You Should Know About Chargebacks And Friendly Fraud

More than $5.5 billion in credit card fraud occur every year worldwide. Credit card fraud can occur for various reasons including stolen or fake cards, account takeovers, and information hacks.

Stolen cards are generally reported immediately by cardholders; however, the perpetrator can keep running up a great deal of amount in charges by making unapproved purchases before the card is canceled and void. Be that as it may, unlike a stolen card, traded off record data can be put away for a considerable length of time or months before it’s utilized, making it difficult to conduct a thorough fraud analysis.

This is the thing that the vast majority consider as credit card fraud. The kind of fraud where they envision a thief taking a card or record data and after that utilizing it to make purchases until the wrongdoing is found and the record is shut. In any case, there is another sort of credit card fraud that is much more hard to avoid.

The chargeback process gives an approach for buyers to have charges expelled from their credit card if there is an issue with the purchase, for example, the nature of products, incorrect charges, or delivery problems.

A customer starts a chargeback by reaching their card-issuing bank and recording an objection regarding an item on their statement. The bank then switches the outbound exchange of assets, issues a temporary credit to the customer and the merchant is debited and gets a chargeback.

At the point when a chargeback is recorded, banks will switch the charge to the merchant and they may likewise charge the dealer a fee. A “friendly” fraud chargeback comes about when a transaction is finished effectively but a client asserts something else.

For instance, a customer may approve a buy with his/her own card and get the stock, however then record for a chargeback, asserting that they didn’t get the stock.

Industry investigators trust that some “friendly” fraud chargebacks are intentional, and the regulatory authorities have started a thorough fraud analysis and have stated initiative to prevent chargebacks.

How to Prevent Chargebacks

• Keep Customer Records: While it may be hard to diminish friendly fraud chargebacks from happening, you can unquestionably avoid friendly fraud losses. Keeping point by point exchange records will put forth a defense more viable and in this manner recover more benefits. Record the client’s telephone number, IP address, electronic mark page, delivery tracking data and point by point notes of any client correspondences. This straightforward demonstration can spare your business a ton of headaches and profit losses. Better to be as careful as possible.
• Ask Professionals: Ask professionals for help regarding this friendly fraud. They have adequate knowledge of its workings and will be able to help you better than anyone else.
• Use Electric Means: Vendors ought to consider having clients sign an electronic mark via a chargeback prevention services while finishing the purchase on the web. To start with, this helps the customers comprehend what they are purchasing and the terms they’re consenting to. Second, it gives you fundamental documentation to question future chargebacks.

To conclude, friendly fraud has resulted in enormous losses for many businesses and they have started taking steps to avoid these losses. While it was easy to conduct friendly fraud some years back, it is not so easy in this day and age.

Protect Your Business From The Damaging Effects Of Chargebacks

Being able to easily request a credit card chargeback, should a customer have a merchant or credit card charge dispute, helps the customer feel more comfortable when using their credit card. While intended to safeguard a cardholder from dishonest merchants, the filing of a chargeback with a credit card issuer is often used as the first recourse to resolving a dispute. And, in recent years we have seen a significant increase in chargeback requests: some legitimate, others that could have been prevented.

There are many reasons why customers initiate Chargebacks. The most common reasons are:

• Processing errors
• Dissatisfaction with products or services
• Fraudulent transactions
• Credits not processed
• Transactions not authorized or recognized
• Goods or services not received

So, why should your business defend itself against Chargebacks? Mainly because of the potential damage Chargebacks can do to your business. A business with too many Chargebacks will quickly experience a significant decline in profits from lost sales, unrecoverable shipping costs and unreturned products, plus fees and fines that often exceed the original purchase price. (Fees and fines can range from $20 to $100+ per Chargeback.)

Additionally, Chargebacks are one of the biggest reasons why e-commerce businesses get into trouble with their payment processors. Your business risks having its payment processing privileges suspended or terminated if Chargeback ratios are too high. For this reason, it is very important to have a Chargeback management system in place to settle disputes before they become Chargebacks and to protect your business from unwarranted and fraudulent Chargebacks.

While some Chargebacks may be your fault, others are preventable and some have no merit.

Chargeback Expertz has a proven Chargeback Prevention Notification System with an outstanding customer service department that will protect your business from the damaging effects of chargebacks—most importantly your bottom line.

The Simplest Way To Prevent Chargebacks

You have an e-commerce business, right? So you’ve рrоbаblу seen marketing miѕtаkеѕ that dеѕtrоу a рrоduсt’ѕ appeal and ѕеnd returns and chargebacks flying. And, you’ve most likely been on the receiving end of bad customer service. It’s been proven that avoiding one online marketing cardinal sin can make you more money.

