The Chargeback Document Management System (CDYS) is a system developed by BKM that is used to resolve customer disputes relating to card payment transactions carried out among BKM members. It links the supporting documents that must be shared for processes such as > Copy Request, > Chargeback, > Representment, > Second Chargeback, > Pre-Arbitration, > Arbitration, > Pre-Compliance, > Compliance to the related Domestic Clearing and Settlement System records, and ensures these documents are shared with the relevant members and with BKM.
How does the dispute process proceed?
When a cardholder disputes a transaction, the process moves forward in stages between the issuing bank and the merchant's acquiring bank:
- Copy request: The issuing bank requests the transaction document (receipt, invoice, contract, etc.) from the merchant's acquiring bank.
- Chargeback: The issuing bank reverses the transaction amount back to the merchant's acquiring bank on the grounds of the dispute.
- Representment: The merchant's acquiring bank contests the dispute with documents showing that the transaction is valid.
- Second chargeback: If the issuing bank does not find the submitted documents sufficient, it maintains its dispute.
- Arbitration and compliance: If the parties cannot reach agreement, the dispute is escalated to a higher stage within the framework of the rules for a final decision.
The benefits CDYS provides
At every stage, documents must be shared between the parties. CDYS ensures these documents are transmitted from a single center, matched with the related clearing record. This eliminates correspondence conducted between banks by email or physical paperwork, prevents confusion about which transaction a document relates to, and keeps every step of the process on record.
Its importance for merchants
Merchants do not use CDYS directly, but they are directly affected by the process. When their bank requests a document, the merchant must submit the requested documents within the specified period. If the document cannot be submitted, the dispute will most likely be resolved in the cardholder's favor, and the transaction amount will be deducted from the merchant's account.
