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Note 86: Processing Disputed Charges

The Dispute Lifecycle

Whilst most bills are accurate and accepted by customers, some customers will want to query or contest the charges appearing on their bills. Aspects of charges that customers might dispute include:

  • Price: Customers may believe the biller's price has been calculated incorrectly. The charge may be higher or lower than the customer's expectation, but since customers are unlikely to complain about underpriced charges, disputes will be concerned with excessive prices charged by the biller.
  • Performance: Customers may believe that the product or service delivered by the biller was of poor quality (e.g. a 'noisy' international phone call). The customer's dispute will concern whether the full price should be paid. Customers will complain about these transactions soon after they are made necessitating prompt processing from the biller's network to the biller's billing system.
  • Existence: Customer may believe that charges on their bill should not be there. For example, a residential customer whose phone service has international call barring may dispute any international phone calls that appear on their bill. A wholesale customer reselling the biller's network may dispute charges on network services over which they have no 'ownership'.
  • Description: Customers may not recall a charge (e.g. phone call) and wish to query whether the details are correct. This may be due to a misalignment between the customer's expected description of a charge and how the biller actually describes a charge on the bill. Descriptors such as countries, area codes, suburbs, product titles and timezones can be a source of such confusion.

 

 

The dispute lifecycle follows a consistent, sequential process of selecting charges from a bill to raise the dispute, investigating the selected charges to evaluate the dispute's merit, and then resolving the dispute's details based on the investigation's findings.

The 'dispute' acts as a grouping mechanism for the charges identified within one complaint. Multiple disputes may be raised by a customer, and a single bill may have multiple disputes raised against it over time. Larger bills are more likely to generate multiple disputes since within a single customer different people will investigate the many charges, and will find their individual complaints at different times.

Reseller customers will find some errors immediately based on their own validation, but will also need to wait on their own 'retail' customers to identify further charges for dispute based on each retail customer's perception of what is correct. Some disputes raised against the reseller will relate to the reseller's processing (e.g. retail price), whilst others will be based on reasons similar to the reseller themselves (e.g. international calls performed despite call-barring set in the network).

The selection of which charges are in dispute is an important first step because until this has been agreed the total scope of the dispute cannot be established. Once a boundary has been established, the biller can decide whether the financial value of the dispute merits a deep investigation, and who should perform the investigation. Consolidated bills containing the charges from multiple networks may have specialised dispute work groups.

Ideally, dispute resolutions are performed at the individual charge level allowing the biller to employ the broadest scope to apply different findings against each charge. Disputes can be resolved in one of four ways:

  • Charge to stand: The biller has decided the dispute had no merit on a charge and the customer must pay the charge as billed.
  • Charge withdrawn: The biller agrees the charge is incorrect and 'withdraws' it from the customer's bill. The charge still remains on the customer's bill since as a financial document it should not be modified, but the amount can be negated through the use of a credit adjustment.
  • Charge partially withdrawn: The biller agrees that there is some merit in the customer's dispute and agrees that some portion of the charge will not have to be paid. The amount withdrawn may be described using either a fixed amount or as a percentage of the original charge.
  • A grant of 'free' network use: The customer is granted additional use of the network and/ or its products and services without charge. The network will drive what can be offered but can include free minutes of phone calls, higher data download limits for an ISP, journeys on a tollway, or months of access on a cable TV network. These 'free' products must be identified to the billing system to avoid them being charge at market rates, generating a further dispute.

The first three resolutions apply to charges only after they have been levied. The last resolution applies to the customer's future activity on the biller's network, and can be combined with the first three to satisfy a customer's complaint.

A Dispute's Size Matters

A dispute's complexity relates directly to the size and complexity of the bill against which it is raised. Complexity is different to the financial value of the bill. The number of transactions per service, and the number of services per bill define the total number of charges available for dispute, and influence how difficult dispute processing will be.

A bill's complexity will vary based on the biller's industry. Bills with predominantly recurring charges (e.g. cable TV, ISPs) offer the simplest dispute environment, utilities with limited network use are more complicated (e.g. water and electricity utilities), whilst high-volume transaction businesses offer the most complex dispute environments (e.g. telephone companies).

