In the inquiry lifecycle, if evidence is insufficient it will likely escalate to a chargeback. Which statement is correct?

In the inquiry lifecycle, if evidence is insufficient it will likely escalate to a chargeback. Which statement is correct?

• A. In the inquiry lifecycle, if evidence is insufficient it will likely escalate to a chargeback
• B. In the inquiry lifecycle, Stripe automatically resolves the dispute with no merchant action
• C. In the inquiry lifecycle, the merchant can ignore the dispute without consequence
• D. In the inquiry lifecycle, the customer is immediately refunded

Answer: (A)

In this phase of a dispute, the card issuer asks the merchant for evidence to support the charge. If the provided evidence is not strong enough to counter the customer’s claim, the dispute will typically move from the inquiry stage to a chargeback—the issuer reverses the payment and the funds are returned to the cardholder. This is why the statement is correct: insufficient evidence tends to lead to a formal reversal rather than a resolution in the merchant’s favor. Think about what happens next: the merchant has a chance to respond with compelling evidence to try to overturn the dispute, but if the evidence remains inadequate, the chargeback stands. This is not something Stripe does automatically without merchant input, and ignoring the dispute can lead to penalties and a chargeback anyway. A refund to the customer is not automatic in this process; refunds are separate and only occur if the merchant initiates one or the dispute is resolved in the cardholder’s favor.

In this phase of a dispute, the card issuer asks the merchant for evidence to support the charge. If the provided evidence is not strong enough to counter the customer’s claim, the dispute will typically move from the inquiry stage to a chargeback—the issuer reverses the payment and the funds are returned to the cardholder. This is why the statement is correct: insufficient evidence tends to lead to a formal reversal rather than a resolution in the merchant’s favor.

Think about what happens next: the merchant has a chance to respond with compelling evidence to try to overturn the dispute, but if the evidence remains inadequate, the chargeback stands. This is not something Stripe does automatically without merchant input, and ignoring the dispute can lead to penalties and a chargeback anyway. A refund to the customer is not automatic in this process; refunds are separate and only occur if the merchant initiates one or the dispute is resolved in the cardholder’s favor.