Handle chargebacks

Chargebacks are returns that levy a fee. The bank that issued the credit card initiates a refund to the cardholder. The cardholder signs an affidavit with the credit card company claiming that they did not make the purchase. 

As the Merchant of Record, FastSpring is responsible for keeping fraud rates and chargebacks under specific thresholds set by card networks.

Impact on Customers: If a chargeback occurs, FastSpring may block the associated credit card number for 90 days to prevent further fraudulent activity.

PayPal disputes, claims, and reversals

PayPal manages disputes differently from standard credit card chargebacks. If there is an open case with PayPal regarding a transaction within the last 72 hours, FastSpring will inform your company and provide 48 hours to resolve the issue.

If the issue is not resolved within that window, we may issue a refund to prevent additional escalation.

PayPal case types

PayPal classifies transaction issues into the following categories, each with specific resolution timelines and requirements:

• Chargebacks: Occurs when a customer contacts their issuing bank, and the bank initiates a chargeback. The issuing bank returns the full amount to the customer and charges a fee for the chargeback.

• Disputes: Occurs when a PayPal customer expresses dissatisfaction or does not recognize the charge. You or FastSpring have 20 days to resolve the customer’s dispute and prove the transaction was legitimate (e.g., invoices, receipts, delivery logs).

• Claims: Occurs after a dispute is escalated. You or FastSpring must respond with proof of purchase, usage, or successful product delivery within 10 days. Neither you nor FastSpring are allowed to communicate with the customer during this phase.

• Reversals: Indicates that PayPal has returned the funds to the customer, but they did not apply a chargeback fee.