Chargeflow's Alerts system is designed to proactively prevent chargebacks. When we receive a dispute alert, we automatically issue a refund to stop it from escalating into a formal chargeback. In almost all cases, this works seamlessly — but in rare instances, a chargeback may still occur.
Why Does This Happen?
There are a few reasons a chargeback can slip through even after a refund is issued:
Processing Delays — There can be a lag between when the refund is processed and when the issuing bank sees it. If the bank doesn't detect the refund in time (especially if your PSP batches refund data overnight), they may proceed with filing the chargeback anyway.
Close Time Proximity — In some cases, the refund and the chargeback are processed almost simultaneously, leaving no window for the refund to prevent it.
Bank Decision — The issuing bank may choose to proceed with the chargeback even after seeing the refund, typically as a protective measure for the cardholder.
Important: Refunds and chargebacks cannot both be completed for the same transaction. If the chargeback goes through, the initial refund is typically canceled out.
Here's an example of how this can look:
June 4 — An alert is received and a refund is automatically initiated.
June 5 — A formal chargeback is filed by the issuing bank.
Shortly after, the refund attempt fails due to the chargeback being processed ("Unable to refund $41.34 USD").
Important Exception: Verifi RDR Alerts
This scenario works differently for Verifi RDR (Rapid Dispute Resolution) alerts.
If an alerted transaction is marked as “Prevented” or “Refund Initiated” and shows a status of "Dispute Lost" or "Chargeback Lost" in your payment processor dashboard — don't be alarmed. This does not mean a chargeback was lost. It means the refund was successfully processed by the acquiring bank and the formal chargeback was prevented. It will not negatively impact your dispute ratio.
Why Does Shopify Show "Chargeback Lost" or “Chargeback Resolved”?
RDR is a Visa prevention service that automates refunds within the Visa network the moment a customer opens a dispute. Shopify displays these as "Chargeback Lost" or “Chargeback Resolved” but those labels are misleading — there are two things you can look for to tell the difference from a true chargeback:
The refund was issued on the same day the alert was received.
There is no chargeback response timer shown in Shopify — a real chargeback would have one.
These are prevented chargebacks. Your customers have been refunded, and your chargeback ratio is not affected at the network level.
That's how Shopify displays RDR on their end, and unfortunately, we don't have a way to override how those statuses appear there.
What About Shopify Analytics?
Shopify now includes RDR cases in the chargeback rate shown in Shopify Analytics — but this is a reporting change only. Disputes resolved through Visa RDR are still treated as pre-disputes and do not count toward the official chargeback ratios used by card networks or acquiring banks.
Those official ratios — set by Visa, Mastercard, and your acquiring bank — are what determine monitoring programs, restrictions, or account suspensions. Shopify's internal numbers may appear higher, but your actual network-level chargeback risk has not changed. Learn more about this Shopify update here.
Note for Stripe Users
For Stripe RDR alerts, the same principle applies — it will not impact your dispute rate. However, we recommend contacting Stripe support to activate the dispute_network_token feature on your account. This ensures resolved RDR alerts are not counted as "Dispute Lost" in your Stripe dashboard.
If a refund didn't go through and a chargeback was filed instead, please send the alert ID and transaction ID to support@chargeflow.io via Live Chat or email. Our team will review the case for you.