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RM: Quality Discrepancy
Discover’s RM quality discrepancy code is a problem for merchants because it can affect them where they’re most vulnerable (their profit margins and account health) this chargeback reason code gets triggered when cardholders claim that the products or services they received didn’t meet their expectations and it creates one of the most subjective dispute categories in payment processing.
RM disputes come from legitimate transactions where the customers actually received what they ordered. Customers claim that the quality just wasn’t what they were expecting. These situations include items that got damaged during shipping, products that don’t quite match their online descriptions or services that don’t meet what was promised. These disputes are especially hard to work with since their subjective nature means “quality” can depend on who’s judging and what they expected.
Merchants facing RM disputes soon see that the lost revenue is only part of their underlying problems. Every dispute that comes in pushes their chargeback ratio higher and payment processors are pretty harsh when those numbers start climbing. Penalty fees hit first and then they raise the processing costs on each transaction and in extreme cases the processor can shut down their merchant account entirely. Most businesses just can’t run without payment processing capabilities – it’s almost like shutting down their entire operation.
Root cause analysis works best for quality problems – it helps businesses find the true source of their problems and fix it permanently.
How It Works
Cardholders who have a problem with something they purchased can’t just jump straight into a dispute. Discover actually asks them to try resolving the problem with you first and gives you a chance to fix the problem before it turns into a chargeback. Most customers will reach out through email or phone to talk about what went wrong with their order.
If those conversations don’t go anywhere, the customer has 120 days from the transaction date to file a dispute with their card company. It can become much harder when they claim that you sold them counterfeit goods or completely misled them about what they were buying. In those cases they get 540 days to dispute the charge – that’s over a year and a half after the original sale happened.
Once Discover gets the dispute they’ll contact you instantly. You’re going to need to pull together some proof that shows that your product was just what you described in your listing. Quality disputes are tough to fight because everyone has different standards for what they see as okay – something that really bothers one customer could definitely be fine with the next person who buys the same item.
Quality disputes are especially frustrating to fight because of this. Even with strong paperwork, you might still lose because the customer believes the quality was poor. Some customers also know how to work the system and will claim quality problems even when the product matches what they ordered. They know it’s tough for merchants to prove otherwise.
How it Affects Chargeback Prevention
RM disputes from customers affect your chargeback ratio in a completely different way than fraud claims do. Quality disputes like these still count against your merchant account just like any common chargeback would. Most merchants can actually head off the majority of these disputes before they ever happen and that makes them different.
Your payment processor is always watching your chargeback ratio. Once you cross whatever threshold that they’ve set for your account then you’ll get hit with higher processing rates along with much stricter review policies. Some processors will even freeze your account completely or drop you as a client if that ratio stays high for too long.
Each RM dispute ends up costing you the original product revenue along with a chargeback fee that usually falls somewhere between $20 and $100. If your chargeback ratio climbs above one percent, your processor might bump your processing rates by half a percentage point or more. On a million dollars in annual sales that means an extra five thousand dollars you’ll pay each year just to process credit cards.
Fortunately RM disputes respond to prevention strategies that just don’t work for fraud cases. Complete product descriptions and sharp photos help customers see what they’re buying. Quality control processes catch the defects before they ship out to customers who would otherwise file disputes. Fast response times can manage most customer issues before they escalate into disputes where customers call their bank. These prevention steps take a bit of work in advance yet cost far less than the disputes themselves.
Example Scenarios
A customer receives a laptop with a completely cracked screen and this type of dispute seems like it should be simple to resolve. Disputes can get messy though. Your customer swears that the laptop showed up broken. Meanwhile your warehouse team is convinced that they packaged everything with care. Without any photos taken before shipment and without signature confirmation at delivery, you’re stuck trying to defend your business with nothing more than your word against theirs. Tracking information shows “delivered” plain as day but that paperwork won’t help prove what shape the laptop was in when it left your place.
Sometimes the problem isn’t damage – it’s product substitution and these accidents give you just as big a headache for your business. A bakery accidentally ships honey-glazed pastries to a customer who specifically ordered the maple syrup kind. Both products cost the very same and look almost identical in the photos on your website. You might figure that this small switch shouldn’t be a big deal since either flavor is a premium option anyway. Unfortunately for the customer who needed those maple syrup pastries for their Canadian-themed birthday party, this seemingly minor mix-up has completely ruined the event. Even after agreeing to rush-ship the correct order at no extra charge they’ve likely already filed the chargeback.
Service-based businesses face their own set of hurdles. A spa sells a deluxe treatment package advertised as about ninety minutes of total service time. Equipment problems during the appointment mean the session only lasts about seventy minutes instead. Your customer still receives the treatments listed in the package description. Yet they feel shortchanged on the relaxation time they expected. Your complete staff records show that each service was completed just as promised but the customer has timestamps from their parking receipt that prove the shorter visit. Situations like this will escalate faster when customer expectations and the experience delivered don’t line up.
Requirements and Timeframes
RM disputes come with important deadlines you need to know about. Most disputes have to be filed within 120 days of the original transaction date. Counterfeit goods claims or situations where cardholders say they received something completely different from what they actually ordered are tougher – in cases like that, the window stretches all the way out to 540 days, almost a year and a half.
You need to keep your records around for much longer than you might think. Your product descriptions, shipping confirmations and customer emails can’t just disappear after a few months. Plan to hold onto everything for that full 540-day period just to be safe.
Most card networks make cardholders contact you directly first before they can file a dispute. They have to give you a fair chance to fix whatever problem they’re having and it’s great news because it means you can solve problems before they turn into expensive chargebacks. Your customer service team should document conversations whenever they happen.
