of all communication with the customer (emails, chat logs, notes).

***

## Preventing disputes

1. **Clear order confirmations:** Make sure customers understand what they ordered and the total amount.
2. **Tracking updates:** Send shipment notifications with tracking numbers.
3. **Delivery confirmation:** Request signature confirmation for high-value orders.
4. **Responsive customer service:** Address concerns quickly (damaged items, missing items) before they escalate to disputes.
5. **Return policy:** Have a clear, easy return process so customers use it instead of disputing.

***

## Related articles

<CardGroup cols={2}>
  <Card title="Record Payment" icon="credit-card" href="/support/orders/record-payment">
    Record and manage customer payments.
  </Card>

  <Card title="Customer Returns" icon="arrow-up-from-bracket" href="/support/returns/customer-returns">
    Process returns as an alternative to chargebacks.
  </Card>

  <Card title="Email Log" icon="envelope" href="/support/communications/email-log">
    View customer communication history for evidence.
  </Card>

  <Card title="Shipments and Tracking" icon="box" href="/support/orders/packing-shipping">
    Manage shipments and tracking for proof of delivery.
  </Card>
</CardGroup>