It's unrealistic to think that every buyer will be happy with every purchase. Making it easy for that buyer to return the item to you and to obtain a refund can help ensure the buyer wants to continue shopping on your site. Even more important, it can help prevent buyers from needing to file an A-to-z Guarantee claim or a chargeback. In this article, you'll learn three things:
- How to easily issue a refund either by using the Refund API or by using Manage Transactions in Seller Central.
- How to respond to or dispute a chargeback claim.
- Best practices to help prevent disputes and protect your business.
How to issue a refund
Amazon Pay allows you to issue refunds either by using the Refund API after you have made a Capture on a successful Authorisation or by using Manage Transactions in Seller Central.
Every time a successful refund takes place, Amazon sends the customer a confirmation email with details about the refund.
Watch a brief overview from Amazon Pay University
You can issue full or partial refunds of a previous charge. A full refund includes all customer costs that are associated with the purchase. Partial refunds can be any amount between zero and the maximum defined by the service. The maximum amount that you can refund to a customer is 15% more than the previously charged amount or a maximum of $75 more than the previously charged amount, whichever is smaller. Also note that the maximum number of refunds allowed for a given charge is 10.
- Sign in to your account in Seller Central.
- Click Orders, and then click Manage Transactions.
- On the Manage Transactions page, locate the transaction for which you want to issue a refund.
- In the Action column, choose Refund from the list of options.
- Or click the Amazon Reference ID link for the applicable transaction, and then on the Details page that opens, click Refund.
- In the Refund Payment dialog box, enter the Refund amount, and also enter text in the optional Notes field.
- Any text that you enter will appear in the refund email that is sent to the customer.
- Click Review.
- A dialog box opens, asking you to confirm the refund.
- In the final dialog box that opens confirming the refund, click Submit.
A chargeback is a reversal of payment issued by the bank or credit card company when a customer disputes a charge through their bank or credit card issuer (and not through Amazon Pay). A chargeback can occur when a customer has not received the items they purchased, has been charged multiple times for a single purchase, or is dissatisfied with the purchase and hasn’t been able to resolve the matter with the merchant.
A customer who can’t resolve their issue with the merchant typically contacts their bank or credit card issuer to request a chargeback. The bank or credit card issuer then notifies the credit card association, which in turn notifies Amazon Pay.
Watch a brief overview from Amazon Pay University
Amazon Pay chargeback notification emails give you details about each chargeback with the following information:
- Seller order ID
- Order reference ID
- Transaction date
- Disputed amount
- Card type
- Dispute type
- Dispute reason code
Chargeback Instant Payment Notification messages include key elements of the above.
The dispute type will help you qualify the different types of chargebacks:
- Unauthorised transaction chargeback is the result of an unauthorised charge and potentially eligible for the Amazon Pay Purchase Protection Policy, as described in the Customer Agreement.
- A service chargeback is filed by a customer, which means that you need to note the card type and dispute the reason code so that you can determine which types of information to submit if you dispute the claim.
Find explanations for the major credit card issuers’ dispute reason codes in the Cardholder Dispute Reason Code Encyclopedia.
Disputing a chargeback claim
When Amazon Pay receives a chargeback claim, we email information to you about the chargeback, including the order number and the amount of the chargeback claim. You need to respond to a chargeback notification within 11 days of the email notification date. If you choose to dispute a chargeback, we assess a Disputed Chargeback fee of $20.00 and require you to provide us with information that we need for disputing the claim. When we have received the information from you, we work with the bank or credit card company to resolve the chargeback.
If you choose not to dispute the chargeback, the dispute is automatically granted to the customer, and Amazon Pay deducts the disputed amount from your account.
Prevention and protection best practices
Consider the following tips for preventing disputes and protecting your business:
- Review and comply with the information in the Customer Service Policy.
- Describe your products and services in as much detail as possible.
- If your customer service policy prohibits refunds or is otherwise unsatisfactory to customers, you may receive more chargebacks than average. Therefore, we recommend reviewing your customer service and business practices for opportunities to resolve customer disputes in a manner that meets both the needs of the customer and your business.
- Make return and refund policies easily accessible to all customers. Ensure that these policies are available to customers during the purchase and checkout process and easily accessible on your website.
- Provide easy access to customer service. Ensure that customer service contact information is visible so customers can contact you with questions or concerns. Always respond to customers as quickly as possible.
- Use a shipping method that provides a tracking number and requires a signature from the recipient for high-value merchandise.
- We strongly encourage you to keep records of the date on which the merchandise was shipped, the shipping method used, and any available tracking information for at least 6 months past the order date.
- Don’t change the shipping address that was provided to you by Amazon Pay. You’re liable for any disputes filed for orders that you send to a different shipping address.
- Retain a copy of the order confirmation email or receipt that was provided to the customer.
- Retain a copy of any communication that you had with the customer regarding a disputed item.
For detailed information about responding to a chargeback claim, see the Chargeback FAQ
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