Handling disputes

Common types of disputes and how to handle them

Laura from Montonio avatar
Written by Laura from Montonio
Updated over a week ago

What is a dispute?

In the world of online payments, disputes can arise between customers and businesses for various reasons. A dispute, also known as a chargeback, occurs when a customer questions a payment made through Stripe with their card-issuing bank. Disputes can be initiated for several reasons, such as unauthorized charges, billing errors, or dissatisfactory services or products.


Common types of disputes in Stripe:

Unauthorized Transactions

This type of dispute occurs when a customer claims that they did not authorize a payment made through their credit card. It could be due to stolen card information, identity theft, or fraudulent activity. In such cases, the customer requests a chargeback, and the burden of proof falls on the business to demonstrate that the transaction was indeed authorized. When a transaction is processed with 3DS enabled, the liability for fraudulent charges typically shifts from the merchant to the cardholder's bank, provided that the transaction was successfully authenticated.

☝️If you use Montonio x Stripe (new card payments 2024) maximum 3DS is enabled for all merchant accounts and fraud rules are constantly monitored.

Duplicate Charges

A duplicate chargeback happens when a customer believes they have been billed multiple times for the same purchase. This can be an honest mistake on the part of the business or the customer, but it still requires resolution to avoid any customer dissatisfaction.

Product or Service Not Received

If a customer claims they did not receive the product or service they paid for, they can initiate a dispute. This may be due to shipping issues, delivery delays, or misunderstandings about the fulfillment of the purchase.

Product or Service Not as Described

In this type of dispute, the customer alleges that the product they received differs significantly from what was described or advertised. This could include items being damaged during shipping, incorrect specifications, or misleading marketing claims.

Credit not processed

Sometimes, a customer may dispute a refund that they believe should have been processed but wasn't. This could be a refund for a canceled order or a returned product, which the customer claims they have not received.

☝️ Please note that disputes can only be initiated for card payments and not for bank link payments.


How to handle disputes:

If you encounter a dispute in Stripe, it is essential to address it promptly and professionally. Here are some steps to follow:

  1. Communicate with the customer: Reach out to the customer and try to understand the reason for the dispute. Often, simple misunderstandings can be resolved through open and clear communication.

  2. Provide evidence: Gather all relevant transaction details, receipts, shipping information, and communication with the customer. This evidence can be submitted to Stripe to dispute the chargeback on your behalf.

  3. Adhere to deadlines: Stripe provides a limited window to respond to disputes. Make sure to meet these deadlines to avoid automatic chargebacks.

  4. Learn from the dispute: Analyse the root cause of the dispute and use it as feedback to improve your products, services, or processes to prevent future issues.

  5. Review your Stripe account settings: Ensure that your Stripe account is configured correctly to minimize the risk of disputes. Use the built-in fraud prevention tools and follow Stripe's best practices. With Montonio x Stripe (Card payments 2024) maximum 3DS is enabled for all merchant accounts and fraud rules are constantly monitored.

Refunding a dispute ❌

Once a card payment is disputed, issuing a refund for that transaction becomes unavailable until the dispute is withdrawn or resolved. Only after the dispute is settled can a refund be processed as usual.

How do you know that a payment is disputed?

With Montonio x Stripe (Card Payments 2024), you don't need to worry about monitoring disputes. Montonio automatically detects disputes on your behalf and if a payment is disputed, you will promptly receive a notification on your email.

Disputes can be challenging for businesses, but handling them efficiently and professionally is crucial to maintaining a positive customer relationship and reducing potential losses. By understanding the types of disputes and following the recommended steps, you can navigate through these situations and continue providing a great experience for your customers.


If you have additional questions and need our help, feel free to contact our support team via the chat in the bottom right corner.

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