When a credit card user disputes a charge on his or her card, the bank or credit card company in question may issue a chargeback, taking funds from the merchant that issued the charge and returning them to the consumer. Credit card chargebacks happen for a variety of reasons. The consumer may have a legitimate grievance, such as having failed to receive an item that he or she ordered online. Chargebacks can also be fraudulent: in some cases, a cardholder will request a chargeback despite the fact that goods or services have been delivered as promised. Chargebacks, both fraudulent and legitimate, are harmful to your business. Although it is impossible to avoid them entirely, following these steps will help to prevent credit card chargebacks. You can also seek chargeback protection through Ethoca chargeback solutions.
Offer Superior Customer Service
When one of your customers disputes a charge, you should receive a notification from your processing software alerting you to the dispute. Take advantage of the opportunity to reach out to the customer promptly and courteously, with the goal of remedying the perceived issue with your product or service. If the customer requesting the chargeback has a legitimate grievance, make sure to work with him or her to make things right. If the chargeback turns out to be fraudulent, you will have an excellent chance of recouping your funds. As an added bonus, happy customers will help your business become more successful.
Choose Your Billing Descriptor Carefully
One of the most common reasons for friendly fraud is that a consumer does not recognize the name of the charge on his or her credit card statement. If your billing descriptor is an unclear abbreviation of the name of your business or if you use the name of a parent company as your billing descriptor instead of the name that your customers recognize, you may be especially vulnerable to chargebacks.
Have Your Customers Sign a Contract
It is important to have your customers sign a contract if you are planning to bill them on a regular basis. In your contract, be specific about the services that you will provide. By getting your customers’ written authorization, you will be well protected in the event that you have to deal with a chargeback.
Although credit card chargebacks are not entirely avoidable, following these steps will help to reduce their frequency and protect your business. Don’t hesitate to reach out to your credit card processor with any questions or concerns that you may have.
More Stuff For Your Inspiration:
- No Related Posts
This site uses Akismet to reduce spam. Learn how your comment data is processed.