Why is the chargeback process so frustrating and lacking transparency?

Why is the chargeback process so frustrating and lacking transparency?

4 0 3

I'm starting to have serious concerns and dissapointments with the payment procedure, specifically regarding chargebacks.


More than once, I've had a customer chargeback - which is one thing, but very limited support from shopify, massive delays before submitting appeals and feedback, and a total lack of transparency as to what has actually been discussed with the bank, how it has been presented and a lack of details pertaining to the dispute given so I Can personally follow up.


Despite twice, delivering products to customers, with tracking, confirmation from the customers and even photos of it in their care, chargebacks have been granted in the customers favour, seemingly in total ignorance of the facts.


If the banks truly did get the correct information, then it is an enormous red flag that allows a bank to decide if they are going to side with THEIR customer and Shopify's stance of washing their hands of the matter isn't really good enough. 

Frustrating and erodes my confidence in the platform massively. 



Replies 16 (16)

Shopify Staff
946 90 149

Hi @theanton 


Welcome to the Shopify Community.


Thanks for reaching out here to express your concerns about chargebacks - I can see that you have some questions about the chargeback process on Shopify. I understand that chargebacks are not a nice experience to go through, and they can certainly introduce an element of stress to managing your business.


To add some context; chargebacks are not specific to Shopify. Any website, store or platform that accepts credit cards online may need to deal with chargebacks or inquiries on occasion. They are often unavoidable and can happen on any platform.


The chargeback is initiated by the customer's bank, and Shopify simply acts as an intermediary in the transaction so to speak. Shopify is not involved in the decision making of chargeback outcomes; it ultimately entirely lies with the customers bank themselves and we cannot influence this in any way. 


However, when you receive a chargeback, you have the option to submit a response that the bank will take into consideration when making their decision. You can do this by clicking the Submit Response button on the order page in your admin. This is recommended, and you should send any details or evidence that you believe will help your case. If the order was made with Shopify Payments, then Shopify automatically collects evidence and sends it to the credit card company on the due date. To increase your chances of winning, you can also add your own additional evidence in the Shopify admin. After the evidence is submitted, the chargeback or inquiry is resolved within 120 days. We are unable to speed this process up.


I would invite you to carefully read this resource on chargebacks and how to handle them, as it explains everything in detail and will allow you to be fully informed if this ever happens again. If you are using Shopify Payments, then we have some specific chargeback information here also. In order to prevent chargebacks in the future, there are some proactive steps you can take which are outlined in this help document here.


I trust that this will help to clarify the situation, but please let me know if you have any other questions and I would be happy to help.


Rick | Shopify 
 - Was my reply helpful? Click Like to let me know! 
 - Was your question answered? Mark it as an Accepted Solution
 - To learn more visit the Shopify Help Center or the Shopify Blog

8 0 4

Hi Rick, fair enough this problem may not be specific to Shopify but Shopify should be helping vendors by at least providing the contact details for the bank involved. How can Shopify support a process which has no transparency and lacks any sort of fair justice? The worst part is that the criminals who are carrying out these fraudulent transactions are getting away with it which is only going to encourage more of this behaviour.  

1 0 1

Hi Rick,


I've read Shopify's resources and all the posts here, and I'm left with 3 questions:


1) Why does Shopify not share with sellers the name / contact info of the bank that made a chargeback decision?

2) I understand Shopify cannot help sellers challenge a chargeback decision - what other ways are there for sellers to dispute a chargeback decision?

3) Return fraud is real (the National Retail Federation estimates that 14% of all returns were fraudulent in 2023 - that's more than $100 billion in losses); isn't there a point to be made that both banks and Shopify are complicit in return fraud schemes by opaque decision making processes combined with a real conflict of interests (banks) and covering up everything (Shopify)? 




8 0 4

Couldn't agree with you more Theanton. If the bank have truly investigated these chargebacks then why are we not provided with some communication from the bank explaining the grounds considered and reasons behind the decision. Of course we know the answer is because there IS no proper process or investigation. The whole thing is clearly a smokescreen to avoid the banks having to recover money from the guilty parties. Much easier and less costly for them to hide behind this Shopify facade and penalise the innocent merchants. They dont even need to explain their decision...how good is that!

