16 Aug 2023

This year, card servicing at CBS B2 has expanded with a subsystem for processing disputed transactions.  

This innovative module allows banks to notably expedite the handling of applications concerning erroneous and fraudulent card transactions, saving valuable time for its experts and enhancing the overall customer experience for cardholders.  

Long-Term Effects of Automation in Disputed Transactions’ Processing 

The share of non-cash payments using cards is constantly growing. In 2022 alone, the number of cards issued in Ukraine increased by 20%, as reported by the National Bank of Ukraine. This trend aligns with worldwide patterns. Accordingly, the number of disputed transactions that require fast and accurate processing is also increasing.  

For banks, this means a growing need to automate all the steps that CBS can perform without manual intervention. This will save specialists' time on manual document entry and help direct human resources where they are most needed. 

Minimizing reputational risks and strengthening customer loyalty is another desirable long-term effect of implementing the Disputed Transactions subsystem in a banking institution. The quality of processing applications for fraudulent and erroneous transactions has a significant impact on customer satisfaction. Any delays and errors in processing these applications create significant reputational risks for the bank. 

A customer who has already been irritated by a terminal error or ATM malfunction will be inclined to leave negative review about the bank or switch to another bank if their problem is not resolved quickly and professionally. On the other hand, timely assistance in a non-standard situation can significantly increase customer’s loyalty. 

New Module: Immediate and Tangible Benefits 

The new card subsystem "Disputed Transactions" from CS was developed taking into account the practical experience of banking specialists. Any institution that operates on CBS B2 will be able to easily integrate it into its workflows. The module can be adapted to individual bank requests, and its functionality can be expanded as needed. 

The "Disputed Transactions" subsystem is an integral part of CBS B2. Each claim of missing funds and each filed dispute is processed by the banking system, preserving all necessary data for each such transaction in a unified database. Every involved specialist, upon opening the disputed transaction form, can review all related applications, receipts, reports, conclusions, and other documents pertaining to the case at any time. 

All accounting journal entries for disputed transactions are generated directly within CBS and are synchronized with the customer's card account. It minimizes the timespan required to credit funds to the card account if the compensation request was approved. 

This way, all bank employees address disputed transaction matters within a cohesive and user-friendly system. Transactions are executed automatically, while accountable team members are designated based on the disputed transaction's status – from the initiation of a new application to the conclusive resolution of the matter. Consequently, bank customers experience swift and efficient responsiveness to their complaints. 

The Most Compelling Features of the "Disputed Transactions" Module 

With decades of experience in software development for banks, the CS team is well-versed in our customers' needs. In this subsystem, we've accounted for diverse scenarios in processing disputed transactions, ensuring user-friendly accessibility for all engaged specialists. We've also established mechanisms for interactions with regulators and considered the necessity of harmonizing automation with manual decision-making. 

Here are the most compelling features of “Disputed Transactions” module: 

The ability to process different kinds of disputable transactions. Disputes most often arise with card transactions, but there are other instances when the bank must process a customer's ticket. Whether it is an erroneous charge in a supermarket, technical problems with cash withdrawals from an ATM, a problem with cash-in acceptance, or a fraudulent activity – all disputed transactions can be processed within CBS B2 with this special module. 

Different methods of registering a disputed transaction report. Whenever feasible, the system autonomously fetches necessary data to generate a new entry — be it from a previously cleared transaction or via an advice request when the transaction is pending reflection in CBS but visible online due to mirroring from the processing center. Such automated approach notably expedites dispute processing. Nevertheless, our module also accommodates manual input. For instance, if a cash deposit has been accepted by an ATM but not credited to the account, the operator can manually generate a new entry as per the client's request. 

Configuring accounting models for various compensation types. In the realm of banking, the decision to provide compensation for disputed transactions typically involves a manual assessment by a designated expert. That’s a normal banking practice. Yet, for all that can be automated, we've entrusted the task to our automated system. Our "Disputed Transactions" module empowers you to configure accounting entries tailored to each compensation type: be it partial, complete, covered by the bank, or involving an insurance company. Upon the specialist's command, the system initiates automatic payments, archives pertinent documentation in the data repository, and generates comprehensive reports. 

Recording the amount of a disputed transaction as a merchant's debt with a subsequent payment covering this debt. This compensation payout model should be highlighted as a distinct feature due to its exceptional utility. Thanks to this model, the return of erroneously debited funds to the customer occurs promptly, significantly saving the time of not only bank employees but also the merchant. There's no longer a need for numerous repeated inquiries to the merchant, tracking the status of their transactions, and manually processing these data. Instead, the merchant commits to settling the debt through future payments from other customers, greatly streamlining the process and reducing the number of administrative steps. 

Simplification of accounting and reporting on fraudulent transactions. Regulatory bodies across different countries, including the National Bank of Ukraine, mandate that banks furnish lists of fraudulent transactions for further analysis. Our automated subsystem for disputed transactions management automatically generates these lists, thereby streamlining reporting obligations. This not only ensures precise and timely reporting but also enhances interactions with regulatory authorities. 

The Bottom Line 

The implementation of the "Disputed Transactions" subsystem does not demand significant efforts or a fundamental shift in the bank's approach to handling customer claims regarding payment errors or fraudulent activities. The system effectively automates tasks that can be streamlined, ensuring accurate form submissions and automated transactions aligned with specialists' decisions on compensations for disputed transactions. It centralizes all essential documents within a unified database and generates the required reports. 

Automating the processing of disputed transactions contributes to an enhanced cardholder experience, saves valuable time for bank experts, mitigates the risk of errors related to manual transactions, and simplifies the process of reporting fraudulent activities to regulatory authorities. 

For a tailored guidance on implementing the "Disputed Transactions" subsystem for card business, please don't hesitate to reach out to us at the following e-mail address:  [email protected].