Our first disputed charge

We received our first disputed charge on Stripe. It was only a $9 charge, but I was bummed because we've always been really good about refunding money when people ask. I didn't want to cause any trouble, but I was worried it could be a stain on our reputation with Stripe so I challenged the dispute.

I learned a lot. Probably too much to put here, but one thing that really surprised me was the amount of information asymmetry involved in the process.

Let's say that Mike signs up for Scrubber. He connects his Facebook account, Twitter account, and Instagram account. He then pays. He then disputes the charge. As an admin on the site, I can see that the names on the Facebook, Twitter, and Instagram accounts match Mike's. I can see that the email address on his Twitter account is the same email address that he signed up with. I can see that he opened the emails we sent him and clicked links in the emails. This confirms he owns that email address.

So when Mike says he didn't authorize the charge, I have a pretty good case that he did.

Right?

Not so fast. When a dispute comes in, I am not told who actually owns the credit card. Mike could have stolen that card, and the card owner -- not Mike, who is a card thief -- could be disputing the charge. In that case, I actually WANT the dispute to resolve in the card owners favor because why should they be out money? But if it resolves in their favor, I'm out $25, not just $9.

So what's a business to do? In every case that I end up challenging a dispute, I try my best to explain this. Unfortunately the process is very much a black box. You send in your information, and the you hear back 90 days later.

Every single dispute I've ever challenged has been resolved in my favor, but I have no way of knowing what actually happens on the other end. It's a very unsatisfying experience, but thought it was worth sharing.