• Credit card chargeback to merchant not honoured by issuing bank

VISA Inernational Operating Guidelines: http://usa.visa.com/download/merchants/Public-VIOR-15-April-2014.pdf. Details how and when charge back to merchants can occur in the event the credit  card holder disputes the transaction with card issuing organization. 

This question is(point 3 below being most important)

1. Whether all banks and credits issuing organizations are bound to uphold this. It might be noted that no where there has been an explicit denial that disputes between merchants and card holder have to be settled within themselves and that banks are not responsible.

2. Whether the bank should honor the chargeback under reason code 53 in my case

3. Whether I can file a consumer complaint against the bank for lack of services(did not houour the charge back request despite numerous proofs provided in support) and against Visa Inc(for not providing its customers, the cardholders, with an appropriate mechanism to raise complaints against card issuing bank and not overseeing the complainace of its rules and policies)

4. Not about whether I can pursue a consumer complaint against the merchant itself directly.I know I can do that.

The broader issue is whether credit cards as payment medium can provide an extra protection to buyer through legitimate charge backs that it claims to provide.

The issue is

1. I bought a product online through an online store using a Visa Credit card. The delivered product was old, looked refurbished and did not function properly. I raised the alarm with the merchant through their customer support phone numbers immediately and they assured me of looking into the matter and wait for further deliberations. I had a good rapport with this online merchant prior to this incident and had bought lot of articles  online earlier I therefore waited for them to respond. Later seeing that they are not responding I contacted them again through phone and this time I also filed the complaint through their online customer support form on their website(I have recorded the snapshots and have provided it to the bank too). The merchant systems however does generate an acknowledgement for the complaint that the customer submits either through online form or through phone calls. Now after having raised the dispute about this transaction with the bank the merchant has started denying the receipt of any such complaints.It may noted here that the merchant systems are under their control and they can manipulate any details to suit their explanation.

2. I raised the dispute about this transaction with the bank  after waiting for about 2 weeks for  merchant to respond. In this period and the period following this I had made numerous attempts to liaise with the merchant through mails and phone calls. On many occasions I had kept the bank credit card support email ID in copy.

3. The bank as part of resolution contacted the merchant who now claims that the they received the complaint after stipulated time, whereas the fact remains that I contacted them over phone immediately to inform about the problem.The credit support has since then towed a single line of resolution that since the article is delivered you are liable for payments no mater how the product is and in case of dispute I should contact the merchant directly and the bank is not liable or could help me any further. They are always upholding the merchants explanations instead of protecting the buyer and their customer.

4. I did whatever the bank asked me do to reach a resolution with merchant like contacting their support over email and returning the article to the merchant which the merchant did not accept. It might be also noted that a fair effort has been done by me to communicate and return the defective product back to the merchant.

5. I believe this argument of time frame that the merchant has put forward and which is also upheld by the bank on when the defective product information is communicated to the merchant is base less because being a visa card holder and as per the regulations that are set out for chargeback in their operational guidelines the bank should issue a charge back to the merchant irrespective of the time frame that the merchant has set for resolutions
Asked 2 years ago in Business Law from Udaipur, Rajasthan
1) it is your case that defective goods have been supplied to you . further you have telephonically contacted the merchant and complained of defective goods supplied . 

2) you have informed the bank about defective quality of goods supplied and tried to return  the defective goods which were not accepted by merchant 

3) bank has refused to give you charge back on grounds that cause of action is against the merchant as goods have been delivered to you

4) visa operational guidelines code 53 provide that for Us and canda transactions card holder must return the goods or make valid attempt to return  the goods . for other international transactions goods must be returned . if goods have been returned the charge back must be accepted . 

5) in your case goods have not been returned as merchant failed  to accept it . the guidelines discriminate  between us , canda and other international transactions . 

6) move consumer forum against merchant . seek refund of money paid with interest . also make bank a party to said proceedings . 

7) as per operational guidelines bank is not bound to issue  charge back to customer
Ajay Sethi
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1. File a complaint case before your local District Consumer Dispute redressal Forum against the Merchant for supplying you the old & defective article after taking full payment thereof and also refusing to take return of the said defective article alleging deficiency in service and unfair business practice claiming full refund of the amount paid, damage for mental agony, interest and litigation cost,

2. You should also make the Bank a party to this case or file a seperate consumer complaint case against the VISA for discriminating with its clients of countries other than USA & Canada.
Krishna Kishore Ganguly
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