Chargebacks & Dispute Resolution Flashcards
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Read the first 7 Chargebacks & Dispute Resolution flashcards as text
Under Visa's dispute resolution framework, what is the maximum timeframe a cardholder typically has to initiate a chargeback after the transaction processing date?
Answer: 120 days
Visa generally allows cardholders up to 120 days from the transaction processing date (or expected delivery date) to initiate a dispute.
Which chargeback reason code category covers 'Cardholder Does Not Recognize' a transaction under Mastercard's reason code framework?
Answer: Fraud
Mastercard categorizes 'Cardholder Does Not Recognize' under the Fraud reason code family (4849/4863), as it implies potential unauthorized use.
What is 'representment' in the chargeback process?
Answer: The merchant resubmitting a transaction to recover funds after a chargeback
Representment is the process by which a merchant (through their acquirer) submits compelling evidence to reverse a chargeback and recover the disputed funds.
Which party is primarily responsible for monitoring a merchant's chargeback ratio under card network rules?
Answer: The acquiring bank
The acquiring bank (acquirer) is responsible for monitoring merchant chargeback ratios and ensuring merchants comply with card network thresholds.
A merchant's Visa chargeback ratio exceeds 1% for two consecutive months. Under Visa's Dispute Monitoring Program (VDMP), which tier does this most likely trigger?
Answer: Standard threshold
Under VDMP, a chargeback ratio above 1% (with 100+ chargebacks) triggers the Standard threshold, which initiates enhanced monitoring and potential fines.
What does 'compelling evidence' refer to in the context of a chargeback representment?
Answer: Documentation that disproves the cardholder's claim or confirms transaction legitimacy
Compelling evidence is documentation (e.g., signed receipts, delivery confirmation, customer correspondence) that the merchant provides to demonstrate the transaction was valid.
Under the chargeback process, what is 'pre-arbitration' (also called 'second chargeback' in older frameworks)?
Answer: A second dispute filed after the merchant's representment is rejected by the issuer
Pre-arbitration occurs when the issuer re-asserts the dispute after reviewing the merchant's representment evidence, escalating the case before formal network arbitration.