Welcome to another session of our Studio Pro Learning Lab series!

In this session, we're diving into Chargeback Best Practices: How to prevent, respond to, and win more disputes.

What we'll cover:

• Understand chargebacks and why they happen
• Learn how to prevent chargebacks
• Discover best practices for disputing chargebacks
• And more!

Studio Pro Chargeback Best Practices

This Q&A summarizes the key points from our Learning Lab on chargebacks, including what they are, how to prevent them, and how to respond effectively if one occurs.

Understanding Chargebacks

Q: What is a chargeback?
A: A chargeback (or dispute) is a transaction reversal initiated by a customer’s bank or card issuer. It usually occurs when a cardholder disputes a charge, either because it was unauthorized, fraudulent, or they believe the service was not received.

Q: Who makes the final decision in a chargeback?
A: The customer’s issuing bank makes the final decision, not Studio Pro or the payment processor. Studio Pro can help you gather and submit evidence, but the outcome is determined solely by the card issuer.

Q: What are the steps in the chargeback process?
A:

1. The customer makes a purchase.

2. The customer disputes the charge.

3. The issuing bank removes the funds from your account and reviews the claim.

4. The business submits evidence to counter the claim.

5. The issuing bank decides the outcome.

Common Reasons for Chargebacks

Q: What are the most common reasons for chargebacks?
A:

• Fraudulent transactions: The cardholder does not recognize the charge or did not authorize it.

• Service not received: The parent claims classes or services were not delivered.

• Credit not processed: A refund was promised but not issued.

• Duplicate charge: The customer was charged twice by mistake.

• Canceled recurring transaction: The parent withdrew but still had auto-pay charges processed.

Q: How can I prevent a chargeback related to a family member’s card?
A: Get a signed agreement from the actual cardholder authorizing payments. For example, if a grandparent is paying, ensure they sign the auto-pay or payment waiver to avoid disputes later.

Preventing Chargebacks

Q: How can I reduce the risk of chargebacks at my studio?
A:

• Have clear, concise written policies for tuition, refunds, withdrawals, and auto-pay agreements.

• Use signed electronic waivers in Studio Pro rather than just posting policies on your website.

• Train staff to process transactions accurately and confirm payment details.

• Collect signatures from parents for all payment-related agreements.

• Track attendance consistently to prove services were provided.

Q: Where can I set up my waivers and policies in Studio Pro?
A: Go to More → Settings → Waivers and Policies. You can create and store signed policies for each season, retaining records year after year.

Q: Why is it important for parents to enter their own payment information?
A: When parents enter payment details directly through the Parent Portal or Auto-Pay setup, it provides stronger authorization evidence in case of a dispute.

Q: Why is attendance history helpful in chargeback cases?
A: Attendance records from the Class Manager can show proof that the student attended classes, which supports your case if a parent claims the service was not received.

Disputing Chargebacks

Q: What is the best way to prepare evidence for a chargeback dispute?
A:

• Organize all documents by type, such as signed policies, receipts, or emails.

• Include short explanations for each piece of evidence to clarify what it proves.

• Use clear, readable screenshots or files.

• Avoid sending unnecessary or unrelated material.

Q: What evidence should I include?
A: Examples include:

• Signed payment policies or waivers

• Class enrollment and attendance history

• Proof of delivery for costumes or products

• Clear refund records

• Relevant email or text conversations with the parent.

Q: How quickly should I respond to a chargeback?
A: Immediately. Banks give a limited timeframe (often 5 to 30 days). If evidence is not submitted in time, the case is automatically lost.

Q: Can I lose a dispute even with a signed policy?
A: Yes. The issuing bank has full discretion. Even strong evidence, like signed waivers, may not guarantee success if the bank sides with its customer.

Handling Special Chargeback Situations

Q: What if a customer files a chargeback after I already issued a refund?
A: They will not receive a double refund. The card issuer will recognize the existing refund. If needed, submit proof of the refund (such as a screenshot or receipt), and the dispute will be canceled.

Q: Should I accept a chargeback?
A: Sometimes yes. If the dispute is valid, such as a duplicate charge, you can accept it. Accepting a dispute is not an admission of wrongdoing; it simply closes the case. However, prevention is the best strategy because all disputes count toward your dispute rate regardless of outcome.

Q: What if the parent tells their bank they made a mistake disputing?
A: You should still submit your evidence. Even if they say they will withdraw the dispute, submitting documentation ensures you are protected if they forget to contact their bank.

Q: How do I handle partial refunds that are later disputed?
A: Submit proof of the partial refund, including the amount, date, and screenshot from Studio Pro Merchant Services. The card issuer will typically adjust or cancel the original dispute.

Support and Resources

Q: Who can I contact for chargeback assistance?
A: Email support@gostudiopro.com. They can help gather system records such as waivers, transaction logs, and attendance to include in your response.

Q: What are the best practices for preventing chargebacks?
A:

1. Maintain clear, concise refund and payment policies.

2. Use signed electronic waivers, not website-only policies.

3. Have parents enter their own payment information.

4. Keep accurate attendance records in Class Manager.

5. Always respond promptly to chargeback notifications.