Disputes reasons
Understand what disputes are, why they occur, and your responsibilities as a Partner integrating directly with Klarna.
10 min read
A dispute occurs when a customer challenges a transaction through Klarna. As a Partner integrating directly with Klarna, you respond to disputes raised against your transactions by gathering evidence, submitting it before the deadlines, and working with Klarna to resolve issues fairly.
Disputes follow a five-stage lifecycle (
INITIATED, REPRESENTMENT, PRE_ARBITRATION, ARBITRATION, and CLOSED) where you submit evidence before deadlines and can appeal preliminary decisions.Each dispute falls into one of seven categories. The first five are the most common; the last two apply to specific program or compliance situations. For detailed evidence requirements and prevention tips for each type, see Dispute evidence guidelines.
The customer claims that the product or service never arrived. This may result from shipping delays, incorrect delivery, or failure to dispatch the item. You are required to provide shipping details and proof of delivery.
Example:
- Scenario: A customer named Emily orders a laptop from your store. After the expected delivery date passes, Emily contacts your customer service to report that she has not received her laptop.
- Dispute Trigger: Emily initiates a dispute through Klarna, claiming that the products were not received.
- Expected Action: You should review the dispute and provide available evidence, such as tracking details, proof of shipment, and delivery confirmation.
- Resolution Pathway 1: You review your shipping records and discover the shipment was delayed due to a courier issue. You provide Klarna with tracking information, proof of shipment, and the updated delivery timeline via the API or Partner Portal. Once Emily receives the package and confirms delivery with Klarna, the dispute is resolved in your favor.
- Resolution Pathway 2: Your records indicate the laptop was delivered to the correct address. You submit the proof of delivery through Klarna's dispute process (API or Partner Portal). Klarna reviews the evidence, verifies successful delivery, and closes the dispute in your favor.
- Required Evidence: Shipping confirmation, tracking ID, proof of delivery and recipient name for validation.
The customer believes that the received product is damaged, defective, or does not match the description on your website. Klarna may ask for documentation from both parties, such as photos, product descriptions, or return tracking. For information about what qualifies as "Significant deviation", see the Merchant Protection Program.
Example:
- Scenario: James orders a set of dining chairs from your store. Upon delivery, he discovers that one of the chairs is damaged.
- Dispute Trigger: James initiates a dispute through Klarna, reporting that the goods were delivered in poor condition.
- Expected Action: You should collect and submit relevant evidence, such as photos of the damaged item, shipment details, and any correspondence with James.
- Resolution Pathway 1: You review photos of the damaged chair from James. After confirming the damage through the provided images, you offer James a replacement chair at no extra cost and promptly arrange for shipment. You submit proof of the replacement (e.g., shipping and transaction details) through Klarna's Disputes API or Partner Portal.
- Resolution Pathway 2: You review the dispute and provided photos but determine that the chair's condition does not match the claim or that the damage resulted from misuse after delivery. You submit your evidence and reasoning via Klarna's Disputes API or Partner Portal. Klarna reviews all documentation, rules in your favor, and closes the dispute.
- Required Evidence: Confirmation that changes will be made to order or alternative resolution was arrived at. Transaction IDs and/or numerical discounts in form of attachment is required.
The customer identifies an error in the invoice — for instance, being charged for the wrong item, an incorrect amount, or an extra fee. You may be required to adjust or reissue the invoice.
Example:
- Scenario: Olivia purchases a smartwatch from your store using Klarna's payment services. However, when she checks her bank statement, she notices that she has been charged twice for the same item.
- Dispute Trigger: Olivia contacts you and subsequently raises a dispute through Klarna, claiming an incorrect charge.
- Resolution Pathway 1: You review your payment records and confirm that a duplicate charge occurred due to a system error. You promptly issue a refund for the extra payment through Klarna's Dispute API and provide evidence, such as transaction logs and invoice copies, to support the resolution. Klarna reviews the submission and informs Olivia of the refund.
- Resolution Pathway 2: You review your payment records and find no evidence of a duplicate charge. Your investigation shows that the transactions on Olivia's statement correspond to separate orders or activities. You submit evidence via Klarna's Dispute API to demonstrate that the charges were legitimate. Klarna reviews the evidence, determines that the charges are valid, and closes the dispute in your favor.
- Required Evidence: Relevant financial records and invoice copies in form of attachment.
The customer claims they did not authorize the purchase, suggesting potential fraud or misuse of their Klarna account. These disputes are prioritized and must be addressed quickly. Klarna may request fraud detection logs or customer verification data.
Example:
- Scenario: Michael notices a transaction on his account for a high-end gaming console from your store, where he has never shopped before.
- Dispute Trigger: Michael suspects fraud and files a dispute through Klarna, stating that the purchase was unauthorized.
- Expected Action: You should investigate the purchase and supply any fraud prevention measures taken (e.g., proof of delivery, communication with the recipient, etc).
