Blog article
See all stories »

Merchant Disputes Unveiled: How Card Protections Measure Up Against A2A Payments

In an era where cashless transactions are the new norm, card payments have firmly established themselves as a preferred method. Still, the possibility of disputes remains. What are the most common dispute scenarios with merchants, and to what extent are customers protected compared to other payment methods, such as A2A?

Understanding cardholder protection levels requires a deeper dive into the frequent scenarios that lead to consumer disputes – and Visa's classifications provide insights.

Cardholders often find themselves in situations where the ordered merchandise or services were not received, leading to the Merchandise/Services Not Received claim. In some cases, the order is cancelled due to an unmet delivery date or the merchandise being unavailable for pick-up. Another frequent grievance is the Cancelled Recurring scenario, where, much to the cardholder's dismay, a recurring transaction is processed even after its cancellation or post the account's closure.

Disputes also arise when the received product or service fails to match its description or is deemed defective, known as Not as Described or Defective Merchandise/Services. The booming e-commerce world, while offering variety, has unfortunately also seen a rise in counterfeit goods, culminating in the Counterfeit Merchandise claim.

A scenario that hinges on the nuances of the transaction, Misrepresentation, involves cases where the terms of sale were misreported. Adding to the list is the ever-frustrating Credit not Processed situation, in which the cardholder awaits a credit that never reflects, and the similar Cancelled Merchandise/Services, where credit remains unprocessed after a product return or service cancellation. In some instances, the Original Credit Transaction Not Accepted issue emerges, where the original credit is downright rejected.

The appeal of cards as a payment medium isn't just convenience – it's the consumer protection they provide. Organisations like Visa and Mastercard have established solid policies to shield cardholder rights and ensure merchants meet their commitments. 

The Chargeback process is a testament to this protective framework, outlined on Visa's website. In a dispute, cardholders can approach their bank, prompting an investigation. A validated claim results in the bank retrieving the disputed transaction amount from the merchant’s bank, ensuring cardholders are not left out of pocket.

A2A transfers, while direct and prompt, do not possess the structured dispute resolution procedures established in card payments. While banks do offer protection against erroneous or fraudulent transfers, this shield often doesn't extend to merchant disputes. This makes card payments a more reassuring choice for consumers concerned about transactional disputes – which is why establishing a similar structured dispute process for A2A payments is essential in order to build the same level of trust customers have in card payments.

In summary, while disputes are a source of concern for many consumers, the payment method they choose can greatly influence the resolution. Card payments, supported by the rigorous policies of international brands like Visa and Mastercard, offer a comforting assurance. With clear processes addressing a broad spectrum of dispute scenarios, cardholders can shop with the confidence of knowing their interests are protected. For card issuers, emphasising this unique selling point can not only build trust but also drive transaction volumes. By promoting their cardholder-friendly processes, issuers can claim top-of-wallet positions, ensuring their cards are the preferred choice for consumers.


Comments: (1)

Ketharaman Swaminathan
Ketharaman Swaminathan - GTM360 Marketing Solutions - Pune 14 September, 2023, 10:00Be the first to give this comment the thumbs up 0 likes

Great post!

It's my longstanding view that lack of fraud protection is a big reason why A2A RTPs - whether they use Open Banking or not - have failed to gain traction in advanced markets like UK and USA where credit card has high penetration.  

As I highlighted in Why Don’t UPI / Zelle Provide Fraud Protection?, it goes against the charter mission of A2A RTP to offer chargeback.

In other words, fraud protection is a feature of credit card but a bug of A2A RTP MOPs.

Fatemeh Nikayin

Fatemeh Nikayin



Member since

13 Sep 2021



Blog posts


This post is from a series of posts in the group:

Payments strategies 2015-2020-2030

Payments systems visions, strategies, trends, pilots, forecasting, and planning for the short-, medium-, and far-term.

See all

Now hiring