Chargeback Myths | Pinpoint Payments | Payment Processing Solutions
By Benjamin Grossman | February 03rd, 2016 | Risk Prevention, Chargeback Prevention, chargebacks, blogs
Many merchants are afraid of chargebacks — and rightfully so. However, there are many myths associated with chargebacks, which is why merchants need to weed through the myths to find the facts. Use our information in this email newsletter to debunk the popular myths and help online merchants manage chargebacks. Knowing truth from fiction helps prevent high rates of credit card fraud in the future.
If you have been told that recovering a chargeback from most card processors is a lost cause, this is a myth. While many card brands have their own set of guidelines and policies pertaining to managing transaction disputes, e-commerce merchants do not need to let this discourage them from fighting a chargeback. Despite myths that most card processors always favor the consumer, merchants should always dispute the claim and provide as much proof as possible.
While eliminating chargeback fraud is not possible, reducing the risk of this type of credit card fraud is possible. Merchants need to use in-house tools to prevent their risk of becoming a victim of credit card fraud, or friendly fraud.
Having chargeback prevention in place, such as Complete Pay, Verifi CDRN, and Ethcoa could help e-commerce merchants:
While merchants want to do everything possible to fight chargebacks, winning has a bittersweet result. Ecommerce merchants are still charged a fee by the online processing company. If the merchant is unable to control their chargeback ratio, they could face higher fees, and possibly have their merchant gateway account closed after being labeled a high risk merchant. Therefore, winning the dispute is only half of the battle. The true fight is using the data collected to prevent future chargebacks. Preventing the chargeback from occurring is the only way to prevent your ratio from swaying in the wrong direction.
While having a signed receipt would be helpful, it is not possible with online sales. Therefore, merchants need to be sure that they have other compelling evidence when they fight a chargeback. Examples of sufficient evidence to use are:
Do not fall victim to the myths. Educate your employees on credit card fraud prevention, and let us help your online business implement good security measures!