Complex bills are harder to process at all stages of the dispute process:

  • Raising: The specific charges disputes must be identified from those that are not disputed. This can be performed manually on small bills, but larger bills require automated selection mechanisms to make the process practical. Criteria used individually or in combination can identify charges flagged for dispute, and the applying multiple selections can build a large, complex dispute.
  • Investigation: Staff investigating a dispute's merit will vary their approach depending on its size. If a dispute involves ten charges then a manual approach may be appropriate, but if there are 100,000 separate charges disputed on a complex bill then an alternate solution must be found.
  • Resolution: Once investigated, a resolution must be applied against each disputed charge. This processing will be easiest if all charges in a dispute receive the same resolution. Smaller disputes may use this approach, but larger disputes are more likely to have separate resolutions for different sub-sets of the dispute's charges. In this case, each sub-set of the dispute's charges must be correctly identified (described, selected) and then resolved.

Smaller (e.g. residential) bills are unlikely to have the complexity problems that 'size' creates. Large corporate, interconnect or wholesale (reseller) customers are almost certain to do so though. For example, a bill reflecting the calls from an outbound call centre can include thousands of calls per day to a wide range of destinations. A dispute might apply to calls made on a specific date (e.g. public holiday), a date range, to a call destination (e.g. country), using a technology (e.g. calls from a fixed line to mobile phones), a specific product (e.g. pay-per-view (PPV) on cable TV) and / or time of day (e.g. evening). The disputed calls could be described based on combinations of these criteria, and separate disputes might be raised against the one bill.

Smaller disputes may be raised manually in real-time by staff or customers. Larger disputes, especially those populated through the use of criteria-based selection, may required asynchronous or batch offline processing. Offline processing allows the biller's staff to continue to perform additional work, including additional dispute processing, without having to wait whilst the processing required to raise a 'large' dispute against a 'complex' bill is performed. The result of a criteria-based charge selection against a large bill can result in only a few disputed charges whilst still requiring substantial processing. Those few charges must still be 'found' amongst the many other charges on the bill.

Originally posted by

- 01 September 2014

 

 

Links to other Notes

Previous: Using Bundling and Differential Pricing


 

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Recent Posts on purebill.com

» Processing Disputed Charges - Whilst most bills are accurate and accepted by customers, some customers will want to query or contest the charges appearing on their bills.

» Using Bundling and Differentiated Pricing - Using bundling and applying different pricing by market segments, billers can realise the most for their products and services.

» Business Practices Implemented Through Pricing - The price billers charge for their products can influence customer's consumption behaviour by increasing or decreasing their likelihood to purchase.

» Billing Pricing Models: Explaining Customer Impacts - Biller’s decisions about how they charge for their products and services result in pricing models that influence both a biller’s processing complexity and customers' behaviour.

» Billing Addresses - A billing application uses addresses in a wide variety of roles to describe the source locations of incoming transactions (from the network), details about the customers (and their representatives) who are billed, and the destinations to which the outputs from billing will be sent.

» Using Taxation Details Within Billing - Where governments tax the business domain being billed, the billing system will be a key calculation point since taxes are likely to be calculated on the finalised amounts after all rating / pricing has been performed, and after any discounts have been applied.

» Fraud Detection: Using Called Numbers To Find New Targets - Fraud occurs on phone networks, and when detected, it is closed down and stopped on the phone numbers on which it was detected. But how can the same bad actors / fraudsters be detected if they start up on new fraudulently obtained phone numbers, or have other existing phone numbers on the same network?

» Using Billing Notes and the Contact History - Billing applications make ‘contact’ with the biller’s customers each time a bill or reminder notice is sent, and whenever customers ring or email the biller’s staff with billing-related inquiries and requests. A billing note is one mechanism for capturing the key details of these customer / biller interactions. When a customer contacts the biller subsequently, the biller’s staff can review the customer’s prior contacts by looking at the notes that were recorded.

» How Does Payment Allocation Work? - Payment allocation is the association of credit amounts, such as new payments and adjustments, against a customer's outstanding debts (e.g. unpaid bills / invoices). There are different approaches for allocating credits against the customer's outstanding debt(s).


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