EBT Chargebacks

⚠️

EBT Chargeback Handling

Forage EBT chargeback handling is still in development. Documentation may change.

Thanks for your patience and feedback.

An EBT chargeback is a funds reversal for a purchase transaction mandated by an EBT Issuer after an EBT Cardholder successfully disputes a charge.

At the highest level, a Cardholder initiates a dispute with their State Processor. The Merchant has the opportunity to provide evidence to counter the dispute. If the State Processor decides the dispute in favor of the Cardholder, then the funds are returned to their card in a chargeback.

Continue reading this guide for more details on the chargeback process.

How EBT disputes lead to chargebacks

1. An EBT Cardholder contacts the State Processor in the State that issued their benefit card to dispute a charge. In the dispute timeline, this counts as Day One.

2. The State Processor opens a claim and notifies Forage within one business day.

3. No later than one calendar day after receiving the notice, Forage sends the Merchant a Dispute File, a report that contains a list of disputed transactions received by Forage from the EBT Issuer and/or the relevant merchant in the preceding 24 hours. The Dispute File lists information about each disputed transaction in the previously agreed upon form, format, and frequency.

4. To deny the dispute, the Merchant (or Platform, if permitted) sends Forage the required denial documents:

   • An itemized receipt. This receipt must include all items in the order, and amounts that add up to the total.
   • An approved transaction receipt. This receipt must include the last four (4) digits of the cardholder number, the transaction date, time, and amount.

   The Merchant must provide the documents within seven calendar days. This gives Forage a buffer to make the State Processor's nine day deadline. If the ninth day falls on a weekend or holiday, then the Merchant needs to get the documents to Forage by the eighth day.

   ⚠️

   Skipping Dispute Response

   If the Merchant/Platform skips this step, the dispute is decided in the Cardholder's favor.

   The dispute is approved and the Merchant/Platform must return funds to the Cardholder.

5. Forage sends the denial documents to the State Processor.

6. Within one calendar day, Forage and the State Processor review the documents and make a decision either in favor of the Cardholder or in favor of the Merchant/Platform.

When a Cardholder wins a dispute

• Funds are returned to the Cardholder as a chargeback.
• Every 30 days, Forage reviews all deductions that require merchant settlement.
• Forage deducts any applicable chargeback amounts from a Merchant/Platform's next settlement. Forage notes each distinct chargeback transaction as a single line item.
• In the edge case that the merchant's settlement is insufficient to cover the chargeback deductions, Forage deducts the chargebacks from the next upcoming settlement once there are sufficient funds.

⚠️

Deduction Review Timing

Forage's deduction reviews may not follow a strict 30-day schedule and can change based on chargeback volume.

When a Merchant/Platform wins a dispute

• The chargeback is denied. The cardholder does not receive any funds from the merchant.
• No further action is required.

What's in a Dispute File

In addition to transaction-level details, a Dispute File includes the following dispute-specific information:

Possible dispute_reason_code and dispute_reason_text values

How to read a Dispute File

The Conclusion column in the following table describes how to interpret each example combination of dispute_status, evidence_provided, and dispute_resolution.

Note that the Conclusion is not included in an actual Dispute File.

How Chargeback Data is Reflected in Reports

Forage includes EBT chargeback data across all report delivery methods: API, SFTP, and Dashboard.

👉See Reporting Overview for more details.

API and SFTP Reporting

For merchants who retrieve reports via API (JSON) or receive scheduled CSVs via SFTP. Both methods provide similar field structures; however, specific fields, such as total_chargebacks, may not be available for all merchant setups.

• Payout Report: The total_chargebacks field shows the total USD amount of chargebacks included in the payout period. This is distinct from total_refunds.

  ⚠️

  Direct Payouts Only

  This field is only accessible to merchants with direct payout setups. It is not included for merchants using a charge-to-platform configuration.

• Payout Transaction Report and Transaction Report (API) or Transaction Log (SFTP, if enabled): Chargebacks appear as individual transactions with transaction_type = Chargeback.

  • Key fields include transaction_amount, chargeback_id, and either merchant_net_settlement or platform_net_settlement for net adjustments.

Dashboard reporting

For merchants who use the Forage Dashboard to view and export transaction and payout data.

When users request CSV exports from the Dashboard:

• Chargebacks appear as individual transactions marked with transaction_type = Chargeback.
• Totals include chargeback amounts for the period, often visible in exported summaries.
• Dashboard users can apply filters or view the Transactions view to see or export chargeback entries.

---

📘

Notes

• Merchants without API access or SFTP delivery can still see all chargeback data via the Dashboard by exporting transaction CSVs.
• total_chargebacks is not included in total_refunds; it's a separate field.