Respond to disputes

The lifecycle of Klarna disputes and how to respond to them.

Note

This guide is specific to Klarna payment disputes. Learn how card disputes work.

A dispute occurs when the Klarna customer files a complaint or return request for a specific order using the Klarna consumer app. Customers have up to 180 calendar days to file a dispute from the date of capture.

These complaints and return requests correspond to specific reason codes that Stripe shares back with you. When someone files a Klarna dispute, the process varies slightly by reason code, but typically follows a standard pattern.

Dispute-raising exceptions

In some exceptional cases, Klarna must raise a dispute outside of the dispute limitations after 180 days of transaction. These exceptions include fraudulent disputes reported by the customers, legal claims raised through an external authority, local legal consumer protection rules, and debt collection.

Comparison to card disputes

There are a few key similarities and differences between how Klarna and card disputes work.

	Card disputes	Klarna disputes
Enquiry support	Select card networks support enquiries, also known as a “retrieval” or “request for information”.	All Klarna disputes, except for fraudulent disputes start as enquiries. Unlike cards, businesses aren’t expected to submit evidence at this stage and are expected to resolve the issue directly with the customer.
Responding to disputes	Businesses can use the Stripe Dashboard or Disputes API to manage and respond to disputes.	Same as cards.
Dispute fees	There are separate fees for receiving a dispute, in addition to countering a dispute. Dispute fees are assessed when the dispute is created and apply regardless of whether you ultimately win or lose the dispute.	There is only a single fee for losing a dispute. Dispute fees are assessed when the dispute is created, but are reversed if you ultimately win the dispute.
Partial disputes	Partial disputes are supported.	Same as cards.
Credit not processed Stripe dispute category	This dispute category can refer to several card network reason codes, although the most common reason is when a customer has made a return and hasn’t yet received a refund.	For Klarna, this dispute category refers to two distinct scenarios, although both reasons share the same reason code. Return: The most common scenario where a customer requests to initiate a return using the Klarna app. Credit not processed: The customer has already completed the return but hasn’t yet received a refund.

Enquiries

Enquiry disputes are an opportunity to resolve a customer’s issue before the dispute escalates to a chargeback and carries a fee. Stripe notifies you of an enquiry as soon as Klarna opens one. Enquiry creation is triggered by the customer taking action on the Klarna app, either by filing a complaint or requesting to return the purchase. When a customer files an enquiry, Klarna pauses any outstanding repayments from the customer until the dispute is resolved.

Almost all Klarna disputes begin as enquiry disputes, which have a 21 calendar day timeframe before they are escalated. Among the exceptions documented by Klarna are disputes raised because of fraudulent transactions, which escalate immediately. Klarna doesn’t accept evidence during this stage.

The intent of an enquiry is to give you early notice that the customer has an issue with the order so that you can proactively address the customer’s concern and potentially avoid chargeback disputes. During this stage, you can perform one of the following actions:

Contact your customer to understand the reason for raising the dispute and try to mutually find a resolution before the enquiry escalates to a chargeback. Customers have the ability to withdraw their enquiry using the Klarna app.
Accept the dispute by issuing a refund of the full disputed amount. Refunding during the enquiry dispute period avoids a dispute fee.
Allow the dispute to escalate. If you ignore the enquiry or are unable to resolve the issue, it will automatically escalate to a chargeback. At this point you can submit evidence to challenge the dispute.

Responding to return enquiries

Customers paying with Klarna use enquiry disputes as a means to pause repayments while they’re in the process of completing a return for physical goods purchases. Klarna allows customers to file an enquiry and pause repayments before they’ve completed their return, but ask customers to provide proof of return, such as the return tracking ID.

Stripe only notifies you of a return enquiry when a customer has provided the necessary information. However, if you’re using Stripe’s Disputes API, Stripe notifies you as soon as a customer files an enquiry, even if the return hasn’t yet been completed.

If you receive an enquiry dispute with the Return Klarna dispute code, make sure to handle these appropriately:

Click into the dispute object view in your Stripe Dashboard for details on the return dispute.
Select Issuer evidence. This provides the return tracking details.
After you’ve verified that the return is in transit or has already been returned to you, process a refund within the 21-day enquiry period.

Chargeback disputes

If an enquiry dispute remains unresolved after the 21 calendar day timeframe, the dispute automatically escalates to a chargeback dispute. At this point, Stripe withholds the disputed funds and the associated dispute fee from your account for this payment until the dispute is resolved.

During the chargeback dispute stage, you can counter disputes by submitting evidence to Klarna, either in the Dashboard or with the API. You need to submit evidence by the deadline displayed in the Dashboard or evidence_due_by for API users.

