A DIY Approach to Mitigating Chargebacks on Shopify
Before we go into the quick hacks on how to deal with Shopify chargebacks, you might be curious to know why cardholders file Shopify
chargebacks in the first place. Here’s what we found:
● To make an extra buck or get something for nothing.
● Buyer’s remorse.
● To prevent a resupply or order handling fee.
● To avoid returning purchases.
● Forgotten purchase or unrecognized bill.
● Impatience with order delivery timelines.
● Overdue order return schedule.
● To avoid paying for a transaction by a family member.
That said, here’s how to make your chargeback mediation better.
1. Gather your compelling evidence
When a consumer files a chargeback against you, the standard process is to reach out to them and
try to understand their point of view. But if you fail to convince them to cancel the chargeback,
then you need to gather documentation that establishes the validity of the transaction, such as:
● The date and time for order fulfillment.
● The customer’s billing information.
● IP address and country used to place the order.
● Merchandise shipping and tracking information.
● If a cardholder’s relative authorized the transaction, show a connection between the order
recipient and the cardholder.
● The IP address, email address, physical address, or telephone number used in an initial
Keep the following in mind when gathering your evidence:
● Shopify accepts only PDF, JPEG, or PNG files.
● PDFs must be PDF/A compliant.
● Do not add PDF Portfolios. When required, combine multiple PDFs into a single PDF
● Each PDF must be less than 50 pages.
● Image files must be legible and cropped appropriately. Use callouts or arrows to highlight
any crucial detail.
● Evidence files must not exceed 2 MB.
● Combined evidence files must be at most 4 MB.
● Submit a maximum of one file for each evidence type. If you have several files for one
evidence type, merge them into one image or PDF file.
● Don't add audio or video files, links to external materials, or requests to call or email for
2. Respond early and tailor your Shopify chargeback response to the reason code
Each Shopify chargeback comes with a reason code, a set of numerics that helps you understand why the
cardholder initiated the chargeback. Even though chargeback reason codes don’t always show
the reason for chargebacks, it pays to tailor your response to the code you received.
How to do it:
● Go to Orders from your Shopify
● Click on the disputed transaction.
● Click Submit Response in the chargeback banner.
● Review the information about the chargeback on the Chargeback Response page.
● If you have any additional information, key it in.
● Upload your compelling evidence.
● Hit Submit Response.
3. Follow through on the status of the Shopify chargeback.
Keeping tabs on the chargeback status helps you understand which part of the process has
reached. Below are the standard states a Shopify chargeback can be in:
● Open: At this stage, Shopify hasn't sent your response yet. That means you still have the
window of opportunity to add additional documentation to your response.
● Submitted: When the chargeback reaches the ‘submitted’ stage, the card network goes
through your evidence and decides on the case.
● Won: You’ve won the case.
● Lost: You’ve lost the chargeback. You can appeal it at this stage, which restarts the cycle
again. It’s crucial to note that each chargeback can take up to 120 days to resolve.
Again, an extensive study by Javelin reported that chargeback management consumes
between 13% and 20% of a merchant’s operational budget.
Hence, automated chargeback mitigation presents a more efficient and cost-effective dispute
mitigation option for Shopify and Shopify Plus merchants.
Automate your chargebacks and recover 2x more chargebacks on
Research shows that chargeback automation gives you ~40% more ROI, but that’s before
Chargeflow built the world’s fully automated chargeback solution. Chargeflow automatically
populates dispute-related order data from Shopify to create strong evidence for your dispute –
giving you a ~75% chargeback recovery success rate.
To automate your chargebacks, you subscribe to a software-as-a-Service (SaaS) that manages
your chargebacks automatically.
The Metrics of Shopify Chargeback Automation
Chargeback automation gives you enormous benefits such as:
1. Fraud detection and mitigation
With an in-depth analysis of the cardholder's buying pattern, you can quickly track suspicious
transactions before they happen. You can equally compare the billing address to the address on
file for the payer’s account to establish the validity of transactions. That means having tools to
decline potential high-risk orders quickly and compelling evidence to dispute chargebacks better.
2. Ease of integration and workflow efficiency
Chargeback automation removes the struggle and guesswork from handling chargeback fraud.
Instead of being trapped in a rabbit hole of fighting to recover lost revenue, you have more time
to focus on growth milestones and improving your product. And with Chargeflow, you can be
sure you're not compromising the functionality of other programs you are already running or
ruining your customer experience.
3. Chargeback analytics and data enrichment
With in-depth post-chargeback analytics, you can make more informed decisions. You can
quickly see user behaviors to optimize your processes, close loopholes, forecast potential
fraudulent transactions, better manage your cash flow, and align your strategies with changing
Do it yourself or Automate your chargebacks.
Without question, handling chargebacks can be overwhelming and complicated. And if not
approached correctly, the outcomes can significantly hurt your business bottom line.
If you’re still fighting chargebacks manually, you’re leaving ungodly amounts of money on the
Using Chargeflow's automated chargeback solution for your Shopify store saves you time and
gives you flexibility and control over the entire process. Plus, you have access to data and
insights that put you on top of your customer’s buying patterns and take your chargeback win
rate to a new dimension. Find it on Shopify App Store
, alongside some other of our favourite Shopify Apps 2022