Buyers can dispute a paid transaction after the transaction request has been approved and before it is marked as “completed”. The dispute feature is a way for buyers to clearly communicate to providers that they are not happy with the way the transaction is handled.


  • Disputing a transaction doesn’t refund the payment. 
  • When a transaction is disputed the status of the transaction changes to canceled.
  • Both users can review each other after a dispute.
  • In the case Stripe was used the funds will be transferred to the seller (unless a refund is made). This will however be 85 days from when the seller accepted the transaction for the funds to be released to the seller.

If a buyer has disputed a transaction, it is up to the seller or the marketplace administrators to take action. In most cases, discussing with both users will help solve the situation. In some cases, a refund might be requested by the buyer. The refund needs to be processed manually.

It’s a good idea to cover this type situation in your “terms of use”, to have clear guidelines for these type of situations.

How to refund a transaction after a dispute

In some cases, buyers will ask for a refund after disputing a transaction. If Stripe was used, only the marketplace administrators can refund the transaction and if PayPal was used, only the seller can refund the transaction. 

Again, note that the dispute button does not automatically refund the payment.

You can find instructions and more details on how to refund an online payment in the articles below:

Can transactions be automatically refunded?

No, a transaction cannot be automatically refunded when a dispute is made; a refund must always be manually handled.  

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