Furious! Shopify accepts a chargeback on an already refunded item

Furious! Shopify accepts a chargeback on an already refunded item

shopfy-2020
Shopify Partner
85 3 35

We have an incident where an Arabian customer issued a street address which cannot be delivered to. Orders in this country can only be delivered to PO Boxes. They will not deliver to street addressed.

Consequently, the customer did not receive their order. We issued a refund to the customer. Despite this Shopify APPROVED a chargeback! This meant DOUBLE has been charged from us than the actual transaction. This chargeback then went to the customers Arab bank, who APPROVED of the double charges. So, the customer not only received her money back but she made a profit from us.

 

How on earth can Shopify participate in this type of blatant fraud? We don't even have details what bank the buyer has used to be able to contact the bank.

I am absolutely furious!

 

Replies 7 (7)

JoesIdeas
Shopify Partner
2476 228 667

The chargeback is a separate action from order management. I would recommend 2 things here:

 

1) Contact the customer and explain the situation, ask them to contact their bank to correct the mistake. Most people are genuinely good people, ask them nicely and explain the situation, work with them to see if there's another way you can get your product to them (they purchased from you so want the product).

 

2) Create a standard operating procedure for things like this in the future. If there is a chargeback in progress, do not refund the money until the chargeback request has finished (usually you would ask the customer to drop the chargeback, tell them that you are going to refund the order).

 

If you happen to refund an order that has a chargeback pending, you would want to submit that as information in the case so that the chargeback would be not approved.

 

I know chargebacks are a pain, I dealt with them for years. The best thing you can do is create a clear system of action to prevent chargebacks from happening in the first place. If you want some tips in that area, here's a guide I wrote: How to Deal with Fraudulent Orders and Minimize Chargebacks on Shopify

 

• Creator of Order Automator [auto tag, fulfill, connect FBA, daily jobs]
• Co-Creator of Product Automator [suite of features for products / collections]
• Shopify developer for 10+ years, store owner for 7 years
• Blog: Shopify Tips, Guides, and Automation Tactics
shopfy-2020
Shopify Partner
85 3 35

Obviously you didn't read the post. As mentioned, she already got a refund yet Shopify still allowed a chargeback - and three months of wasted time.

Victor
Shopify Staff
2611 236 565

Hi @shopfy-2020,

 

Thank you for your post and I am sorry to hear that this happened to you. Chargebacks are an unfortunately common part of selling online and there are occasions where you lose chargebacks when you feel like you should not have done. I'd recommend following the advice @JoesIdeas has listed below with regards to preventing them in future, and checking out our Help Center page on chargeback prevention.

 

Please note that in these situations, Shopify has no say in the final decision. The customer's bank can open a chargeback against a merchant and they are the ultimate decision-makers in this process. Shopify will notify you when a chargeback has been opened against you, provide you with the opportunity to submit a counter response, and will notify you of the decision when it is made. We cannot choose to whether to approve or reject a chargeback.

 

I know this is a frustrating situation and I hope this does not happen to you again. I would recommend contacting your bank and explaining the situation to them and asking them if there's anything they can do from their end.

Victor | Social Care @ Shopify 
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shopfy-2020
Shopify Partner
85 3 35

Your reply doesn't make any sense. A chargeback should NOT be processed when a refund has already been issued. That's completely illogical. And how am I supposed to contact "my bank" when it's Shopify that process the payment and not my bank? What bank am I supposed to contact?

If I return an item to the store, should I be able to demand a second refund so I make a profit out of the return??

 

ccarrigan
Tourist
4 0 2

Just adding that this is not isolated, and happened to my business today as well.  There is no reason this should be allowed to happen, and now we need to try and submit evidence to not loose the entire order value again.  This should be submitted as a bug in this platform.

urbanelectrica
Visitor
1 0 0

We are dealing with something very similar now for 3 weeks. We issued a refund to the customer, then 1 day later they did a charge back. It has caused our account to freeze all refund's and they wont let us refund anyone money now until the refund fails according to support but it beens 3 weeks and it still hasn't failed. other customers are getting upset because we cant refund a order. Were you able to get it fixed and worked out? If so how long did it take.

 

ccarrigan
Tourist
4 0 2

Only very recently the chargeback was reviewed in our favor and the funds were returned.  Shopify provided no support, it was simply a plea to the bank via the normal process that the bank sided in favor of us.