Background and Process
A dispute (also known as a chargeback) occurs when a cardholder (food business) questions a kitchen's payment with their card issuer. The card issuing bank or institution creates a formal dispute which immediately reverses the payment.
Some of the common reasons why a cardholder (food business) may initiate a dispute (chargeback) are:
The cardholder (food business) doesn’t recognize or didn’t authorize the charge
The cardholder (food business) was accidentally charged twice
The cardholder (food business) never received the product or service, or the quality wasn’t as expected
Once a dispute has been initiated by a food business against the kitchen, the payment amount, along with a separate dispute fee, is deducted from The Food Corridor's account balance. Since the funds are deducted from The Food Corridor (TFC) and not the kitchen, TFC will charge the kitchen for the dispute amount AND the chargeback fee that Stripe Charges ($15). If the dispute is settled in the kitchen's favor, TFC will refund the amount that was charged to the kitchen when the dispute was initiated.
Settling a Dispute
If you believe your client did not owe these payments to you, you can accept the dispute and let it settle in their bank's favor.
If you believe this money is owed to you by the food business, these will be the options to move forward with the dispute:
Dispute the dispute: In order for the funds to be collected, we will need to submit evidence to your client's bank as soon as the dispute has been initiated. The evidence needs to show that the charges were accurate and prove that the client received the services in order to collect the funds from the bank and your client. Evidence could include contracts, emails, proof of kitchen use, etc. This process typically takes 60-75 days to reach a resolution. If the dispute is found in your favor, the disputed amount and fee is returned to you. If a dispute is upheld, the card banking institution's decision is final and the cardholder’s payment remains refunded.
Direct collect: The other option, which tends to be quicker and easier, is for the kitchen to collect the amount directly from your client to make yourself whole and then let the dispute settle in their bank's favor.
Client can withdraw: For disputes that are the result of a client's misunderstanding, your client can ask their card issuer to withdraw the dispute. It is still important that evidence is submitted to show that the payment was valid and to ensure that the card issuer knows we are not accepting the dispute.
Please note that the full lifecycle of a dispute, from initiation to the final decision from the bank, can take as long as 2-3 months to complete.
If you have any questions regarding disputes or ways to prevent a dispute, please contact us for further assistance.