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RG: Non-Receipt of Goods
RG chargebacks are one of the most expensive problems for merchants. Cardholders contact their bank and claim they never got what they paid for and it doesn’t matter if it’s a physical product they ordered online, a file they downloaded or even a service they bought. Merchants then get hit with an immediate fund reversal along with expensive fees that run from $20 to $100 for each dispute. These non-receipt claims prove especially frustrating because they can hit nearly any business and make them a widespread problem across industries.
Payment processors work with thousands of these RG disputes each month and merchants who don’t fix what causes them watch their chargeback ratios climb to dangerous levels. Payment processors watch these ratios closely because when RG chargebacks build up it shows operational problems that could trigger account reviews or even termination. Merchants face damage that goes well past the original sale, as they also get saddled with chargeback fees, administrative costs and possible penalties that only grow worse with each dispute that remains unresolved.
Merchants who want to successfully manage RG disputes need to know all about the dispute timeline and the exact evidence standards that payment processors expect during their review process.
How It Works
An RG chargeback with Discover means that the customer is claiming they never received what they paid for. Cardholders get 120 days from the expected delivery date to dispute the charge, and it gives them plenty of time to see that something never showed up at their door.
Once the cardholder disputes the charge, Discover sends a notification through your payment processor that shows up as a chargeback alert in your merchant account – like the RG reason code, the disputed amount and the transaction info. From that point, you’re on the clock.
It gets a bit tough for merchants at this point. You carry the full burden of proof. Discover assumes that the customer is right unless you can prove they’re wrong. You need to show that you actually delivered the goods to wherever the customer told you to send them. Without proof you’ll lose the chargeback automatically.
Most merchants get around 10 days to respond to the chargeback notification. Some processors will actually give you less time because they have their own internal paperwork to work through. Miss the deadline and you’ll lose your right to dispute the claim. They’ll pull the money right out of your account and send it back to the customer.
Discover reviews any delivery evidence you provide as proof. Tracking information that shows a delivery to the right location usually wins these cases. Vague delivery confirmations or missing signatures can hurt your case though.
How it Affects Chargeback Prevention
Customer-filed RG chargebacks create problems that go much deeper than losing one sale. These disputes count toward your chargeback ratio and this ratio matters more to payment processors than most merchants realize. Visa and other card networks watch these numbers closely when they decide if you’re still a merchant that they want to work with.
Every single RG chargeback hits you twice financially. You lose the revenue from that original sale and on top of that you pay a chargeback fee that runs anywhere from twenty to a hundred dollars. A few disputes each month means those fees pile up fast and start eating into your profits.
Card networks make this worse by how they view these chargebacks. They don’t treat them as random unrelated incidents. Too many RG chargebacks from your account tells them that you probably have problems with your fulfillment or delivery. Once they spot this pattern then you’ll get stuck with an account review and nobody wants that conversation with their payment processor.
Preventing these chargebacks from happening in the first place is the smarter approach. You want to set up reliable fulfillment processes and accurate records for every shipment that you send out – it costs way less to track your packages than it does to fight chargebacks after customers claim they never got their orders.
Different businesses face different odds with these RG chargebacks too. Sellers of online products and service providers usually have it easier because they can prove delivery instantly. Physical product merchants have to work much harder to protect themselves from these disputes when they’re shipping high-value items or delivering to areas where package theft is common.
Example Scenarios
Chargebacks will hit your business in a few different scenarios and knowing what triggers them helps you protect yourself better. Lost packages are probably the simplest case – when something actually doesn’t make it to your customer. Maybe UPS loses it somewhere along the way or the driver drops it off at the wrong house altogether. Your customer will check their mailbox day after day but nothing shows up. Most of them will contact you first to ask what’s going on. If enough time passes without resolution they’ll eventually get frustrated and file a chargeback with their bank. You can avoid the whole situation by adding signature confirmation to higher-value orders. Just having tracking that says “delivered” isn’t always enough to protect you if there’s no signature to back it up.
Customers who know what they’re doing create a more frustrating scenario. They get their package without any problems then turn around and tell their credit card company that it never arrived. Some of them will even be strategic about it and wait until your return policy expires before they file the dispute. These situations are especially annoying because you’ve done nothing wrong at all on your end. Your tracking information shows that the package was delivered to the right address at the right time. Unfortunately, without signature confirmation or those delivery photos that some carriers give you, you wind up in an awkward position where you have to convince the bank that your customer isn’t telling the truth.
Online products and subscription services bring their own set of problems with chargebacks. A customer might sign up for your monthly software plan and use it for a few weeks. Then out of nowhere they contact their bank claiming they never authorized the transaction or never received access to what they paid for. Your server logs show that they logged into their account multiple times and made use of your service. Unfortunately, banks favor the customer in these disputes almost every time. Your best bet is to maintain thorough records right from the second that a person signs up. Data like IP locations, browser information and login timestamps help you to build a case that the customer did receive and use what they purchased.
