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Disputes

Dispute (also known as Chargeback) as the name suggests is a disagreement against a particular transaction initiated by the end consumer, who has paid for the product or service. End customer raises a dispute with his/her issuing bank. It is a service provided by the issuing bank/ card network to protect customers from unauthorized and fraudulent transactions.
 

 

Disputes generally occur due to displeasing customer experience originating from:

  • Poor product/service quality
  • Delivery or refund/returns issue from the merchant side
  • A fraudulent transaction will also attract a dispute from the customer’s end

 

Whenever a customer raises a dispute, we get notified to facilitate the investigation further. Till the time a transaction is under dispute, refunds against that transaction are prohibited. 
 

 

Paytm’s Chargeback system allocates a proper Dispute ID to an incoming chargeback.

  • Merchants are notified using emails/S2S notifications based on the creation of a new dispute against a transaction
  • Merchants can accept/defend and manage the entire lifecycle of the dispute through Paytm Dashboard i.e. UMP or by using Dispute Action API
  • The complete lifecycle of a dispute is visible to the merchant on the merchant dashboard
  • Disputes are currently raised for Credit Card, Debit Card, and UPI transactions only

Demo

The demo video below shows the lifecycle of a dispute on the Paytm Dashboard.

 

Overview

The image below shows the status of a dispute during its lifecycle.

  1. End customer contacts his/her issuing bank to file a dispute.
  2. Paytm gets this dispute through the acquiring bank.
  3. Paytm creates a Dispute ID and notifies the merchant through email/S2S notification.
  4. Merchant logins to Paytm Dashboard to see all the pending disputes.
  5. Merchant uploads proof(s) against the NEW dispute ID within the due date or accepts the dispute straight away.
  6. Once the documents are submitted, the dispute’s status changes to POD_UPLOAD. 
  7. Paytm reviews the documents provided by a merchant, if documents are not found to be satisfactory then the dispute will be marked as POD_REJECT. 
  8. Merchant should quickly respond with correct documents within the due date, dispute will again reach POD UPLOAD status. 
  9. Based on the proof(s) submitted, the Paytm ops team checks and upon satisfaction shares the proofs with the bank and marks the dispute as WON. This dispute is liable to be challenged up to two more times by the customer/ bank in case any inconsistency is found with the proofs submitted. No debit happens if the dispute is marked as WON. 
  10. If the merchant does not respond to a dispute or fails to provide appropriate proof(s) within the due date, the dispute will be marked as LOST.
  11. Every lost dispute will invite a debit equal to the disputed amount. 
  12. Debit against any lost dispute will be settled with the merchant's upcoming settlement as per the merchant’s settlement cycle.

How to share proofs against a Dispute ID?

There are 2 ways in which a merchant can share proofs against a dispute ID.

 

When Dispute is to be Accepted

  1. A new dispute is created, it is visible on the Dashboard in the Disputes tab.
    At the same time, Paytm sends an email to Merchant with dispute details.
  2. Merchant chooses to Accept the dispute.
  3. Merchant shares acceptance by clicking the Respond button and selecting the Accept option for that Dispute ID on the Dashboard.
  4. Paytm receives the request and marks the Dispute as LOST.
  5. Dispute moves to LOST status on the panel.
    Paytm sends an email about the LOST status of a dispute to the merchant.
  6. Under the LOST sub-tab, once the dispute is settled, the merchant is informed about the UTR details of a settled dispute.
    Once the lost dispute is settled, Paytm sends an email with UTR details to the merchant.

 

When Dispute is to be Defended

  1. A dispute is created, it's visible on the Dashboard instantly.
    At the same time, Paytm sends an email to Merchant with dispute details.
  2. Merchant chooses to defend the Dispute.
  3. Merchant uploads the proofs through the Disputes tab for that Dispute ID within the due date on the Dashboard.
  4. Paytm changes the status of the dispute to POD UPLOADED and sends an email to the merchant.
    Dashboard shows the dispute in POD UPLOADED status.
  5. Paytm Ops team checks the documents and upon approval moves the status of the Dispute to WON status.
  6. Paytm sends an email to the merchant with status as WON against that DIspute ID.
    Dashboard will reflect the dispute in the WON sub-tab in the Dashboard.

 

Flow diagram to show how a merchant can share proofs against a dispute ID.

When Dispute is to be Accepted

  1. A new dispute is created, Paytm sends an S2S notification to Merchant.
  2. Merchant chooses to Accept the dispute.
  3. Merchant shares Acceptance through Dispute Action API within the due date.
  4. Paytm receives the request and marks the Dispute as LOST.
  5. Paytm responds with LOST status to the merchant as a response to the API request.
    Paytm sends a notification with LOST status to the merchant.
  6. Paytm sends Dispute settled notification with UTR details to the merchant.

 

When Dispute is to be Defended

  1. A new dispute is created, Paytm sends an S2S notification to the merchant.
  2. Merchant wants to defend the dispute.
  3. Merchant shares the proofs through Dispute Action API through files/ SFTP option.
  4. Paytm receives the files. For the files sharing option, API sends an instant response as UPLOADED SUCCESS. For the SFTP option, it sends ACCEPTED SUCCESS instantly. And shares UPLOADED SUCCESS in an async fashion. The Dispute is in POD UPLOADED status now.
    Paytm Webhook sends a notification to Merchant with POD UPLOADED status.
  5. Paytm Ops team checks the documents and upon approval moves the status of the Dispute to WON status.
  6. Paytm Webhook sends a notification to Merchant with WON status.

Flow diagram to show how a merchant can share proofs against a dispute ID.

Note:
  1. Dispute webhook will inform about each status change thereafter as well. It will also share notification for dispute’s settlement with UTR.
  2. Dispute Status API can be additionally integrated to fetch the status of any dispute at any point of time.

Prerequisites

  • A merchant should have access to the Paytm dashboard (web)
  • To share proofs in the S2S manner, the merchant needs to integrate Dispute Action API, Dispute Webhook, and Dispute Status API
  • To share proofs through Dispute Action API, the merchant needs to share the following:
    • One time SFTP credentials (for SFTP option)
    • Two callback URLs (one for API and the other for webhook)

Steps to process a dispute

  1. Check for new disputes and then accept or defend a dispute within the due date.
  2. Check for debit entries in the settlement cycle for lost disputes.
Note: To know about the FAQs related to disputes, click here.