Dispute Resolution Platform: Web Shield Launches for Acquirers

Mastercard has changed its dispute resolution process to include a pre-dispute or collaboration stage. This aims to prevent disputes from becoming chargebacks, thereby making the entire process quicker, cheaper and more efficient. We summarise the main requirements and impact for acquirers and payment service providers (PSPs).

Card disputes are becoming more difficult to manage. Dispute volumes are growing. Almost half of all e-commerce merchants are seeing more chargebacks. And as it costs $20-100 to resolve a chargeback, disputes are becoming more expensive to deal with, too. That’s even before the losing party factors in three times the transaction value for an unsuccessfully contested chargeback.

So, anything that minimises the time, budget and resource spent on dispute management clearly benefits acquirers and PSPs, and leads to a better experience of using and accepting cards.

What’s happening?

When cardholders disputed charges on their statement, they typically contact their issuer instead of the merchant. However, as merchants hold the purchase details, issuers often lack the necessary information to adequately validate and resolve disputes quickly and efficiently.

The Mastercard dispute cycle now has four phases: collaboration, chargeback, representment and arbitration. Effective 17 July 2022, prior to initiating a chargeback, issuers must file a collaboration request with Mastercard. Acquirers have 72 hours to respond to such a request, before the dispute automatically becomes a formal chargeback.

The purpose of the collaboration phase and Mastercom, Mastercard’s dispute resolution platform, is to bridge the communication gaps in the four-party model. It’s hoped that allowing acquirers and merchants to respond to consumer enquiries before funds movement and outside of chargeback cycles will help minimise preventable disputes.

What does this mean for acquirers and PSPs?

Acquirers and PSPs have 72 hours to action and reply to collaboration requests, before they automatically become chargebacks. Web Shield has developed a plug-and-play chargeback management platform to help with this.

As Web Shield is an official Mastercard Collaboration Service Provider, our platform connects directly to Mastercom or Ethoca, a secure e-commerce fraud and chargeback protection company, and gives your merchants a way to review disputes for quicker resolution.

The Web Shield platform is quick, easy and free for customers to implement. Little to no development work is needed from acquirers or PSPs to enable merchants to:

• See all notifications / requests in one place
• Easily review and trigger refunds
• Define auto-refund rules
• View extensive statistics on current and historic disputes
• Edit and manage additional billing descriptor data

In addition, to the above functionality, acquirers and PSPs can:

• Brand the look-tone-feel of the platform
• Send branded e-mail notifications
• Easily add and edit merchants and billing descriptor data
• Set automatic refund rules for merchants
• Export reports with a single click

For more information

Get in touch for a presentation and to find out how easy it is to implement your own branded dispute resolution management platform.

To learn more, see the Mastercard bulletin AN 4655 Inclusion of Acquirers in the Mastercom Collaboration Process (January 2022).