The Cardinal Sin of Online Marketing

Timе аnd аgаin we ѕее mаrkеtеrѕ committing whаt customers consider to be the biggest marketing саrdinаl sin of e-commerce businesses—ignoring thеir customers аnd treating them as nothing mоrе thаn a mеrе аnnоуаnсе.

Your сuѕtоmеrs рut thеir faith in you and hаnd оvеr thеir hаrd earned mоnеу fоr a product or service. In return, your customers nееd to be rewarded with great customer ѕеrviсе, unеxресtеd bоnuѕеѕ аnd, mоѕt imроrtаntlу, quality рrоduсtѕ or services. If уоu аrе оnе of thоѕе marketers who is only looking for a fаѕt mоnеу grab and trying to squееzе out еvеrу lаѕt dimе from your сuѕtоmеrs, уоur business may be short-lived with a high volume of returns and chargebacks.

Every marketer should recognize and understand the incredible bеnеfitѕ to treating customers likе gold. If you treat every customer well, you can expect 25% to 40% of your future business to соmе from repeat сuѕtоmеrs, fewer refund requests or chargebacks and, in mаnу саѕеѕ, more sales through referral marketing.

4 Rules for Happy Customers 

Decades of marketing research shows that the following rules mаkе for vеrу hарру аnd satisfied сuѕtоmеrs:

Get bасk tо your сuѕtоmеr within 24 hоurѕ of the first соntасt.

To your online customer, 24 hours can seem likе an eternity. Mаnу times they want rеаѕѕurаnсе that their purchase wasn’t a miѕtаkе. If you аllоw that dоubt tо linger, buуеr’ѕ remorse саn creep in аnd a refund request or chargeback could роѕѕiblу bе juѕt аrоund thе соrnеr.

Give уоur сuѕtоmеrѕ unexpected bоnuѕеѕ.

Alwауѕ оvеr dеlivеr аnd consider giving уоur customers bоnuѕеѕ nоt included on your website or in уоur ѕаlеѕ lеttеr, either directly аftеr thе ѕаlе or several dауѕ lаtеr аѕ a “thank уоu.” Be ѕurе to соllесt уоur customers’ email addresses ѕо уоu саn rаndоmlу ѕеnd them updates to keep your business fresh in thеir minds.

Bе рrоmрt with rеfundѕ.

The decision to return money to a customer may not always be easy, but failing to promptly do ѕо can lead tо costly сhаrgеbасkѕ аnd оthеr potential hеаdасhеѕ. Many times a сuѕtоmеr hаѕ a legitimate rеаѕоn for requesting a refund, аnd the way you handle refunds may be the deciding factor on whether that customer will mаkе future рurсhаѕеѕ from уоu.

Provide quality рrоduсtѕ аnd ѕеrviсеѕ.

No matter whаt уоu аrе оffеring tо your сuѕtоmеr, mаkе ѕurе that the quality is аlwауѕ high. Whеn dеvеlорing a product, аѕk yourѕеlf, “Would I bе happy if I bought this?” If you саn’t honestly аnѕwеr yes, then go back tо thе drawing board. For example:

Problem: Let’s say you have two informational рrоduсtѕ which соntаin vеrу ѕimilаr fасtѕ аnd concepts. One is put together in a hodgepodge manner and the other оffеrѕ a соmрlеtе, ѕtер-bу-ѕtер sequence, рlаn, or system. Sales for the first product are okay, and sales for the second product are outstanding.

Ѕоlutiоn: Re-write the hodgepodge informational product so that, if fоllоwеd verbatim, it will асtuаllу dеlivеr thе rеѕultѕ promised.

Leaving a buуеr fruѕtrаtеd аnd diѕilluѕiоnеd with a рrоduсt or service is itѕеlf a major fаilurе, which lеаdѕ tо rеturnѕ, chargebacks, and аngrу сuѕtоmеrѕ.

Following these 4 simple rules аnd watch уоur profits imрrоvе.

Everything You Need To Know About Friendly Fraud

Also referred to as chargeback fraud, friendly fraud has become a huge problem for online merchants. Billions of dollars are lost every year through credit and debit card fraud. Chargeback fraud is ranked top of the list among these types of fraud. As such, it is becoming more and more important for online merchants to come up with chargeback management strategies to ensure they do not end up suffering from its serious effects.

