What Happens When an Escrow Transaction Goes Into Dispute?
Most escrow transactions end quietly: the buyer receives the item, confirms, and the seller is paid. But sometimes something goes wrong.
Most escrow transactions end quietly: the buyer receives the item, confirms, and the seller is paid. But sometimes something goes wrong. The item doesn't arrive, it isn't what was agreed, or the two sides simply disagree.
That's when a dispute comes in, and it's the part of escrow that matters most. Here is exactly what happens on XcrowPay.
Who can raise a dispute, and when
Either side can raise a dispute: the buyer or the seller. It must be raised before the funds are released. Once the buyer has confirmed and the money has gone to the seller, the transaction is complete.
To raise one, use the Raise a Dispute button on the transaction page, or on the payment link if you paid as a guest. Raising it from the transaction itself makes sure your case is linked to the right payment.
What happens to the money
As soon as a dispute is raised, the funds are locked. They can't be released to the seller or refunded to the buyer until the dispute is resolved. Neither side can move the money while the review is under way.
What evidence to send
The decision is based on evidence, so the more you provide, the better. Useful evidence includes:
- Chat screenshots showing what was agreed: the item, its condition, the price and delivery
- Photos or video of the item as received
- Proof of delivery: waybill or tracking numbers, rider confirmation, delivery photos
- For services: the brief, the delivered files, and any revision requests
Be specific about what went wrong. "The phone has a cracked screen; here is the unboxing video" is far more useful than "it's not good".
How long does a review take?
Urgent cases, such as suspected fraud, are prioritised and handled as quickly as possible. We aim to review most disputes within 24–48 hours. Complex cases, or cases where we're waiting for evidence from one side, can take longer, so respond quickly when the team asks for information.
How the decision is made
The XcrowPay team reviews the evidence from both sides and makes a final decision:
- In the seller's favour: the funds are released to the seller.
- In the buyer's favour: the transaction amount is refunded to the buyer.
The escrow service fee is non-refundable, because it covers holding the funds and processing the payment. Refunds are returned through our payment partner to the account the buyer paid from. The decision is final, as set out in our Terms of Use.
How to avoid disputes in the first place
Most disputes come from misunderstandings, not fraud. You can avoid most of them by:
- Agreeing everything in writing before payment: exact item, condition, price and delivery date
- Sending real photos of the actual item, not catalogue pictures
- Keeping proof of delivery
- Talking first. Many problems are fixed with one message before a dispute is needed.
What if the buyer just doesn't respond?
That's not a dispute. If the buyer never confirms or disputes, both parties are notified. If there's still no response and no dispute, our team reviews the transaction and releases the funds to the seller, normally within 2–3 days.
The full policy is on our refunds and disputes page. You can also read how escrow protects both buyers and sellers.