Once you receive that official notification about an RM dispute, the clock starts ticking instantly. You usually have somewhere between 7 to 10 days to respond with your evidence. Miss that deadline and you automatically lose the dispute – no exceptions, no extensions and no second opportunities.
Make sure that your response covers all the important areas. Include full product descriptions that match what you actually sent to the customer. Save all your tracking numbers and delivery confirmations. Hold onto any quality control records that show you actually checked the products before they shipped out. Customer service conversations matter too, especially if the customer seemed happy with their order at the time!
Frequently Asked Questions
How can I prove the product quality met expectations?
You're going to need strong documentation to fight back and win against customer chargebacks claiming quality problems with their order. Your most important evidence actually starts building up before you even ship out the product. Photos of the item right before you pack it work well. Photos from a few angles and some close-ups of any small features that might matter later on help too. These photos become your main proof that the product left your warehouse in perfect condition.
Delivery confirmation with a signature requirement helps quite a bit too - it shows that the customer actually received the package and had a chance to refuse it if something looked obviously wrong. Most merchants miss this part though and forget to save their customer communication history.
Every single email or message where a customer says they're happy with their order ends up mattering quite a bit. Screenshots of positive reviews before they disappear from your site work well. Messages where customers acknowledge that they got their order without complaints also help. These small pieces of evidence can build into a pretty strong defense later on.
Quality control records matter when the bank reviews your chargeback case. Documenting your inspection process and storing those reports in an organized and easy-to-find folder helps. Recording product checks with dates before they go out matters. Banks want to see that you have quality standards in place and that you follow them every time.
Building these documentation habits into your operations works much better than rushing around looking for evidence after a chargeback already shows up in your inbox. A strong documentation process that becomes a normal part of how you run your business works much better.
What's the difference between RM disputes and fraud-related chargebacks?
Customers who file RM disputes are telling you that they got the very item that they ordered, yet somehow it just wasn't enough for them. Maybe the product broke way too fast, or maybe it didn't work the way that they expected it based on your description. It's very different from fraud disputes where customers claim that they never placed the order at all.
Your response to these two types of disputes matters quite a bit and the strategies are very different. Your main job with RM disputes is to prove that your product quality was actually fine when it left your warehouse. You might need to pull up quality-control records, warranty facts or even manufacturing specs. With fraud disputes, you need to show something else entirely - you need to show that the customer actually authorized the transaction in the first place.
RM disputes are especially tough because of one big problem - quality is almost always subjective. That turns into a giant headache for merchants. One customer might think that a shirt feels cheap and flimsy but another customer loves that very same fabric. You can't prove that someone's personal opinion is wrong. With fraud disputes the evidence is usually clearer - you either have their signature and authorization or you don't. It either happened through legitimate channels or it didn't.
This subjectivity makes RM disputes especially frustrating to fight, and to be honest it's my least favorite type of chargeback. You could have perfect quality-control processes and still lose the dispute because the customer legitimately believes that your product fell short of what they expected. There's hardly ever an easy answer like the one you get with fraud cases where you can point to evidence and say, "Here's proof that the customer authorized this order.
How quickly must I respond to an RM chargeback notification?
Your payment processor will send you a dispute notification and give you roughly 10 to 20 days to respond. Timeframes can depend on the dispute type and on your processor. Miss the deadline and you lose the case automatically - no exceptions.
That's why you want your dispute-management system ready long before any cases land on your desk. Pick a teammate now who will manage these problems as they come in. Figure out where you'll store the transaction records and customer messages so you can pull them up faster later. You can build a few response-letter templates ahead to save yourself from writing everything from scratch each time a dispute comes in.
Send your response quickly to improve your odds of winning. Dispute analysts sift through hundreds of cases every week and they like merchants who turn in evidence early. Get your paperwork in fast to show them that you treat disputes as a priority and have your records in order.
Don't wait until day 19 to hit submit. Tech glitches pop up and systems crash and your file failing to upload on the last day means that you won't get another chance. Give yourself at least a three-day cushion before the deadline.
Most merchants learn this lesson the hard way after losing their first dispute on a technicality.
Can customers file RM disputes for digital products or services?
Online consumer protection has been changing quite a bit over the past few years and these changes are putting more power directly into the hands of customers who want to challenge merchants when products fall short of what was promised. New legislation like the EU's proposed Online Fairness Act and the UK's recent Online Markets, Competition and Consumers Act are changing the whole game. Consumers now have stronger rights and more direct pathways to file disputes about quality problems. Running an online business means you need to be much better prepared than you've ever been before to back up your product quality and records of everything that you deliver to your customers.
These developments are fascinating because they're finally starting to create some balance between big corporations and consumers who shop online. Customers have been stuck for decades in this frustrating position where they had no recourse when products didn't match the marketing claims or the full descriptions they saw before making their order. These new laws are actually beginning to change that whole situation and give consumers some actual pull for the first time in years.
Online merchants are now up against challenges that traditional physical product sellers never have to worry about. Software that doesn't perform the way it was advertised, online courses that are missing the content that was promised on the sales page, or subscription services with promised features that just don't work right - these quality problems can now trigger disputes way easier than before. Proving that you actually delivered the quality becomes the real challenge because your product exists only in the web - it's part of why keeping access logs, feature documentation and full customer usage data has become essential for protecting your business.
Staying ahead of these regulatory changes and knowing how they affect your own business model will be the main thing that helps you find your way through this new environment successfully.
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