Chargeback fees hit your bottom line hard. When you're choosing between Stripe vs Shopify Payments, understanding their dispute costs can save your business thousands of dollars annually. Both platforms charge you when customers dispute transactions, but their fee structures work differently.
Breaking Down Stripe Chargeback Fees
Stripe charges $15 per chargeback, regardless of the dispute outcome. This fee applies immediately when a customer initiates a dispute. You pay this fee even if you win the case and recover the transaction amount.
The platform processes chargebacks through its automated system, which means you'll receive notifications directly in your Stripe dashboard. You have approximately 7 to 10 days to respond with evidence. Missing this deadline forfeits your right to contest the chargeback.
Beyond the base fee, Stripe vs Shopify comparisons often overlook additional costs. Currency conversion adds extra charges for international disputes. Processing fees from the original transaction aren't refunded, adding another 2.9% plus 30 cents to your total loss.
Understanding Shopify Payments Dispute Costs
Shopify Payments takes a different approach with their chargeback fees. The platform charges between $15 to $25 depending on your country. US merchants pay $15, while Canadian merchants face $15 CAD, and UK merchants pay £10 GBP.
The Shopify vs Stripe debate gets interesting when you factor in Shopify's integrated ecosystem. Since Shopify Payments connects directly with your store's backend, you can manage disputes without switching between platforms. This integration speeds up evidence submission and tracking.
Shopify automatically pulls order details, shipping information, and customer communication history when you contest a dispute. This feature saves time but doesn't guarantee success. You still need compelling evidence to win your case.
Hidden Costs Beyond the Base Fees
The real expense of chargebacks extends past the advertised fees. Both Stripe vs Shopify Payments platforms don't refund your original processing fees. On a $100 transaction, you're already down $3.20 in processing costs before adding the chargeback fee.
Lost merchandise adds another layer of expense. Physical products rarely return after a successful chargeback. Digital goods and services represent complete losses since there's nothing to recover. These indirect costs often triple the total expense of each dispute.
Your merchant account also suffers from high chargeback ratios. Both platforms monitor your dispute rate closely. Exceeding 1% of your total transactions triggers additional scrutiny. Continued high rates lead to increased reserves, rolling reserves, or account termination.
Response Time and Evidence Requirements
Stripe gives merchants 7 to 10 days to submit chargeback evidence. The platform accepts various documentation types including receipts, shipping confirmations, and customer communications. Their interface allows bulk evidence uploads, streamlining the process for multiple disputes.
Shopify Payments provides similar timeframes but integrates evidence gathering more smoothly. The platform automatically compiles relevant transaction data from your store. You can add supplementary evidence like signed delivery confirmations or customer service logs directly through your admin panel.
The quality of your evidence determines your success rate. Both platforms require clear documentation proving the transaction's legitimacy. Winning rates hover around 20% to 30% for most merchants, though proper documentation can push this higher.
Platform-Specific Advantages
When comparing Stripe vs Shopify Payments for chargeback management, each platform offers unique benefits. Stripe's developer-friendly API allows custom integration with third-party chargeback prevention tools. You can automate evidence collection and submission through various services.
Shopify's advantage lies in its unified ecosystem. Everything from order management to dispute resolution happens in one place. This consolidation reduces the learning curve and simplifies staff training. Store owners without technical expertise find Shopify's approach more accessible.
The Shopify vs Stripe choice also affects your prevention options. Stripe partners with multiple chargeback alert services, giving you flexibility in choosing prevention tools. Shopify's closed system limits third-party integrations but offers built-in fraud analysis tools.
Calculating Your True Dispute Costs
Understanding the full financial impact requires careful calculation. Start with the base chargeback fee, then add the lost processing fees from the original transaction. Include the transaction amount if you lose the dispute. Factor in the product cost for physical goods.
Administrative time represents another expense. Gathering evidence, writing responses, and managing the dispute process consumes hours of work. Whether you handle disputes internally or outsource them, these labor costs accumulate quickly.
Consider the long-term implications too. High chargeback rates increase your processing fees on both platforms. Stripe and Shopify may require reserves holding 10% to 30% of your revenue. These funds remain locked for months, affecting your cash flow.
Conclusion
Choosing between Stripe vs Shopify Payments for chargeback management involves weighing multiple factors beyond the base fees. While both charge $15 for US merchants, the total cost includes processing fees, lost merchandise, and administrative expenses. Stripe offers more flexibility through API integrations and third-party tool compatibility. Shopify Payments provides a simpler, integrated solution that works seamlessly with your store. Your business size, technical resources, and transaction volume should guide your decision. Remember that preventing chargebacks costs far less than fighting them, regardless of which platform you choose.
FAQ: Stripe vs Shopify Payments Fee Breakdown
Which platform charges lower chargeback fees?
Both Stripe and Shopify Payments charge $15 per chargeback for US merchants. The fee structure remains similar, but total costs depend on your dispute volume and success rate defending cases.
Can I switch between Stripe and Shopify Payments easily?
Switching payment processors requires updating your integration and migrating customer payment data. The process typically takes several days and may temporarily affect your checkout flow during the transition period.
Do I get the chargeback fee back if I win the dispute?
No, neither Stripe nor Shopify Payments refunds the chargeback fee even when you successfully defend against a dispute. The fee covers their administrative costs for processing the chargeback regardless of outcome.
How long do I have to respond to a chargeback?
Both platforms typically provide 7 to 10 days to submit your evidence after receiving a chargeback notification. Missing this deadline means automatically losing the dispute and forfeiting the transaction amount.
What evidence helps win chargeback disputes?
Strong evidence includes shipping tracking showing delivery, customer signatures, IP address matches, and communication logs proving customer acknowledgment. Clear documentation of your refund policy and customer acceptance also strengthens your case.
Shield Your Revenue with Chargeblast's Alert System
Running a business means you can't afford to lose money to preventable chargebacks. Chargeblast stops disputes before they damage your merchant account. Our alert network catches disputes early, giving you time to process refunds instead of eating chargeback fees. You'll keep your dispute ratio low while protecting your processing privileges. Ready to cut your chargeback costs? Book a demo today!
