Disputes reasons
Understand what disputes are, why they occur, and your responsibilities as an Acquiring Partner.
What is a dispute?
A dispute occurs when a customer challenges a transaction through Klarna. As an Acquiring Partner, you manage disputes on behalf of your Partners by gathering evidence, responding before deadlines, and working to resolve issues fairly.
Disputes follow a five-stage lifecycle (INITIATED, REPRESENTMENT, PRE_ARBITRATION, ARBITRATION, and CLOSED) where Partners will need to submit evidence before deadlines and can appeal preliminary decisions.
Dispute reasons
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.
Products or Services not Received
The customer claims that the product or service never arrived. This may result from shipping delays, incorrect delivery, or failure to dispatch the item. The Partner is required to provide shipping details and proof of delivery.
Example:
- Scenario: A customer named Emily orders a laptop from ShopStore Electronics. After the expected delivery date passes, Emily contacts ShopStore 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: The Partner should review the dispute and provide available evidence, such as tracking details, proof of shipment, and delivery confirmation.
- Resolution Pathway 1: Partner (ShopStore) reviews their shipping records and discovers the shipment was delayed due to a courier issue. They 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 ShopStore’s favor.
- Resolution Pathway 2: Partner's (ShopStore) records indicate the laptop was delivered to the correct address. ShopStore submits 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 ShopStore’s favor.
- Required Evidence: Shipping confirmation, tracking ID, proof of delivery and recipient name for validation.
Products Defective or Not as Described
The customer believes that the received product is damaged, defective, or does not match the description on the 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", please see our Merchant Protection Program.
Example:
- Scenario: James orders a set of dining chairs from HomeStyle Furniture. 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: Partners (HomeStyle Furniture) should collect and submit relevant evidence, such as photos of the damaged item, shipment details, and any correspondence with James.
- Resolution Pathway 1: Partner (HomeStyle Furniture) reviews photos of the damaged chair from James. After confirming the damage through the provided images, they offer James a replacement chair at no extra cost and promptly arrange for shipment. HomeStyle submits proof of the replacement (e.g., shipping and transaction details) through Klarna’s Disputes API or Partner Portal.
- Resolution Pathway 2: Partner (HomeStyle Furniture) reviews the dispute and provided photos but determines that the chair’s condition does not match the claim or that the damage resulted from misuse after delivery. They submit their evidence and reasoning via Klarna’s Disputes API or Partner Portal. Klarna reviews all documentation, rules in favor of Partner (HomeStyle Furniture), and closes the dispute in the partner’s favor.
- 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
Incorrect Amount
The customer identifies an error in the invoice, for instance, being charged for the wrong item, incorrect amount, or an extra fee. Partners may be required to adjust or reissue the invoice.
Example:
- Scenario: Olivia purchases a smartwatch from GadgetGrove 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 GadgetGrove and subsequently raises a dispute through Klarna, claiming an incorrect charge.
- Resolution Pathway 1: GadgetGrove reviews their payment records and confirms that a duplicate charge occurred due to a system error. They 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: GadgetGrove reviews their payment records and finds no evidence of a duplicate charge. Their investigation shows that the transactions on Olivia’s statement correspond to separate orders or activities. GadgetGrove submits 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 GadgetGrove’s favor.
- Required Evidence: Relevant financial records and invoice copies in form of attachment.
Purchase Unauthorized
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 GameHub, a store he has never shopped at.
- Dispute Trigger: Michael suspects fraud and files a dispute through Klarna, stating that the purchase was unauthorized.
- Expected Action: GameHub should investigate the purchase and supply any fraud prevention measures taken (e.g., proof of delivery, communication with the recipient, etc).
- Resolution Pathway 1: GameHub investigates the transaction and finds that they can recall the package, and do so. They confirm that the purchase was unauthorized and promptly cancel the order. GameHub refunds Michael and provides the required evidence to clarify the situation. Klarna reviews the evidence, confirms the refund, and updates Michael.
- Resolution Pathway 2: GameHub investigates the transaction and finds no evidence of fraud. Their review shows that the order was placed from a device and location consistent with previous purchases associated with Michael’s account. They 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.
Refund Not Processed
The customer indicates they have returned one or more items from their transaction. They may be waiting for a refund or a corrected invoice. Partners 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 FashionFusion, an online apparel store. Despite receiving confirmation from the courier that the return was delivered to FashionFusion's 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: Partner confirm receipt of returned items; specify condition or reason if not accepted.
- Resolution Pathway 1: Partner (FashionFusion) reviews their return records and confirms receipt of the item. They discover that the refund was delayed due to a processing error. FashionFusion promptly issues the refund to Sarah and notifies 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: FashionFusion reviews their return records and finds no evidence of receiving the returned item. They 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 FashionFusion is not liable, and closes the dispute in their 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.
Non Compliance
For transactions where Klarna has determined that the Partner is enrolled in the Risk Program and is 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.
Non Guaranteed Payment Program
Klarna identified that the transaction was not paid by the Customer and reverses the Claim to the Acquiring Partner. Only applicable to the “Pay in Full Non-guaranteed” Payment Program.
Responsibilities as an Acquiring Partner
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