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Disputes

Dispute Types#

Card-Specific Disputes#

RiskExampleGuards within Unit
Card transaction disputes (compensation)Account has a $100 balance. $50 is spent via card. End-customer files a complaint for an unauthorized transaction. Reg E requires an investigation and potentially compensation in the form of provisional credit and final credit.
  • Transaction level: 3rd party tools (Visa fraud scoring, real-time authorization)
  • Transaction level: controls (per-card limits)
  • Expertise in dispute management (Visa call center)
  • Card controls (freeze card)
Card settlement is higher than initial authorization (negative balance)

Account has a $100 balance. A card transaction is authorized for $100 but the final settlement amount that arrives later is $110. This can occur with merchants where amounts can vary such as restaurants, hotels, or international transactions.

The above situations will result in a negative balance of -$10.

Unit assumes a buffer above the original authorization amount in the case of relevant merchants, to prevent such situations. If the balance is insufficient, the transaction will be denied.

In some cases, a negative balance could still occur, due to the inherent flexibility that the card networks (e.g. Visa) offer to merchants. If the negative balance is meaningful (e.g. more than $50), Unit could assist with filing a dispute with the network (e.g. Visa) to avoid a loss.

Non-Card Disputes#

RiskExampleGuards within Unit
Overdraft (negative balance)Account has a $10 balance and tries to spend $12 via card. Account has a $10 balance and another institution issues an ACH debit to pull $12.By default, overdraft is disabled. Transactions and authorizations are processed sequentially and all attempts to spend funds in excess of balance (via ACH credit, ACH debit, card etc.) are blocked and kept in audit log for investigation.
ACH debit origination return (negative balance)Account has a $0 balance. End-customer initiates an ACH debit for $50 from Chase. The funds are sent from Chase and fully spent. After 20 days, the other institution reports that the billing was unauthorized and asks to return the transaction. Account is now at -$50.
  • Onboarding: best-in-class tools
  • Onboarding: controls (OTP)
ACH credit origination dispute (compensation)Account has a $100 balance. End-customer initiates an ACH credit for $50, sending funds to Chase. End-customer files a complaint for unauthorized transaction. Reg E requires an investigation and potentially compensation in the form of provisional credit and final credit.
  • Transaction level: OTP
  • Expertise in dispute management (Unit compliance team)
Reversal of provisional credit (negative balance)Uncommon case: account has a $50 balance. $50 is spent via card. End-customer files a complaint for unauthorized transaction. During investigation, the account is credited with $50 as provisional credit until investigation is complete, in line with Reg E timeline. The $50 in provisional credit is spent via card while the investigation is underway. Eventually, the investigation is complete and the complaint is rejected, triggering a $50 debit as reversal. Account is now at -$50.

Dispute Handling#

The dispute management process largely depends on the type of dispute:

  • For card transactions, our Visa-managed call center will handle the dispute end-to-end.
  • For non-cards disputes (ACH, wires), you will act as the “gatekeeper” to the process – fielding the initial communication from your customer, creating a ticket for Unit to investigate, and communicating the result of the investigation back to the customer.

For more information, please refer to the Customer Support Guide.

Product typeProcessYour responsibility
Card
  • End User contacts cards support via the toll-free number printed on their card
  • The Visa-managed call center answers calls with personalized greeting: “thank you for calling [your company]’s card support”
  • All cases are managed in line with regulatory guidelines (Reg E)
  • Visa provides Unit with a full case history, which Unit provides to you
Process is managed end-to-end; no action is needed from you
Non-Card (ACH, Wires)
  • End User contacts you
  • You share the End User’s information with Unit’s Customer Support team
  • Unit sorts and actions the dispute in accordance with our Customer Support Guide and relevant regulatory guidelines
  • Unit provides full reporting to you as the case is managed and upon resolution
  • Verifying the End User’s identity and relevant transaction details
  • Communicating the information to Unit as soon as possible via our support system integration or support@unit.co inbox
  • Communicating the result of the investigation back to the End User once Unit has resolved the case

Technical Aspects#

You will be notified of disputes using a webhook transaction.created event with type DisputeTransaction.

Dispute processes are typically initiated by Unit following a request from an end customer.

  • While a dispute is in progress, Unit may grant the customer Provisional credit, resulting in a dispute transaction with a positive amount and "ProvisionalCredit" as the reason.
  • If the dispute is resolved (decided in favor of the customer)
    • If provisional credit was previously granted, Unit will withdraw those funds, resulting in another dispute transaction (with a negative amount), and "ProvisionalCreditReversalResolved" as the reason.
    • Unit will issue the final credit to the customer (resulting in a Dispute Transaction with "FinalCredit" as the reason).
  • If the dispute is Denied (decided against the client), and Unit has previously granted provisional credit to the customer, Unit will withdraw those funds, resulting in another dispute transaction, with a negative amount, and "ProvisionalCreditReversalDenied" as the reason.