How can I resolve locked funds after chargebacks on my payment system?

[youthoodfink]

So I got the sad message that my shop has too many chargebacks, (which I can not even control, it is people trying to scam my business), but Shopify said I can not use Shopify payments anymore, $3.5k is being held until February 2024. Very frustrating, but even more frustrating since my account is on hold I still have money in my balance and it will not let me transfer to another payment system until I get that money out but I can't get the money out because it is locked. So it just makes no sense, Shopify does not want me to use payments but they wont release the lock so that I can transfer???  Now people can only checckout using paypal or venmo, this seems ridiculous, I have contacted everyone it just drags out more and more I just want actual help, this is my life and business. 

[Shay]

Hi @youthoodfink 

I am sorry to hear that your business has been deemed not a good fit for Shopify Payments. That is never a great situation to be in, and I fully recognize the impact this can have based on the shopping season we are entering right now. 

In regards to your payouts and balance being held in reserve, this is something that is put in place by the banking institutes that power Shopify Payments to help mitigate chargeback risk through the banks. Holding the money in reserve means that if there is any additional chargebacks resolved in the customer's favor, the chargeback refund will first be taken out of the reserve funds being held. Once the reserve is over all remaining funds will be released back to you. 

You can review available third party gateways based on your business location here: Payment Providers and Online Payment Gateways (2023). I recommend connecting with Authorize.net, Checkout.com and 2checkout to see if they will be a good fit for your store. 

I would also be interested in knowing some more about the orders you received that ended up in chargebacks. What was the reason the customer provided for the chargeback and what kind of information were you able to send in response? Mitigating orders that could lead to a chargeback, as well as improving your response to chargebacks, can help you with your future gateways. 

Shopify Help Center | Preventing chargebacks 

[stylesbystella]

I had my account suspended and them terminated back in July 2023 and my funds put on reserve until Nov. 16th. In that time I had zero chargebacks or any issues. Still don't even know why my account was terminated as nobody will ever talk to you. Nov. 16th came and I was told it would take 2-3 days for my funds to release and today is 12/7/2023 and they still are not released. I can't login to my old account, I can't use my shopify cards cause they are locked and I can't move my funds on the app as it says they are locked. This is not legal per everything I was given by Shopify legal team. You were able to hold the funds for that 120 days incase of chargebacks and issues and there were NONE, so now I want my money back!!

[stylesbystella]

Good luck with this and I feel so bad for you with that much held. Mine is only $623.59 and was to be released on Nov. 16th and as of today Dec. 7 it still is not released and nobody from shopify responds and the 24/7 chat tells you to use your ticket number with Legal, but they never answer you. It's getting to the point of reaching out to a legal team myself. 

[Godislove]

Hi! I am in the same boat with ~$600 currently being held. Did they end up releasing the funds to you or are you still waiting?

[indi555]

Any update? currently they duplicated my reserve fund transactions with negative and positive amounts to cancel it out to net $0
Kinda seems like a class action lawsuit