Preventing disputes, which is worth considerably more than winning them.
Most disputes are not fraud. They are customers who did not recognise a charge, could not reach you, or forgot they subscribed. All three are fixable in an afternoon, and fixing them is worth more than any improvement in how you fight.
What this page settles.
Three questions, in the order most people ask them.
Where disputes actually come from
The mental picture most merchants have is a stolen card. That is a real category and it is not the largest one.
A substantial share of disputes — including many filed under fraud codes — come from three entirely ordinary situations:
The customer did not recognise the charge. They looked at their statement, saw a company name they had never heard of, and reported it. They were not lying; they genuinely did not know who you were.
The customer could not reach you. They wanted a refund, tried, failed, and called their bank instead. The bank is the customer service line of last resort and it is always answered.
The customer forgot. A subscription, a free trial that converted, an annual renewal. The charge is legitimate and entirely unexpected.
None of those is a fraud problem. All three are fixable without spending anything, and together they are worth more than any improvement in how you handle disputes after the fact.
The descriptor, which is the biggest single win
Your billing descriptor is the text that appears on your customer’s card statement. If it is your holding company, a legacy trading name, or an abbreviation nobody outside your business would recognise, you are generating disputes continuously and attributing them to fraud.
Change it to the name customers actually know you by. If your processor allows a phone number in the descriptor, include one — a customer who can call you does not call their bank.
Then test it: make a small purchase from yourself and look at how it appears on the real statement. Not how it is configured. How it appears. More on descriptors.
This is a fifteen-minute change and it is routinely the largest single reduction available to a merchant.
Be reachable, and refund quickly
Publish a phone number and answer it. Publish an email address and monitor it. Put both somewhere a customer can find in ten seconds — your website footer, your receipts, your order confirmations.
Refund borderline complaints immediately. This is the piece merchants resist and it is the clearest arithmetic on the page. A refund costs you the sale. A chargeback costs you the sale, the goods, the fee, and a mark against your ratio that stands even if you win.
Once a dispute is filed, refunding does not make it go away, and you can end up out both. The window to be generous is before, not after.
If somebody on your team has authority to spend £50 on a courier but not to refund £30 to stop a dispute, the policy is costing you money.
Subscriptions, which cause more than their share
Recurring billing produces disputes out of all proportion to its volume, almost entirely from people who forgot.
Email before you charge, not after. A few days’ notice on a renewal, saying what is coming and how much.
Make cancellation easy and obvious. A cancellation that requires a phone call during business hours produces chargebacks. It does not retain customers; it converts them into disputes.
Say the dates clearly at sign-up, especially on free trials. “Free for 14 days, then £29 a month from 22 October” prevents the dispute that “free trial” guarantees.
Use an account updater through your gateway so expired cards refresh rather than failing and retrying. Gateway features.
Honour cancellations immediately. A payment taken after cancellation is a processing-error dispute you will lose, deservedly.
Card-not-present specifics
Turn on address verification and the security code, and act on the results. These also improve your interchange, so the per-transaction fee usually pays for itself twice.
Use 3-D Secure where it suits your business. It shifts liability for fraud disputes and adds friction at checkout; whether that trade works depends on your margins and your conversion rate.
Be careful about shipping to an address different from the billing address. This is where card-not-present fraud concentrates, and it is where non-receipt disputes are hardest to defend.
Keep the evidence as you go. Verification results, IP, delivery confirmation. Collecting it when a dispute arrives is too late.
Delivery and expectations
Say when it will arrive, and mean it. Most non-receipt disputes are impatience rather than non-delivery.
Use tracking, and send it to the customer. A customer who can see where their order is does not call their bank.
Describe accurately. The gap between the photograph and the thing is where not-as-described disputes live.
Communicate delays proactively. A customer told about a delay waits. A customer who hears nothing disputes.
Publish your returns policy and follow it. A policy that exists and is honoured prevents disputes; one buried in terms nobody reads does not.
Then measure. Ask your provider for your dispute ratio monthly and watch what the changes do. If disputes keep concentrating in one reason code after all this, the problem is upstream in how you sell rather than in how you handle them — and that is the useful thing to have learned.
What we charge
Interchange + 0.50% + 10¢ in person, interchange + 0.75% + 25¢ keyed, with no contract and no monthly fee.
We will tell you your current dispute ratio and help you fix your descriptor, which costs nothing and is usually the whole answer. Send us a statement and the codes you are seeing.
While we are on the subject
What is a realistic target?
Well below any published network threshold, because the thresholds are where consequences begin rather than where problems do. Your acquirer usually becomes uncomfortable long before a network does.
Does refunding a customer count against my ratio?
No. A refund is not a chargeback. That asymmetry is exactly why refunding a borderline complaint before it is disputed is almost always the cheaper outcome.
Is friendly fraud really that common?
A large share of disputes coded as fraud turn out to be customers who did not recognise the charge rather than anyone acting dishonestly. That is why the descriptor matters so much.
Do chargeback alert services work?
They can buy you time to refund before a dispute is formally filed, which has real value if your volume justifies the subscription. Fix the descriptor and the inbox first — those are free.