Occasionally, a payment received from a debtor is subsequently reversed — for example, because the debtor initiated a chargeback through their bank, a direct debit was dishonoured after the funds had already been disbursed, or the payment was made by a fraudulent instrument. When this happens after the funds have already been remitted to you as the referring client, it creates a need for reconciliation.
How the clawback process works:
- When Merion is notified of a reversed payment, we will contact you promptly to advise of the reversal, the amount involved, and the reason (if known).
- The service agreement between Merion and the client sets out the obligations in this scenario — typically, the client is required to return the net amount remitted in respect of the reversed payment, as the debt is now outstanding again.
- Our commission on the original payment may need to be adjusted depending on when in the cycle the reversal occurred.
Your obligations: Once advised of a reversal, you should:
- Confirm receipt of the original remittance on your end.
- Arrange return of the net amount in accordance with the agreed process.
- Allow us to recommence recovery on the reinstated outstanding account.
Payment reversals are uncommon but do occur. If you have questions about a specific reversal or the process that applies under your service agreement, contact us directly.
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