Shopify holding $7,555.50 funds from a REFUND and CHARGEBACK!!!!!

Cecatroambuilt
Visitor
2 0 0

PLEASE HELP!!!!  Shopify is WRONGFULLY holding money from a Refunded order that also received a Chargeback.  We were late delivering a product to a customer (production/fabrication issues).  The customer requested a refund, we gladly agreed and issued a full Refund of $7,555.50 for the late and undelivered product.  Customer was notified by email. 3 hours later we received a Chargeback for $7,555.51 plus the $15 Chargeback fee.   The 1 cent we did not refund was the shipping cost (which is another total frustration with Shopify not allowing this line to be $0).  Shopify Support stated that because it was not a FULL refund, there could be a Chargeback.  Support said that I have to wait for the full process of the customers bank to decide the status of the Chargeback.  I am totally OK refunding the customer's $7555.51.  However, we are currently out an additional $7,555.50. Shopify Support is of no help whatsoever - just saying that if the Chargeback rules in customer's favor we can I can submit a "Good Faith Collections Request that is time consuming and not always successful" to get my $7,555.50 back. Any Advice?  Thanks!

Replies 5 (5)

Ren
Shopify Staff (Retired)
1032 66 153

Hey, @Cecatroambuilt 

I am so sorry to hear about this happening. I can absolutely relate and understand how frustrating a situation like this is. 

I just want to reassure you that when you respond to the chargeback, if you can provide very solid and clear proof of you refunding the customer, this can work in your favour and doing so will be helpful to your case.

It's very possible that the customer also got ahead of themselves and called their bank without realizing that you'd quickly and gladly agree to issue a refund.

Have you tried contacting the customer about this?. The fastest resolution is going to be through the customer calling their bank back and cancelling the chargeback.

I would advise trying this first, if you can't get them to agree to do this or aren't able to reach the customer, then you'll need to respond to the chargeback with all of the evidence of your communication and refund to the customer. 

Moving forward, I recommend looking into chargeback protection with Shop Pay and/or considering fraud protection apps that can help you avoid this in the future.

If there is anything else I can help with or clarify any of the above, please let me know! Best of luck.

To learn more visit the Shopify Help Center or the Community Blog.

Cecatroambuilt
Visitor
2 0 0

Ren (Shopify Staff),

 

Your last sentence ......"If there is anything else I can help with" is a blatant and arrogant assumption that your response was helpful.  It was not.  Followed by a "Best of Luck"!  Really?                                    Shopify is withholding $7,555.50 of my money and your response is Oh, good luck with that! C'mon Shopify step up and do the right thing!

Ren
Shopify Staff (Retired)
1032 66 153

I truly understand your frustration and recognize that there is a substantial amount of money involved with this erroneous chargeback - there is a lot of stress involved in these circumstances. 

Have you had an opportunity to contact the customer? Do you need any further support in putting together a response to the chargeback? 

For clarity, Shopify doesn't play a role in these decisions and the funds are held in reserve due to the bank. This blog goes into more detail about what chargebacks are and how the process works.

I've included a guideline below of the evidence you can collect for your response: 

If the cardholder collected merchandise from your physical storefront/location, include:

  • Cardholder signature on the pick-up form
  • Copy of identification presented by the cardholder
  • Details of identification presented by the cardholder

If the merchandise was delivered to the cardholder’s address, include:

  • Evidence of delivery date and time
  • Proof that the item was delivered to the same address

If the merchandise was delivered to the cardholder’s business address, include:

  • Evidence that the merchandise was delivered
  • Proof that the cardholder was working at the address at the time of delivery

The link above has a wealth of information, I highly recommend reading it over. If I can clarify anything further please let me know.

 

To learn more visit the Shopify Help Center or the Community Blog.

ForeverRedSoles
Visitor
2 0 0

This is exactly my situation right now with a $7000 chargeback. I refunded the order within 24 hours after it was received because I knew it was a fraudulent order after doing a lot of research. I didn’t refund the credit card fee because I incorrectly thought Shopify covers those fees (which was about $200). Shopify has been no help at all. Basically have to wait 2 months for the bank to review the case. I’ve never seen something so ridiculous. No idea how the bank doesn’t see the refund right after the purchase and just give back the customer the $200.

There are definitely loopholes in the whole chargeback process. 

ForeverRedSoles
Visitor
2 0 0

Can you also keep me posted what the result of your chargeback is? I would like to find someone else in our boat and see if they were refunded or not. I am hoping in our favour!