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!
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
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.
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.
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