Requirements and Timeframes
Cardholders can take as long as 120 days from when they were supposed to receive their order to file an RG chargeback with Discover and this window actually gets even longer when shipping is delayed or when a pre-order gets bumped to a later delivery date – it’s a fairly generous window and it can takes them by surprise when a chargeback shows up months after they figured the whole transaction was finished.
Once Discover sends you that notification about an RG chargeback, the clock starts ticking and you need to act. Most of the time you get just 10 calendar days to pull together your evidence and get your response in. Miss that deadline and you automatically lose the dispute – no exceptions and no do-overs. Some payment processors want your response even sooner because they need a little buffer on their end to review and forward everything to Discover.
Discover wants to see simple documentation but it needs to be thorough. They want signed delivery confirmation or tracking information that shows the package reached the customer’s address. Online products or services require access logs or usage records that show the customer actually received and used what they paid for. International shipments can become tricky because the tracking usually stops once the package crosses the border so you might need proof like customs forms or local delivery receipts.
Custom orders and services with longer fulfillment periods deserve extra attention because more opportunities for problems to pop up. Keep detailed records of every customer interaction, every delivery milestone and every step in the process from start to finish.
Frequently Asked Questions
What evidence works best for defending against RG chargebacks?
Non-receipt claims benefit more from some kinds of proof than others. A signature from the customer at the delivery is by far your best bet for physical products. It's hard for anyone to argue with their own handwriting on the receipt.
GPS data from your driver can also work quite well - it nails down the exact location and time of the drop-off. Emails or messages where the customer admits they got the package should be saved immediately. Short messages like these can make or break your whole case.
IP address logs become your main shield with downloadable products and other online orders. They pin down right where and when the buyer accessed what they bought. You want to prove that the very customer received this exact order. Generic delivery photos won't help if they don't plainly show the right address or the package itself.
Your position gets stronger as you pull together more kinds of proof. A delivery photo along with GPS data and a signature gives you a far stronger defense than any single piece by itself - it's why delivery insurance makes sense for expensive items. Insured packages come with extra paperwork that gives you more ammo if a dispute pops up later.
Every text message, email and delivery update matters because you have to show that the delivery happened. Keep them organized and you just never know which small detail will tip the scales in your favor.
Can digital products and services get RG chargebacks?
Most merchants assume that selling their online products protects them from non-receipt chargebacks. This belief can land them in hot water. Customers can still claim they never received the ebook, online course or software download just as they can dispute a missing physical package. Unfortunately, there's no delivery driver or tracking number to wave around as proof of delivery.
If a buyer disputes an online order, you need other kinds of proof to defend the sale. Download logs are usually the strongest evidence. Pull up the IP numbers and timestamps that show when the customer actually accessed the product they're saying they never got. If the platform tracks usage data or login activity, that info can be super helpful too. Systems don't gather this data automatically and leaves merchants scrambling once a dispute hits.
Set up verification long before any problems pop up. Email confirmations are a decent starting point but on their own they don't win a chargeback case. A stronger plan is to ask customers to log into a password-protected account before they can access their order - and this leaves a trail if a customer later says they never got their product.
Some merchants take it one step farther and send confirmation emails that ask for an active reply from the buyer. Others will add two-thing authentication to confirm the person's identity before allowing access to the online product.
Should merchants always fight RG chargebacks or sometimes accept them?
Studying these disputes taught me that savvy merchants treat each case like a business call instead of just going after everything that comes their way. Fighting every chargeback without the strong evidence to back it up wastes time and actually damages your win rates with the card networks. Accept legitimate claims and refund obvious problem orders instead - it helps preserve customer relationships while dodging the extra chargeback fees that just add insult to injury.
A dollar threshold below which you don't bother with disputes makes plenty of sense from a cost perspective. Tracking these patterns over time provides real value because they show you if you have operational problems in your fulfillment process or if you're seeing fraudulent behavior from customers - this data is valuable for identifying patterns and making better business decisions down the road.
Prevention with better delivery and communication systems beats everything else. No matter how skilled you become at fighting or accepting chargebacks, you're still handling problems after they've already cost you money and effort. Put your resources into reliable shipping partners, automated tracking notifications and proactive customer service and you'll always get better returns than playing defense after disputes pop up. Prevention beats reacting every time.
Having the right tools and some expertise with these strategies can make the difference between losing money on every dispute and turning chargeback management into a competitive edge for your business. Merchants who look into this wind up saving thousands while their competitors continue losing money on disputes they could have avoided.
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