Chargebacks Guide

Overview

Otter handles card payments for first party services such as:

• Otter POS
• Otter Online Ordering
• Otter Catering
• Otter Kiosks

Accepting card payments is a standard part of doing business, but it's important to be aware of the potential risks involved—particularly when it comes to fraud and chargebacks (also called "disputes")

Here are the two main types of risks:

• Fraudulent Transactions: In some cases, unauthorized individuals may attempt to use stolen or counterfeit cards to make purchases. These transactions can result in financial losses and may impact the trust customers place in a business.
• Chargebacks (Disputes): A chargeback happens when a customer disputes a transaction with their card issuer. When this occurs, the transaction amount may be reversed, which can lead to lost revenue for the business and additional processing fees.

By staying informed and following best practices, businesses can take steps to help reduce the impact of these risks.

Our work is designed to help prevent disputes. Businesses are liable for all accepted payments and disputes they receive. Otter does not assume liability for accepted payments.

Fraud Protection with Otter

Otter is designed with built-in fraud protection to help keep your business secure. Our system uses advanced technology alongside expert human oversight to identify and prevent potentially risky transactions before they happen.

At checkout, each payment is carefully reviewed using thousands of data points from a global network. This allows us to quickly spot unusual activity and take action. Behind the scenes, our dedicated fraud specialists monitor transactions in real time to help reduce risk and provide added peace of mind.

Chargeback Handling 

A chargeback (also known as a dispute) happens when a customer contacts their card issuer to challenge a transaction. This can occur for a variety of reasons, such as a misunderstanding about the purchase or concerns about fraud.

Here’s how chargebacks are handled on Otter:

• United States & Canada: Otter provides a built-in, no-cost chargeback management service. When a dispute is filed, our system automatically submits relevant documentation to help explain the transaction to the cardholder’s bank. This increases the chances of successfully resolving the dispute in your favor.
• Outside the US & Canada: Merchants are responsible for managing disputes directly. If a chargeback occurs, you’ll need to provide evidence that supports the legitimacy of the transaction. This typically includes order details, proof of delivery, and any relevant communication with the customer. Card networks enforce strict deadlines, so timely responses are important.

If a dispute is not resolved in your favor, the disputed amount is returned to the customer and deducted from your payout. 

By staying informed and responding promptly, you can improve your chances of successfully challenging disputes.

Chargeback outcomes are determined by card issuing banks, not by Otter.

FAQs

• Our dispute rate remains well below industry standard. While we can’t publicly share this number, we are consistently investing in this area in an effort to protect our customers globally.
• At this time Otter is responsible for disputes filed in the US & Canada; customers outside of US&C are required to fulfill dispute requirements within Business Manager
• We are continuously tuning our fraud prevention mechanisms, however, there could be isolated incidents where a restaurant observes higher volumes of fraud than others. In cases as such we encourage you to reach out to your account manager, or through our normal support channels with specific examples to ensure we can reach a timely resolution. 
  
  When accepting payments in person: In cases where you suspect fraud, or for transactions containing high dollar value items, we encourage you to validate the payment method used by matching it with a government issued ID. Additionally, if you experience numerous declined payments from the same card holder, it’s good practice to validate the payment method used as there is a very high chance it’s fraud.
• You will need to login to Otter Business Manager. Once logged in go to the Financials tab > Direct Orders > Disputes. From there you will see a list of disputes and dispute reversals (disputes won).
• You will need to login to Otter Business Manager. Once logged in go to the Financials tab > Direct Orders > Disputes.
• You will need to login to Otter Business Manager. Once logged in go to the Financials tab > Direct Orders > Disputes. From there you will see a list of disputes and dispute reversals (disputes won).

Updated April 21, 2025 21:33