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| Credit Card Chargebacks |
A chargeback reverses a credit card transaction arising from specific problems. The purpose of chargebacks is to protect consumers from the fraudulent activities of merchants or others. It differs from a canceled charge because it is not fully processed, while a chargeback is fully processed and settled. As a result, a chargeback may require several business days to be processed by multiple entities. There are several reasons for chargeback claims. The customer may wish to return or receive a damaged or defective item. They may have been charged for something they never received or could have been accused by the shopkeeper by mistake. Technical errors may have resulted in billing, or cardholder card information may have been stolen and used without authorization. However, regardless of the reason, chargebacks are not a desired situation since it causes loss of income and additional costs, and some disciplinary action may be taken by credit card services. MyPaymentSavvy provides different payment solutions and security that prevent your business from fraud, thus minimizing the risk of chargebacks. We have listed 6 ways for your business to reduce the risk of chargebacks.
Provide Contact Address
Credit card chargebacks can be avoided if buyers can quickly contact you. Therefore, please provide an email address or a telephone number, which your buyers can use to clarify questions and ambiguities swiftly. If you offer high-priced items at a low price, you may also want to contact your customers. As such, keeping information about your buyers will also help you. It is also suggested to respond immediately to the queries from your buyers. Any delay in the process might trigger doubts in your buyers, and they may feel that solving their problem is not a priority for you. Better communication with your customers can help you avoid chargebacks.
Keep Complete Records
Not all chargebacks come from scammers. There is a real possibility that the chargeback filed against you is valid and caused by your own actions. However, keep accurate records of customers' credit cards, their transaction date, the amount of product purchased, the term and conditions applied to the development and purchase, authorization information, etc. In that case, you can question or decline the chargebacks. If you and your customer have signed some documents, such as receipts or a contract, it can be helpful if you have been a victim of a fraudulent purchase. This contract can help you win a dispute against someone trying to take advantage of the chargebacks system.
Learn to spot the fraud.
All merchants like to receive big orders. But it is unlikely that a fantastic order and unexpectedly huge is legitimate. Fraudsters know they only have one chance to use their fraudulent card, so they stack a maximum of products in the order before the victim objects to his credit card. Most new customers usually purchase small trials before placing a large order. So be suspicious if the total amount of an order is above average - especially from buyers you have never had to do. A billing address that differs from a delivery address should also raise suspicions. So, it is necessary to pay attention to these details.
Train your staffs
As a business owner, you must train your employees to deal with transactions that sell with and without cards to avoid chargebacks on credit cards. Your employees should know what to do next once they spot a fraudster. They should know where to report it, like a mailbox or a hotline number. With the proper training, your employees can be an asset in preventing fraud.
Get in Writing
It is advised to do business in writing. The main motive is to get authorization from your customer, which comes in handy during the dispute. o protect yourself from irrelevant claims and chargebacks, we suggest you do business through contracts or agreements on paper. You must spell out all the services you provide for the kind of purchase your customer is making. Your customers can fax or email the signed contract or mark it electronically.
Follow the protocols
Every credit card or debit card has its own protocol that must be followed when accepting payment through it. If the purchase is made through the card at the counter, make sure you check the card's expiration date and enter the security code on the front or back of the card. Additional information about the buyer can help you fight back the chargeback claims. However, the protocol for card-not-present purchases, such as phone transactions, differs from approving online purchases; capturing the buyer's IP address, digital signature, etc., is better. Some protocols also allow you to verify your identity through an identity confirmation service, which asks customers to enter an extra password to authorize their credit or debit card payment online.
