Disputes are initiated by a credit card company and indicate that a charge is suspected of being wrongfully processed for one reason or another. The process works like this:
- A cardholder disputes a charge via their card issuer.
- The card issuer notifies Neon Pay about the dispute.
- Neon Pay immediately refunds the cardholder.
- The merchant may submit evidence to the card issuer via Neon Pay to contest the dispute. A merchant may also concede the dispute.
- The card issuer rules on the dispute. If the merchant wins, funds are retrieved from the cardholder. If the cardholder wins, they keep their money.
Approaches to Handling Disputes
While APIs are available to integrate this functionality into Applications, the Merchant Portal provides a complete user interface for responding to (and conceding) disputes. It is not strictly necessary to integrate this functionality into Applications. Instead, we recommend you direct your users to the Merchant Portal to perform these actions.
Users have two options when a dispute has been received: contest or concede.
Contesting a Dispute
Contesting a dispute involves providing evidence that a charge was, in fact, legitimate. An organization must send documentation to the credit card company to support the idea that the charge was legitimate. Neon Pay provides an interface in the merchant portal for users to do this.
The credit card issuer will rule the outcome of a dispute. If a dispute is lost, the customer will be refunded for the charge. If a dispute is won, the merchant will be awarded the charge.
Conceding a Dispute
Conceding the dispute will result in a full refund of the charge and a closure of the dispute. This can be done manually in the merchant portal. If no action is taken on a dispute within a certain amount of time (typically 30 days), the dispute will automatically be conceded and closed.
Listening for Disputed Charges
Neon Pay provides webhooks for notifying your application of disputed charges. We recommend you listen for notifications of disputed transactions and flag these transactions within your application. Then, provide your users with a link to the dispute record in Neon Pay’s Merchant Portal.