- Resolution Pathway 1: You investigate the transaction and find that you can recall the package, and do so. You confirm that the purchase was unauthorized and promptly cancel the order. You refund Michael and provide the required evidence to clarify the situation. Klarna reviews the evidence, confirms the refund, and updates Michael.
- Resolution Pathway 2: You investigate the transaction and find no evidence of fraud. Your review shows that the order was placed from a device and location consistent with previous purchases associated with Michael's account. You submit evidence via Klarna's Dispute API. Klarna reviews the evidence and determines that the transaction appears legitimate.
- Required Evidence: Transaction details, customer verification steps, proof of delivery evidence in line with the delivery method, and any fraud reports.
The customer indicates they have returned one or more items from their order. They may be waiting for a refund or a corrected invoice. You are required to verify that the return has been received and to update the invoice accordingly.
Example:
- Scenario: A customer, Sarah, returns an item purchased from your store. Despite receiving confirmation from the courier that the return was delivered to your warehouse, Sarah hasn't received her refund after 14 days.
- Dispute Trigger: Sarah contacts Klarna to initiate a dispute, claiming "Refund not processed".
- Expected Action: Confirm receipt of returned items; specify condition or reason if not accepted.
- Resolution Pathway 1: You review your return records and confirm receipt of the item. You discover that the refund was delayed due to a processing error. You promptly issue the refund to Sarah and notify her of the resolution through Klarna's Dispute API or Partner Portal. Sarah confirms receipt of the refund, and the dispute is resolved and closed.
- Resolution Pathway 2: You review your return records and find no evidence of receiving the returned item. You submit proof via Klarna's Dispute API or Partner Portal, including warehouse logs and courier tracking data, showing that the return was never delivered. Klarna reviews the submitted evidence, determines that you are not liable, and closes the dispute in your favor. Sarah is notified of the decision, and the case is resolved.
- Required Evidence: Return policy compliance, item photos, or tracking records for returned items, acknowledgement of return.
For transactions where Klarna has determined that you are enrolled in the Risk Program and are in Major Breach, as defined in the Klarna Agreement (see the Dispute section for details), and the customer has not successfully disputed the transaction under another Dispute type.
For this dispute reason, Klarna does not send a request. The dispute is initiated by Klarna and closed immediately as a loss.
Debit risk Payment Program only
This reason only applies to the "Debit Risk" Payment Program Partners.
Klarna identified that the transaction was not paid by the customer and reverses the claim. Only applicable to the "Debit Risk" Payment Program.
For this dispute reason, Klarna does not send a request. The dispute is initiated by Klarna and closed immediately as a loss.
Klarna offers customers the opportunity to challenge the outcome of a dispute and ensure that their concerns are properly addressed by allowing multiple disputes per transaction. This demonstrates Klarna's dedication to consumer protection laws and ensuring a fair resolution process. However, to prevent misuse, Klarna enforces certain boundaries and rules in the dispute process to maintain fairness, prevent abuse, and comply with regulatory obligations.
There are different scenarios why a transaction gets disputed several times:
- The customer wants to present new evidence to defend a dispute.
- The customer disputes the transaction for different reasons (for example,
PRODUCTS_OR_SERVICES_NOT_RECEIVED,REFUND_NOT_PROCESSED, andINCORRECT_AMOUNT). - Connected to a concern and reevaluation of the case.
To support customers with these scenarios, Klarna has set a limit of three disputes per transaction. This limitation is also in place to align with industry standards and other payment providers.
Dispute limit exceptions
Please note that there are a few exceptions where Klarna is required to raise a dispute outside of the dispute limitations. The exceptions include disputes raised in relation to:
- Unauthorized Purchases
- Legal claims raised via an external authority, such as the Central Arbitration Committee or National Board for Consumer Disputes
- Local legal consumer protection rules (for example, the right to object in Sweden, where an agent is required to reopen a dispute again)
- Debt Collection*
Debt collection refers to when an unpaid debt is moved to an external debt collection agency. When a customer disputes this action, Klarna is required by law to provide evidence that supports the customer's obligation to pay.
Disputes can only be raised during the corresponding time according to the dispute type:
| Dispute type | 1st dispute |
|---|---|
| Refund Not Processed | 180 days (from capture) |
| Products or services not received | 180 days (from capture) |
| Incorrect amount | 180 days (from capture) |
| Products defective or not as described | 180 days (from capture) |
| Purchase Unauthorized | Per local consumer protection rules |
Monitor and respond:
- Set up webhooks for real-time notifications
- Review disputes immediately
- Submit evidence before deadlines
Provide evidence:
- Gather relevant documentation
- Upload files via API (PDF up to 7MB)
- Explain your case clearly
Manage outcomes:
- Track dispute rates to identify patterns
- Analyze reasons for lost disputes
- Implement preventive measures
Related articles
Jump to section...