Pre-Dispute Alert

A pre-dispute alert is an early warning that eligible fraud or dispute activity has been detected on a transaction, delivered to the merchant before a formal chargeback is filed. It gives the merchant a chance to investigate the case and, where appropriate, resolve it — often by issuing a refund — inside a limited window, so the dispute never escalates into a chargeback with its associated fees and ratio impact.

Pre-dispute alerts are made possible by networks that connect issuers and merchants, such as the Verifi and Ethoca networks. Coverage is tied to issuer participation, merchant enrollment, geography, and case eligibility, so alerts represent an important but partial view of a merchant's total dispute activity. They complement, rather than replace, a merchant's broader prevention and monitoring efforts.

The value of an alert lies in what the merchant does with it. Because the response window is short, the practical challenge is speed and context: matching each alert to the underlying gateway, order, and refund records so the merchant can decide quickly and correctly. Treating alerts as decisions to be reviewed — not automatic refunds — lets merchants prevent avoidable losses while still defending the transactions worth keeping. Our guide to chargeback alerts covers how these programs fit together.

Pre-dispute alerts open a window to resolve eligible cases before they become chargebacks, which carry fees and count against a merchant's dispute ratios. Acting inside that window can prevent avoidable losses and help keep ratios healthy.

Because timing is short, connecting alerts to transaction data quickly is what makes them valuable.

When eligible fraud or dispute activity is detected, an alert is delivered to the enrolled merchant. The merchant can then investigate, issue a refund, or take another appropriate action within the allowed timeframe to head off a chargeback.

Effective use depends on matching each alert to the underlying transaction so the right decision can be made fast.

Not every dispute creates an alert, and not every alert should automatically result in a refund. Alerts cover only eligible activity from participating networks and issuers, so merchants still face disputes that arrive with no warning. And because a reflexive refund on every alert can give away revenue on transactions the merchant could defend, each alert should be reviewed against the transaction facts before acting.