Disputes (also called chargebacks) occur when a customer calls their bank, or PayPal to dispute a charge.
This can be for many reasons, including:
Chargebacks are an unfortunately common part of dealing with online payments, and especially common in the world of software.
It’s important that you keep your Dispute/Chargeback rate low. An average rate is in the region of 0.1-0.3% of transactions, however an amount below 1% is acceptable.
When a dispute occurs, Paddle fights the dispute on your behalf, submitting the relevant evidence direct to the bank or gateway, or in the instance of misidentified transactions, we reach out to the customer and attempt to resolve the situation for you.
Disputes incur a $15 (£15 or €15) fee dependant on the currency the user was charged in. These fees come directly from the customers bank, and we pass on the charge to your Paddle account. Additionally, the original amount of the transaction is also debited from your Paddle account.
In the instance that we win a chargeback case for you, we return the original amount of the transaction back to your balance, and refund any fees associated with the dispute.