When Shopify Protect rolled out, many merchants thought it might be the safety net they'd been waiting for. Automated fraud detection, liability protection, and zero chargeback risk on eligible orders, it sounds great on paper. But how much protection are you really getting? And more importantly, what's hiding in the fine print?
Let's break down how Shopify Protect works, what it covers, what it doesn't, and what you need to double-check before assuming you're safe.
How Shopify Protect Works Behind the Scenes
Shopify Protect is Shopify's built-in fraud protection feature, but it only applies to orders placed through Shopify Payments and Shop Pay. The idea is simple: if an order meets certain conditions, and it later turns out to be fraudulent (cardholder reports it as unauthorized), Shopify will cover the cost.
It's not insurance. It's not fraud scoring. Shopify uses its own internal fraud signals to pre-approve transactions in real time. If the order is approved and fits all the eligibility requirements, Shopify promises to cover the chargeback if one comes in.
Orders are reviewed automatically. You'll see a "Protected" label next to each eligible order in your dashboard. If you ship that order according to the rules (we'll get into those), you won't be held financially responsible if the payment is disputed.
So, What's Actually Covered?
Shopify Protect only covers chargeback fraud caused by unauthorized card use. These are the classic "I didn't make this purchase" types of disputes.
It does not cover:
- "Item not received" chargebacks
- "Product not as described" claims
- Any chargeback where the cardholder disputes the quality or legitimacy of the order
- Orders not paid through Shop Pay
- In-store POS orders
- Recurring subscription charges
Also important: the chargeback must come through the credit card network as "fraudulent." If the customer simply calls their bank and says they're unhappy, and the code isn't flagged as fraud, you're not covered, even if you did everything by the book.
Eligibility Requirements That Matter
To be protected, an order has to meet all of the following:
- Paid with Shop Pay through Shopify Payments
- Physical product (digital goods are not covered)
- Shipping label purchased via Shopify Shipping
- Order is marked as fulfilled within 7 days
- Tracking information is added to the order
- The order is shipped to the shipping address on file
That's a lot of ifs.
Even one misstep, like using a third-party shipping label or forgetting to mark the order as fulfilled, can void your coverage. And you might not even know it until a chargeback hits and you're left holding the bill.
What Merchants Should Double-Check
If you're relying on Shopify Protect, you need to make sure your order flow is tight. Here's what to verify:
- Are you fulfilling orders within 7 days? A delay could kill your coverage.
- Are you buying shipping labels through Shopify Shipping? If not, you're not protected.
- Is your staff marking orders as fulfilled consistently?
- Are you selling only physical products? If you sell digital goods, you're out of luck.
Many merchants unknowingly fall out of compliance by using apps, custom fulfillment workflows, or third-party shipping tools. Even automating fulfillment outside of Shopify's system can interfere with Protect eligibility.
What Happens When a Chargeback Comes In?
If a chargeback is filed on a "Protected" order and it meets all conditions, Shopify automatically covers the loss. You don't need to submit evidence. There's no manual response process. The payout is credited to your account once the chargeback is resolved.
If the order is not protected, because of ineligibility, or because it wasn't marked fulfilled properly, Shopify won't help. You'll have to respond to the chargeback like any other, and you'll be on the hook for the full amount if you lose.
Shopify Protect Is Not a Replacement for Risk Management
It's easy to assume Shopify Protect equals fraud peace of mind. But it's limited in scope. It only covers one type of chargeback. And it's easy to fall out of the eligibility bracket without realizing it.
If you run a store with higher-value items, fast-moving inventory, or any kind of customer dispute history, you need a more robust system. Shopify Protect won't shield you from refund fraud, policy abuse, or friendly fraud. And it certainly won't help with non-fraud chargebacks.
Shopify Protect can help in a narrow band of cases. But treating it as a complete chargeback prevention tool is risky.
Final Takeaway
So, what is Shopify Protect? It's a built-in fraud liability tool for specific Shopify Payments orders paid through Shop Pay. It works automatically, but only under strict conditions. If you meet those rules, Shopify will cover losses from unauthorized chargebacks. If you miss even one, you're on your own.
Merchants should think of Shopify Protect as a helpful layer—but not a full safety net. You still need to manage risk, fight chargebacks, and monitor your process to avoid false security.
FAQ: What is Shopify Protect?
What does Shopify Protect actually cover?
Shopify Protect only covers fraudulent chargebacks marked as unauthorized card use. It does not cover other types of disputes like item not received or product dissatisfaction.
Do I have to use Shopify Shipping for Shopify Protect to work?
Yes. Shipping labels must be purchased through Shopify Shipping. If you use a third-party service, the order will not be eligible for protection.
Can digital goods be protected?
No. Shopify Protect only covers physical goods. Digital products and services are not eligible under any circumstances.
What happens if I fulfill an order after 7 days?
The order becomes ineligible for Shopify Protect. Timely fulfillment within the 7-day window is required to maintain protection.
Will Shopify notify me if an order is not protected?
No. You need to manually check each order's protection status. Only orders labeled as "Protected" are covered under the program.
Is Shopify Protect available outside the US?
Currently, Shopify Protect is only available for US-based merchants using Shopify Payments and Shop Pay.
Can I appeal if Shopify says an order isn't eligible?
No. Shopify's decision on eligibility is final. If an order doesn't meet all conditions, it won't be covered, and there's no appeal process.
Chargeblast Spots What Shopify Doesn't
Shopify Protect is one piece of the puzzle. Chargeblast helps you fill in the gaps. From alert-based prevention to automated chargeback responses, we give you tools that cover the real risks: item-not-received claims, friendly fraud, and everything Shopify doesn't touch.
Don't just wait to find out you're not protected; get ahead of every dispute. Chargeblast is built for merchants who can't afford surprises.