I see the normal Shopify diatribe from Rick below which of course fails to address the fundamental issues you have raised.

Also see below a response I sent today in relation to my own chargeback situation.


I have finally received notification that the banks decision is to side with the customer, which apparently means I have lost this chargeback dispute. I am the innocent party here who has been scammed by an online thief and yet the only feedback I get is "The customer’s bank sided with them". No explanation as to the basis for this decision or the grounds under which it was arrived at. No engagement or discussion whatsoever. If Shopify are going to facilitate payment for an order and then take it away from me after the goods have been shipped then surely you have an obligation to at least provide some clarity and visibility around the process and decision making. On one hand you say "Chargebacks are handled and decided upon 100% by the bank processing the payment, never by Shopify" and yet you do not provide any opportunity for the merchant to engage with the bank concerned or receive a reasonable explanation for the decision. The entire process lacks any due diligance, fairness or visibility and is a total disgrace to this industry. If challenged in court I do not believe it would stand up!

Please can you provide contact details of the bank concerned so that I can take up this decision directly with them.

4 0 3

@JaxBags - glad to hear I am not alone. 

Shopify's transactional partner for their payments is Stripe - yet the experience here is even worse than when it happens with stripe.

My response to shopify was very similar to your own and despite being told they would ask their team for info I simply got told ''I am told that the department passed your comments on'' or something to that effect.

It isn't good enough.

I want the name of the bank involved; to suggest that it is data protection to not be able to provide this information is an absolute cop-out when I have succesfully been able to negotiate when the same has happened through my bank terminal.

The fact that shopify applies the deduction to your payments account is SHOPIFY policy, not the bank. Not necesarily that I expect them to be 'holding the bag' while the dispute is worked out, but it removes any and all vested interest for any of their customers' interests (i.e. the shop owners).

Absoultely no care is taken by shopify to show that the issue is properly communicated; evidenced by the fact that you can add one photo and formatting in the response isn't retained which again erodes any confidence that my documentation has been properly communicated. I specialise in adjudications and commercial disputes and half of the effort in a succesful outcome is properly presenting it - something that shopify can't show me was done, nor does the way they gather information facilitate. 

To this date I haven't received contact details to corrsepond with the bank. The bank has a vested interest in not letting its customer down, so simply stating that 'the bank has maintained the decision' is abhorrent. 

@Rick sorry, I had actually avoided responding because once again I find shopify's answer to be completely unsatisfactory. This is the third time this has happened and it has seen me THOUSANDS out of pocket. My qualm isn't necessarily that Shopify are a 'middle man', it is that Shopify are using this position to completely extinguish any care or diligence to actually assist their customer's best interests.

For avoidance of doubt, the problems are

1) No demonstration that an adequate response has been presented to the alleged bank
2) No contact details for the bank involved have been passed on - in a role of a middle man, if you can't disclose the banks details you should be able to transparently pass through messages
3) No assistance or care for an appeals process on the back of a poor outcome
4) No evidence that my response has been passed on verbatim, edit in a way that matches the format used.
5) A Poor ability to effectively provide a response (How is the ability to upload one image sufficient?)
6) No evidence that the above is accurately portrayed to the bank - I had to create a collage of my conversations. Both times the customer claimed a fraudulent transaction - yet I provided emails where they confirmed , tracking details, photos.. and EVEN A photo and email FROM THE CUSTOMER, stating they had received the item. Yet I'm still hit with dispute fees, and a negative, generic outcome that does not match the evidence submitted. Now, either the bank is simply lying which is something that Shopify need to escalate and hold them accountable to; or the data simply wasn't transferred  and communicated clearly - which when I'm limited to attaching an A1 sized document with a collage of emails etc - is understandable - which means SHOPIFY have caused me to loose the dispute - and frankly couldn't care less.
7) Why, after I had responded within a few days to the dispute, does SHOPIFY not pass on the response until the end of their timeline?

It appears that SHOPIFY simply use their position as a middle man to wipe their hands of all care and responsibilities and it is thoroughly dissapointing.

And you know what really frustrates me? After it happened yet again, I was aghast to receive an email from shopify asking ME to justify how I would deal with future fraudulent transactions i.e. by emailing the customer to verify the transaction. I did that each time, and was ripped off not because it was a suspicious transaction; but because the customer simply wanted goods for free and my emails weren't taken on board. 

