We understand that sometimes there can be confusion regarding the terms "refund" and "chargeback". In this help article, we explain the difference between these two terms to help clarify payment transactions.
The refund
A refund occurs when a customer has requested reimbursement and CopeCart or the vendor has sent the funds back, and this decision is irreversible.
It usually takes up to 10 days for the funds to be returned to the cardholder's account, depending on their bank.
The chargeback
A chargeback, (or return debit note) indicates that the customer opened a dispute and the bank or Paypal has temporarily held the funds, and we are not able to access them until the dispute is resolved. Following the submission of evidence to the bank, they will review the case, and a decision may take up to 180 days. Unfortunate as it is, this is standard procedure.
When we receive a dispute, our Support team will reach out to the vendor via email address and will ask them for the evidence necessary to solve this dispute with the bank's cardholder.
Reasons for a refund request or chargeback
There could be several reasons why a customer may choose to file a dispute. These are some common ones to consider:
- Fraud
- Unauthorized charge
- Product/service not as described/unacceptable
- Product/service not received
- Duplicate charge
We hope this brief introduction will help you better understand the difference between a refund and a chargeback. Feel free to read on for more detailed information on the specific scenarios and procedures related to refunds and chargebacks.
Chargebacks for vendors
How are chargebacks handled at CopeCart?
All payments at CopeCart (including fees) are handled in two stages: 80% of the amount is processed on the 14th day, and the remaining 20%—on the 40th day.
Example:
The chargeback dispute for $100 was settled on October 1. On October 14, 80% of $100 plus 80% of the chargeback fee is charged by the seller:
(80 % × $100) + (80 % × $40) = $80 + $32 = $112.
The 40th day after the chargeback is resolved is November 10, and then the remaining 20% of the chargeback plus 20% of the chargeback fee is deducted by the seller:
(20 % × $100) + (20 % × $40) = $20 + $8 = $28.
FAQ
What are the fees for chargebacks?
It depends on the payment service provider.
How often do chargebacks occur?
They are very rare. Almost all occurring requests of buyers are met with refunds.
How can I avoid a chargeback?
Be clear in your T&C so your customers are aware of the refund policy
Offering a 14 or 30 days refund
Deliver the product or service on time and ensure that the quality delivers what was expected.
For further questions, please feel free to contact our support team.
Best regards
Your CopeCart Team