Handle credit card disputes

How credit card disputes are resolved

Updated this week

When you accept credit card payments, your client may dispute the charge or not recognize it with their bank. In these cases, the client can ask their bank to reverse the charge, which is called a payment dispute or chargeback.

The banks that issues the client's credit card is responsible for managing the dispute process, and determining the appropriate outcome. In some instances where a client has transacted through the HoneyBook payment system, HoneyBook's Disputes Resolution Team can help you present your case to the bank.


Reviewing a dispute

When a client initiates a dispute:

  • HoneyBook notifies you of the dispute

  • The disputed amount is withheld from future payments

  • The client's bank will take back the disputed amount from HoneyBook on behalf of the client

    • Future payments may also be used to cover the disputed amount if the bank can't take back the funds

  • The bank contacts HoneyBook for more information about the transaction

How the disputed amount is withheld

The bank needs to recover funds for the client as soon as the dispute is started, the disputed amount (plus a $10 dispute fee) will be taken from your linked bank account. This is done by your client's bank, and the funds will be held until the dispute is resolved. Resolutions can take 60–90 days. If the dispute is resolved in your favor, all the held funds will be returned to you.

If the bank can't take the funds from your account for any reason, future client payments will be used to settle the dispute. Again, if the dispute is resolved in your favor, all funds will be returned to you.

How the bank asks for information about the transaction

Based on the details of the dispute provided by the bank, HoneyBook will reach out to you to get more information about the situation. The email you receive will include all the known information about the dispute, as well as what information the client's bank needs from you.

HoneyBook's goal is to support you in dealing with the dispute. The information you provide will help in contesting the dispute. HoneyBook may contact you again if there's a chance the bank needs more information.

πŸ“š Tip

The bank gives a short time frame to submit your information, so it's best to respond as soon as you can with the requested information. This is covered in the next section.


You send HoneyBook the necessary documents

If you want to challenge the dispute, you'll need to respond with any relevant documents you have that can verify the purchase and the products/services provided. The bank will look for evidence about the transaction to prove its validity, like receipts, invoices, email conversations, proof of delivery, photos, etc.

The documents you submit should directly contradict the client's claims. For example, just a signed receipt won't be enough to challenge a dispute where the client claims they didn't receive the goods. The bank would need to see proof of delivery as well. The more evidence you provide, the better.

πŸ“£ Note

The bank gives a short time frame to submit your information. If you can't submit it within that time, HoneyBook will have to respond to the dispute using the information already available, such as invoices and contracts sent through HoneyBook.

In the dispute email you receive, carefully read the details of the dispute, paying attention to what your client is claiming (including the reason and the amount disputed). This will help you identify which transaction is being disputed and which supporting evidence to submit. To submit your evidence, respond using the form in the email.

Once you've sent in your evidence, HoneyBook will pass the information to your client's bank.


Everyone waits for the bank to make a decision

Once you submit your information, HoneyBook forwards it to your client's bank. The bank will review the case, and it may take 60-90 days for them to determine an outcome. HoneyBook will notify you by email as soon as the bank reaches a decision.

If the bank resolves the case in your client's favor, your client will receive the funds back on their credit card. When the bank makes a decision, it's final. Here are the potential dispute outcomes:

Outcome

Next steps

Dispute resolved in favor of the business

If the dispute is resolved in your favor, there's no further action for you to take.

  • HoneyBook will inform you the dispute has been closed

  • The withdrawn funds (including the $10 dispute fee) will be deposited back into your linked bank account

Dispute resolved in favor of the client

If the dispute is resolved in your client's favor:

  • HoneyBook will inform you the dispute has been closed

  • The funds that were withdrawn from your linked bank account

    • This includes the disputed amount (minus the transaction fee) plus a $10 dispute fee

  • The funds will be refunded to the client

You don't need to take any further action.

Still have questions? Feel free to send us a message by clicking the Question Mark icon on any HoneyBook page. Our team is always happy to help!

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