If you cannot resolve your dispute with the payment processor, you may wish to contact the relevant regulatory authority. This is usually a more cost-effective option than litigation as regulatory authorities often have power to order the payment processor to change his position and, at the same, may not charge any fees for processing the complaint.
In this article, we provide three tips which you can use in case you contact a regulatory authority, i.e., (i) make sure that you contact the right regulatory authority; (ii) check whether you have the right to submit your complaint; and (iii) request only remedies which the authority can provide.
Make sure that you contact the right regulatory authority
Payment processors may have different subsidiaries and each of them may be responsible for payment accounts in certain regions. For example, if a payment processor has a subsidiary in the EU and in the United States and the EU subsidiary is responsible for accounts of EU residents and the US subsidiary for the accounts of US residents, you may need to contact the subsidiary responsible for your account. Thus, if you are based in the United States, you may need to contact U.S. regulators and, if you are based in the EU, you may need to contact EU regulators.
Check whether you have the right to submit your complaint
Many regulators will not allow you to submit a complaint if you do not meet certain conditions, such as trying to resolve the dispute with an escalations manager or waiting for at least 30 days after sending your complaint to the payment processor. If you contact the regulator without meeting those conditions, you may need to wait for a few weeks just to get a response saying that you do not have the right to submit the complaint and you need to meet the applicable conditions in order to submit one.
Request only remedies which the authority can provide
Regulatory authorities are not courts. This means that they may have limited enforcement powers and many of them can just provide non-binding recommendations. Therefore, before contacting a regulatory authority you need to know whether they can provide you with the requested remedies. Otherwise, the regulatory authority may just tell you that it is not competent to address your complaint.