22 1 5

All I can say right now is that its really disheartening - and yes, as an Merchant, it is not only a financial drain, but emotional as well that the merchant is not secure and left with the losses.

Please let me know if my answer is helpful by clicking "Like" and marking it as a solution!

Chargeflow is the best chargeback recovery software for Shopify brands. Free to start, 24/7 Live Chat Support, ROI-guarantee and the highest win-rates. Let us take care of your chargebacks.

8 0 4

Where is the response from Shopify on this? What is going to be done about the issues raised?

4 0 3

I would also like a reply. 

As of today it is literally happening again. I verified a transaction, and I Can almost tell you the play by play. 

I delivered the products by hand, after liasing with the customer and he even confirmed he would cancel the chargeback. 

He is now ignoring my texts.

I will respond to the chargeback, barely able to add sufficient detail due to the ridiculously scarce interface.

I will get no support or confirmation from shopify.

The bank will mysteriously ignore the response, adding to my doubts that shopify are accurately passing on the information. 

I will likely get some sort of email, blaming ME for not verifying the transaction


I remain $500 out of pocket once again, receive no feedback and no assistance.


It is truly getting depressing. 

1 0 0

Shopify is not on the side of sellers. My chargeback was filed January. Shopify waited until march 23 to submit the response. the buyer of course got to keep the product as the chargeback was resolved in their favor. as soon as something comes along that's better im moving on. crappy. also the fact that they still get to keep the transaction fee while we have to pay 15 dollars chargeback fee they are crappy. will never support this company. i hope they die a painful death on wallstreet. 

4 0 3

Well, well, well. here's a surprise.

The last chargeback has been lost. Despite showing a photo of me dropping the package off at the buyer's house, emails from the buyer stating he'd cancel the chargeback and more.


Shopify simply states ''the bank sided with them''

Of course THEIR bank sided with THEIR customer - where's your support shopify?

No line of contact provided to their bank - I bet if it turned out it was the same bank I bank with they'd change their tune.

No evidence of exactly what eveidence was submitted on my behalf. 

The tally of lost (STOLEN) money that shopify have done nothing to stem now reaches around $5k. 

8 0 4

Sorry to hear that Theanton.....just a terrible situation. Regardless of whether this issue is specific to Shopify or industry wide it is blatantly wrong and something needs to be done about it. The way I see it the banks are actually helping their customers perform fraudulent purchases and keep goods without paying. The worst part is that the criminals who are carrying out these fraudulent transactions are getting away with it which is only going to encourage more of this behaviour. This is wrong....keep fighting it!

9 0 1

I had the same issue. The Item was delivered 3 days after purchase which Shop Pay should protect. They just excluded my protection from the chargeback. I provided photos of the customer using the product, emails, and return policy, not to mention a return label never scanned, and I still lost the claim. I also called Visa and shop pay, and they told me they couldn't help. How come we don't have the option to challenge the decision? This is frustrating.  

1 0 1

I refunded a customer their order and they still were able to file a chargeback on the order. They received a refund from us twice. I provided all evidence of the refund and still nothing. I'm fully convinced the banks don't even look at the merchant responses. I don't understand how the customer's bank can be the ultimate authority on the legitimacy of the purchase. @Shopify how is this legal?

2 0 0

A customer ordered 16 items from us. Total value over $7,000. They Claimed the items were not received. We provided full proof of delivery for each item, supporting evidence from the mail carriers clearing stating they were delivered. But still the chargeback goes in the customers favor? Of course their financial institution would side with them even with this compelling evidence??? How is there no escalation or opportunity to appeal this ridiculous decision??? 

2 0 0

To add, the customer used Shopify payments for this transaction, so there is even greater reason why Shopify should be able to provide additional support to merchants. So why are we in this position of loss for goods and services that were rendered as expected? 

36 0 12

This happens to us A LOT!
Even when clear proof is presented the credit card companies side with the customer and that's it. This is totally unacceptable.
It would be great if someone from Shopify can comment about this.
I think direct verbal communication with the credit card company handling the chargeback claim would help a lot.
Thank you