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Handle chargebacks and retrieval requests for QuickBooks Payments
by Intuit• Updated 1 month ago
Learn what a chargeback is and what to do if you get one.
A chargeback is when a transaction you processed gets disputed and the money goes back to the payer. In other words, the sale is "charged back" to you.
Sometimes a retrieval request will come before a chargeback. A retrieval request is a request from the card-issuing bank for documentation about the sale. A common reason for a retrieval request is that the cardholder doesn't recognize the charge.
Chargebacks can happen for a variety of reasons. They may be the result of a mistake, fraud, or an unhappy customer. If you don't handle them properly, they can cost you time and money. Here’s what to do if you get a chargeback for a payment you processed with QuickBooks Payments (Merchant Services).
- Step 1: What to do when you get a chargeback
- Step 2: How to respond
- Step 3: Talk to customers during the process
- Step 4: Follow up on your rebuttal
- Frequently asked questions about chargebacks and rebuttals
Important: If you receive a chargeback, don't issue a credit to the cardholder’s (your customer’s) card or any other type of refund, such as cheque or cash. We'll show you how to handle everything properly.
If there was a chargeback on your account with Quickbooks, it’s important to note the below:
General chargeback rules
- When signing up with Intuit Payments and accepting the terms and conditions, you are authorizing Intuit to debit your account for disputes, fees or any amount owed to Intuit.
- Judgment in disputes is handled by the card-issuing bank and in the event the case is lost, the merchant is responsible for the balance due.
- When Intuit attempts to collect a chargeback and the merchant refuses to pay, the outcome is then explained to a third-party agency. Once outsourced, the merchant is responsible to pay the third-party agency along with any additional fees that are added by the agency.
- All details are covered on the QuickBooks Online Terms of Service page in the merchant payment services section under Product Specific Terms, which you can find here.
Step 1: What to do when you get a chargeback
When a customer disputes a charge with their bank or credit card company, the financial institution notifies QuickBooks Payments.
QuickBooks checks for credits to the card when the chargeback is received. There are cases when we can't match the chargeback to the credit:
- If the sale and refund amounts are different.
- If you (the merchant) issue a credit to the card after the chargeback has already been posted to your account. If this happens, send a copy of the credit issued to the card or proof that a refund was given, such as the front and back copy of the cashed refund cheque.
- If you issue a refund outside your QuickBooks Payments. If this happens, send proof of that payment to us.
If you didn't give a credit, or we can't match the credit to the chargeback, the customer's card issuer credits the original charge amount to the cardholder. The credited amount, plus a $25 fee, is then debited to you, the merchant. This fee isn't a penalty. It's used to cover related costs.
When this happens, we'll email you about chargeback notices or retrieval requests. Don't worry, the email will give you clear instructions for what to do next.
Step 2: How to respond
Always follow the instructions in the email we send you. Here are general guidelines for what to do if you get a chargeback notice or a retrieval request:
Respond to a retrieval request
You may receive just a retrieval request, or a retrieval request may come in before a chargeback. Usually, this means the cardholder doesn't recognize the charge and needs more info about it.
If this happens, we'll let you know and email you the following details about the transaction in question. Use these details to find the original charge in your records:
- First 4 and last 4 digits of the credit card
- Transaction date
- Transaction amount
- Retrieval request reason
- Respond by date
- QuickBooks Payments case number
Note: These are the only details provided by the card issuer.
Follow the instructions in the email to send the signed merchant copy of the credit card receipt. The merchant copy is also known as the sales draft. The credit card issuer (your customer's credit card company) needs a copy of the sales draft to review.
Send the sales draft by the deadline specified in the email to avoid a chargeback.
Tip: Card Associations require merchants to keep sales drafts, on or off premises, for 3 years.
Respond to a chargeback
As a merchant, you may have an option to respond to a chargeback. This response is known as a rebuttal.
Note: You won't have this option if a retrieval request came in before the chargeback and you didn't respond to the retrieval request by the deadline.
We'll email you instructions and deadlines if you get a chargeback or retrieval notice. We include the case number, email address, fax number, and how to send your response.
We want you to be able to tell your side of the dispute. We require you to reply with a letter that directly responds to the reason for the cardholder’s dispute.
Based on the reason for the chargeback, you may also want to provide supporting documentation to back up your rebuttal letter. If you email your documentation to us, use PDF format so we get the best quality images.
Chargeback reason | Supporting documents(s) |
Cardholder claims they didn't get the merchandise or services | Proof of delivery or signed pick-up. |
Cardholder claims the merchandise or services received weren't as described or defective | Proof the merchandise or services matched the description. Proof the cardholder didn't attempt to return the merchandise. Proof of ongoing negotiations between the cardholder and the merchant. Outside opinion from a third-party expert in support of the merchant's rebuttal. |
Cardholder claims fraud or unauthorized charge | A copy of the signed receipt (if applicable). Compelling evidence (like photographs, emails, etc.), to support the cardholder made the transaction and received the merchandise or service. |
Cardholder claims there's a duplicate transaction | Proof the cardholder engaged in 2 separate transactions. |
Note: There are page limits for merchant responses set by the card associations. MasterCard is 15 pages, Visa is 21 pages, Discover is 2 pages, and American Express is 50 pages.
Once we get your documents, we will send you an email confirmation within 1- 2 business days.
Step 3: Talk to customers during the process
Keep trying to resolve any issues your customer may have. Keep records of these interactions. If they feel you’ve resolved the situation, ask them to write you a letter stating that, and send it with your documents as described in Step 2. The customer should also contact their card issuing bank to cancel the chargeback.
If your customer tells you they cancelled the chargeback, request a copy of the letter of retraction their bank provides. It should be on the bank’s letterhead, and state the dispute has been dropped or resolved in the merchant’s favour. Send the letter to us as part of your supporting documentation.
Step 4: Follow up on your rebuttal
Once you send your documents, it can take up to 90 days for the card issuer to reach a decision. We'll send you a decision letter by email.
If the issuing bank decides you can't dispute the chargeback, you’ll receive a no-recourse notice that explains why.
The bank makes its decision based on the evidence presented by both you (the merchant) and your customer (the cardholder).
Frequently asked questions about chargebacks and rebuttals
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