If you counter the dispute by submitting evidence, Klarna evaluates your response to decide the outcome.

If you win the dispute, Stripe releases the withheld funds to your account, including the associated dispute fee.
If you lose the dispute, Stripe debits the withheld funds, including the associated dispute fee. Klarna then returns the disputed amount to the customer.

Submit evidence for chargeback disputes

You can only submit evidence after a dispute gets escalated to a chargeback. Use the Dashboard or the API to submit evidence against a chargeback dispute. If you fail to submit evidence, Klarna rules the dispute in favour of the customer.

Businesses have 12 calendar days from chargeback escalation to provide evidence, except for fraud disputes, which have a 5 day timeframe.

It’s only possible to submit a single round of evidence for Klarna disputes. Therefore, it’s important to ensure that all necessary evidence is gathered and submitted during the evidence submission window. Below we provide recommended guidelines based on dispute reasons below. For additional best practices, refer to Klarna’s guide.

Stripe dispute reason	Klarna dispute reason	Suggested evidence fields	Description
Product not received	Goods not received	shipping_tracking_number shipping_carrier shipping_date customer_communication	All shipping related information
Credit not processed	Return	uncategorized_file refund_refusal_explanation
Duplicate	Already paid	uncategorized_file customer_communication	Supporting evidence for your case in an attachment Any communication with the customer
Fraudulent	Unauthorised	customer_communication shipping_tracking_number shipping_address shipping_documentation	All shipping related information Communication with the customer
General	Incorrect invoice High risk order	shipping_documentation
Product unacceptable	Faulty goods	customer_communication

Use the Dashboard or the API to submit evidence against a chargeback dispute. You can’t submit evidence for enquiry disputes.

Navigate to the Disputes Dashboard, and click the Needs Response tab.
Click the disputed payment. If you want to counter the dispute, click Counter dispute.
Select the reason why you should win the dispute, and click Next.
Enter and attach all the applicable supporting evidence. The recommended label indicates the best documents for the type of dispute.
After entering all the evidence, verify the information is correct by selecting the checkbox.
Click Submit Evidence.

Submit evidence on time

If you fail to submit evidence, Klarna rules the dispute in favour of the customer. See Respond to disputes for more information.

Alternatively, you can accept a dispute loss from the Disputes Dashboard by clicking Accept Dispute.

Guidelines

Follow these guidelines to submit the most relevant evidence for both Dashboard and API disputes.

Create test disputes

You can simulate dispute creation by creating a transaction in a sandbox using the following email addresses and phone numbers in the given Klarna checkout region. A dispute automatically opens on the transaction. You can submit evidence on the dispute, but you can’t simulate the final dispute outcome in a testing environment.

Below, we have specially selected test data for the currently supported customer countries.

Stripe dispute reason	Klarna dispute reason	Email	Phone number
Credit not processed	Return	`customer+disputed-return@email.au`	`+61491574118`
Product not received	Goods not received	`customer+disputed-goods_not_received@email.au`	`+61491574632`
Duplicate	Already paid	`customer+disputed-already_paid@email.au`	`+61491575254`
Product unacceptable	Faulty goods	`customer+disputed-faulty_goods@email.au`	`+61491575789`
General	Incorrect invoice	`customer+disputed-incorrect_invoice@email.au`	`+61491575789`
General	High risk order	`customer+disputed-high_risk_order@email.au`	`+61491576801`
Fraudulent	Unauthorised purchase	`customer+disputed-unauthorized_purchase@email.au`	`+61491577426`

Dispute API

A Dispute object contains a dispute type and Klarna dispute reason. These parameters are useful for countering a dispute.

Type

The Status parameter indicates the dispute type. The following table explains the dispute status and the state of the dispute.

Status	Dispute type	Description
`warning_needs_response`	Enquiry	The enquiry is open and the business can issue a refund.
`warning_closed`	Enquiry	The enquiry is closed.
`needs_response`	Chargeback	The chargeback is open and the business can submit evidence.
`under_review`	Chargeback	The chargeback is open and the evidence is submitted to Klarna.
`lost`	Chargeback	The chargeback is closed and the business lost the dispute.
`won`	Chargeback	The Chargeback is closed and the business won the dispute.

Klarna reason

The Klarna reason is mapped to Stripe dispute reason and displayed in the Dashboard as Network Reason Code.

The Stripe reason is available in the Dispute object as reason and the Klarna reason is available in payment_method_details.klarna.reason_code. The data is available in the API and webhook.