Banks and Building societies offer strong customer protection for any Direct Debit payments that are collected in error from their bank account. This means that it is difficult to dispute wrongful chargebacks once they have occurred.
Many banks will not accept an online mandate as proof that a customer has authorised a Direct Debit. As a result, GoCardless are not able to assist with disputing chargebacks.
- First, get in touch with your customer to find out why they have charged back the payment. In most cases the customer has not recognised the payment on their bank statement. If necessary, you can also advise your customer that it is a crime under the 2006 Fraud Act to wrongfully charge back a payment.
- If you are not able to resolve the issue by speaking to your customer you would have to dispute the chargeback through the small claims court. You can contact the Citizens’ Advice Bureau for more details on this.
We would advise merchants to have a written agreement or contract with the customer outside of GoCardless. In the event of a chargeback this agreement can be used as evidence that a customer has agreed to pay you.