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Chargeback for Transaction Disputes
A chargeback process provides a way for your customers to reverse the amount of a disputed transaction if they experience issues, such as receiving damaged goods, incorrect billing, or unauthorized charges. By integrating Transaction Dispute Management with Mastercom®, you can streamline the chargeback process to facilitate a reliable and transparent dispute resolution. Use prebuilt flows, Omniscripts, integration definitions, and Stage Management to create the end-to-end chargeback process.
A typical chargeback process for a credit card transaction can include these stages:
Transaction Initiated
A cardholder makes a purchase by using a credit card. The transaction is processed and completed and involves the cardholder, merchant, acquirer (merchant’s bank), and issuer (cardholder’s bank).
Dispute Intake
The cardholder identifies a problem in the transaction and contacts their issuer to dispute the transaction. At times, certain systems used by the issuer can also proactively detect issues with a transaction, especially if it’s a case of potential fraud.
Raise Merchant Alerts
The issuer raises an alert for the disputed transaction and collaborates with a merchant alert provider, like Ethoca Merchant Alerts™ to resolve the dispute without any chargeback. If the merchant rejects the alert or doesn’t respond to the alert within a specified time, the issuer can initiate a chargeback.
Initiate Chargeback
In most cases, the issuer initiates the chargeback by reversing the transaction on a provisional basis. It debits the transaction amount from the acquirer and credits it to the cardholder’s account.
Merchant Response
When the merchant receives the chargeback, they can either accept the chargeback or provide evidence to dispute the chargeback. If the merchant agrees with the dispute, the chargeback process ends. If the merchant believes the chargeback is invalid, they can dispute the chargeback by providing evidence to prove the credibility of the original transaction.
Second Presentment
If the merchant disputes the chargeback, the transaction is presented again to the issuer with additional information. This stage of the dispute resolution is known as the second presentment.
Issuer Review of Second Presentment
The issuer reviews the evidence provided by the merchant, and can decide to either accept or reject the second presentment. If the issuer considers the evidence as insufficient, the issuer must respond by rejecting the second presentment with supporting evidence. This response initiates the arbitration process between the issuer and the merchant. If the evidence is satisfactory, the chargeback is reversed, and the funds are returned to the merchant’s account.
Pre-arbitration
If the issuer rejects the second presentment, the dispute enters the pre-arbitration phase. During the pre-arbitration phase, the issuer and the merchant have an opportunity to negotiate and present additional evidence to resolve the dispute without escalating it to arbitration. Pre-arbitration phase aims to reach a mutual agreement and avoid the need for a binding decision by an external party. If the parties can resolve the dispute during pre-arbitration, the chargeback process concludes. If not, the dispute proceeds to arbitration.
Arbitration
When pre-arbitration doesn’t settle the dispute, the process moves to arbitration. In the arbitration phase, a third party, often a card network, reviews all the evidence and arguments presented by both the issuer and the merchant. The arbitrator makes a binding decision based on the merits of the case. This decision determines the outcome of the dispute, ensuring a fair resolution for both parties involved.
- Configure the Endpoint for Mastercom®
Create external credentials and named credentials with details of how Salesforce is authenticated with Mastercom. - Set Up Integrations with Mastercom® for Chargebacks
Use integration definitions to specify the details of how Salesforce integrates with Mastercom to initiate chargebacks for transaction disputes. Create integration definitions to call the Mastercom APIs. - Set Up Integrations with Mastercom® for Second Presentment
Transaction Dispute Management uses integration definitions to specify the details of how Salesforce integrates with Mastercom to address the second presentment received in response to a chargeback. Create integration definitions to call the Mastercom APIs. - Set Up Integrations with Mastercom® for Pre-Arbitration and Arbitration
Transaction Dispute Management uses integration definitions to specify the details of how Salesforce integrates with Mastercom to initiate pre-arbitration and arbitration processes in response to a second presentment. Create integration definitions to call the Mastercom APIs. - Flows for Initiating Chargeback and Reviewing Second Presentment
To streamline and automate the process of initiating chargebacks and reviewing the second presentment, use prebuilt record-triggered flows and screen flows. - Update Omniscript to Collect Chargeback Details
Give your dispute case owners a guided process to review the details of a disputed transaction and decide whether to proceed with a chargeback. Update the Omniscript and use it in the Stage Management Plan for initiating a chargeback. - Collect Pre-Arbitration and Arbitration Details
Give your dispute case owners a guided process to collect the details required for initiating pre-arbitration or arbitration for a disputed transaction that wasn’t resolved during the second presentment. With the guided process, dispute case owners can update the reason code and reason subcode if the ones assigned during the chargeback are no longer appropriate. - Review Pre-Arbitration and Arbitration Details
Give your dispute case owners a guided process to review the details collected for initiating pre-arbitration. With the guided process, dispute case owners can either accept pre-arbitration and close the dispute or escalate the case to arbitration. - Set Up a Decision Matrix to Identify Reason Codes for Pre-Arbitration
When a disputed transaction isn’t resolved during the second presentment, you can initiate pre-arbitration or arbitration based on the reason code that’s associated with the transaction. Mastercom mandates that disputed transactions with specific reason codes must undergo pre-arbitration before they can proceed to arbitration. For example, pre-arbitration is required where the dispute is associated with reason codes, such as 4808, 4837, and 4853. - Configure Dispute Reason Codes and Reason Subcodes
When an agent captures a transaction dispute request, they must select an appropriate reason code and reason subcode that best describe the issue in the disputed transaction. To make sure that these codes are available during the dispute intake process, add them as picklist values, and create dispute reason records. - Stage Management Plan for Transaction Dispute Management
Use Stage Management to set up a smooth and efficient process for resolving transaction disputes in each stage of the dispute lifecycle. - Add the Record Stage Overview Lightning Component to the Dispute Item Record Page
Give your dispute case owners a comprehensive view of the stages and the steps to be performed in the chargeback and second presentment processes. - Add the Integration Execution Status Lightning Component to the Dispute Item Record Page
Show your dispute case owners the execution status of integration callouts. These callouts are added in the stage management plan to initiate chargeback and to review second presentment.
