#Dan (ClassFit)-disputes

1 messages · Page 1 of 1 (latest)

twin marlin
thick star
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we can talk here

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(thread was archived because you didn't reply for an hour and we need to keep the number of open threads manageable on our side)

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In short, if our client's client, disputes a fee charged by our client, I understand Stripe's policy is we are responsible for it. However we will be passing this fee onto our client as is industry standard. Right now we can do this but only manually - as we grow this will become unwieldy and we'd like to automate the process - is this possible?

toxic zenith
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Ah, sorry I was on a client demo when the response came

thick star
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if you're using Destination charges and the end-customer disputes a payment, the platform is liable for that yes. Is that how you integrate?

toxic zenith
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We have a Stripe Express integration

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So in our scenario, a merchant (yoga teacher) and their client are in a dispute about whether a payment was legitimate. We've had 4 disputes so far, in each the client has written in and said they made the claim by mistake - we've still lost all 4. So moving forward we will do as is industry standard and pass on any fees incurred by Stripe to our merchants. This is a manual task at present, but as we scale I'd like to know if this is something we can automate.

  • stripe dispute is opened.
  • We send email to client and debit appropriate fees
  • Client can respond with evidence if they choose to in which case we will manually upload this for them.
thick star
toxic zenith
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Yes I believe so

thick star
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if you want to automate this the options are :

  • listen to the appropriate webhooks for disputes
  • reverse the transfer from the Destination charge so you pull the funds back from the connected account to your platform to help you cover the negative balance https://stripe.com/docs/api/transfer_reversals
  • for the $15 dispute fee itself, either look into doing an AccountDebit (https://stripe.com/docs/connect/account-debits) on the connected account, or add some logic so you take a larger application fee on future payments with that Express account to recoup it over time
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my actual advice though would be to not do this, instead, disputes are a cost of doing business and you should factor that into your pricing an thus take an application fee on your payments that allows to make a profit while also covering an expected number of disputes

toxic zenith
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Our fees are 2%. This can vary from 2c per month to $100 per month. We can't take on a $25 fee from a customer who will take 100 years to pay that back.

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If we were charging a fixed monthly fee it would be easier, but our flexible pricing is one of our main USPs

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also, pretty much all of our competitors to the exact same thing as I'm suggesting.

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It makes sense.

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If your clients, has said that they didn't recognise your name on their bank account - this dispute is between you two, and should be factored into their cost of business not ours.

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They are also the only ones in a position to do anything about it. Their customers may respond to them, and get a note from their bank for the people they see on a weekly basis - they won't do it for a company they barely recognise exists...

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So this is quite a backward situation in our industry, albeit I understand it may work well for most of your clients.

thick star
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I see. I help with API/technical questions, to be clear, this is a chat for developers, let me know if I can help! Overall it's possible to charge the Express account holder for the dispute. Options are :

  • account debits + reversing the transfer
  • making adjustments to the application fee
  • you could separately collect a card or other payment method from the account holder, save that to a Customer object on your platform, and do a regular, non-Connect payment on that for the amount of the dispute fee(but then what happens if the account holder disputes that one 😅 )