The customer cancelled after the order already shipped. Who wins?

Timestamps decide it. If you can show fulfillment preceded the cancellation request and your policy disclosed a shipment cutoff, your position is strong; the customer's remedy becomes a return under your return policy rather than a cancellation. Without a disclosed cutoff, issuers lean toward the cardholder, which is why the policy presentation at checkout matters as much as the facts.

What is the difference between 13.6 and 13.7?

They are close cousins. 13.6 is fundamentally about a credit that was due or promised and never posted, while 13.7 is about a cancellation or return the merchant allegedly failed to honor. Issuers pick based on the cardholder's narrative, and the defense evidence overlaps heavily: policies as disclosed, cancellation and return records, and any processed credits.

Can a no-refund policy protect me from 13.7 disputes?

Only if it was properly disclosed and accepted before payment, and only within limits; a no-refund term does not override a cancellation made before any service was rendered or goods shipped. For digital services and reservations, clearly disclosed cancellation cutoffs are generally enforceable in representment. Bare no-refund language buried in terms rarely survives issuer review.

Visa · Consumer Disputes

Reason code 13.7: Cancelled Merchandise/Services

The cardholder cancelled an order, service, or reservation, or returned merchandise, and was still charged or never refunded. It overlaps with 13.6 but centers on the cancellation or return event itself: the customer says the transaction should have been undone and was not. Disclosure of cancellation and return policies at the time of sale is the pivotal issue in most cases.

Issuer filing window

120 days from the transaction processing date

Merchant response window

typically 20-30 days to respond, depending on the acquirer

Why 13.7 chargebacks happen

An order was cancelled before shipment but fulfillment and billing proceeded anyway.
Returned merchandise was received but the reversal never happened.
A service or reservation was cancelled within the allowed window and the charge stood.
The customer believed they cancelled, but the request missed your disclosed cutoff or channel requirements.
Cancellation policies were never properly presented at sale, making the merchant's refusal unenforceable in the dispute.

How to fight a 13.7 chargeback

Show the cancellation policy as disclosed at the point of sale, with evidence the cardholder accepted it, and demonstrate the cancellation fell outside its terms.
Provide records showing no cancellation request was received before fulfillment or the disclosed cutoff.
Document that the goods shipped before the cancellation arrived, with timestamps on both events.
For returns, show the merchandise never arrived back or arrived outside the return conditions the customer agreed to.
Present proof of a processed refund if the reversal actually occurred, which converts the case into a timing artifact.
Submit the service usage or attendance record when the customer consumed the service they claim to have cancelled.

How to prevent 13.7 chargebacks

Present cancellation and return terms clearly before payment and capture the customer's acceptance.
Build a cancellation flow that halts fulfillment and billing atomically, so a cancelled order cannot ship or charge.
Confirm every cancellation in writing with what was cancelled and what happens next.
Process return-triggered refunds on a fixed SLA from warehouse receipt, with alerts on breaches.
Honor borderline cancellations on low-value orders, since the dispute costs more than the sale.
Log all cancellation-channel contacts centrally so a request to any channel is visible to billing before the next charge.

High-risk merchant angle

Where 13.2 punishes subscription rebills, 13.7 punishes everything around them: the cancelled straight-sale order that shipped anyway, the returned nutra bottle that never triggered a reversal, the coaching program cancelled inside its guarantee window. High-ticket high-risk offers with money-back guarantees are especially exposed, because the guarantee itself creates a cancellation right that issuers will enforce through this code if your refund operations lag. Acquirers read a 13.7 pattern as an operations problem, distinct from fraud, and it invites conditions on your MID like faster funding holds. If you advertise a guarantee, staff the refund desk to honor it on the timeline you promised; the alternative is paying the same money out through disputes plus fees plus ratio damage.

Frequently asked questions

The customer cancelled after the order already shipped. Who wins?: Timestamps decide it. If you can show fulfillment preceded the cancellation request and your policy disclosed a shipment cutoff, your position is strong; the customer's remedy becomes a return under your return policy rather than a cancellation. Without a disclosed cutoff, issuers lean toward the cardholder, which is why the policy presentation at checkout matters as much as the facts.
What is the difference between 13.6 and 13.7?: They are close cousins. 13.6 is fundamentally about a credit that was due or promised and never posted, while 13.7 is about a cancellation or return the merchant allegedly failed to honor. Issuers pick based on the cardholder's narrative, and the defense evidence overlaps heavily: policies as disclosed, cancellation and return records, and any processed credits.
Can a no-refund policy protect me from 13.7 disputes?: Only if it was properly disclosed and accepted before payment, and only within limits; a no-refund term does not override a cancellation made before any service was rendered or goods shipped. For digital services and reservations, clearly disclosed cancellation cutoffs are generally enforceable in representment. Bare no-refund language buried in terms rarely survives issuer review.

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