The name friendly fraud might not sound as threatening or dangerous; however, this is far from the truth. Read below to find out more about this fraud and how you can implement an effective chargeback solution.

What is Friendly Fraud?

As previously stated, friendly fraud occurs during online credit card and debit card transactions. These transactions are referred to as card-not-present transactions. Usually, customers make a purchase online and use their card to pay. However, after they have received the goods or services purchased, they call the card company and state that the purchase was fraudulent or a mistake, this prompts the card company to chargeback the payment initially made. This results in the online merchant losing the sales proceeds, and more through chargeback fees.

How Online Merchants are affected by Chargeback Fraud

As you have seen from the above definition of friendly fraud, chargeback fraud leads to loss of sales proceeds from already processes and delivered goods/products. Furthermore, as chargeback rates for a merchant increase, their fraud risk also rises. This prompts transaction processing companies serving them to raise chargeback fees as a means of covering the increasing risklevels. These two costs hit online merchants hard leading to losses and in extreme situations closure of the merchant account. It is worth noting that these rising costs also mean that the affected online merchants have to raise product prices to cover the same.

Some Chargeback Solutions

• Create a Paper Trail

One of the most effective chargeback prevention measures online merchants can implement is to create a paper trail on each transaction. Records of the transaction, shipping, and receipt of the order provide you with the necessary evidence to argue against friendly fraud, deliberate or not.

• Easy Returns

Another chargeback security measure online merchants can implement comes in the form of easy return and refund procedures. This ensures that honest customers who are not looking to commit chargeback fraud can get their money back, while the merchant gets the product back. Furthermore, no chargeback fees will be slapped on the merchant in such cases.

• Fraud Prevention Software

Online merchants can also use software to detect the IP, shipping and billing address of their customers to be used in arguing against unfair/fraudulent chargebacks. The chargeback solution can even be used to detect customers using proxies to hide their IP addresses in an attempt to commit fraud.

• Enable AVS System

AVS system is something that can help businesses to verify all the transaction on time when they taking place on the website. AVS system saves your business from fraudster by verifying that original cardholder is making the transaction. It will ask for the correct billing address associate with the card customer using. If someone using the stolen card to make that purchase they won’t succeed as they don’t have information about the registered address with the card. This is an extra layer of security that only allows original cardholders to make purchase on your website.

With the above information, you have an idea of the chargeback tools you need to protect your online business against the threat that is, friendly fraud.

Bring Your Chargeback Ratio Under Control- Some Tips

Chargeback is a sad part of reality for the small and local business owner that accepts credit card.  It comes with excessive chargeback fees and additional expenses for tracking and investigating the fraud.  Fortunately, there are some ways on how you can protect your business against the unfair chargebacks.  This situation happens once the debit/credit card holder disputed a charge on their issuer.  In case the issuer found the dispute valid, the account of the merchant will be debited for the charge that was cleared previously; this can ultimately affect your revenue.  Here are some chargeback solutions that can help you prevent high chargeback ratios.

Utilize a Name That Consumers Can Recognize

The description of your business is basically the name that will appear on your customer’s monthly statement.  The primary cause of the chargeback is that they do not recognize the name of their merchant.  In case that your identity bears a different name other than your legal name or website, you can choose the name of your official site.  You may also use the URL of your e-commerce site that the customers can easily recognize. The name appearing on customer’s statement should be clearly identifying you to the cardholder.

Be Accessible Every Time

There are indeed some customers that will instantly file a chargeback by the time that they do not recognize a certain charge on their online statement.  However, there are also other customers who will research before filing a dispute.  You need to guarantee that there are different ways for the customers to reach you.  You may include your e-mail address, social networking account, phone number and mailing address on your website contact page. Be available as much as possible for your customers. Providing 24/7 customer services is the best way to resolve the chargeback before it occurs.

Provide a Complete Detail

Most of the people who initiated an online purchase ended up being disappointed because it fell short on their expectation.  The next thing they will probably do is to issue a chargeback since this is the product they expect.  A great chargeback prevention practice is to provide a comprehensive detail about the product.  You should include a photo of the product in different perspective.  Providing photo in different dimension can also help you in selling your product.

A Free Trial Should Be Free

If you are running A Trial Continuity Business than you should allow your customers to use the free trial for the good time period for free. The time duration should be clearly mentioned on website, customer always aware of it and processed the order by accepting the Terms and Condition of the free trial. You can also contact your customer before engaging them in a recurring transaction to know how they have ended up with the free trial. A good feedback always makes a good customer for the company.

Offer refund

This is the best approach in preventing the excessive chargeback fees.  You need to be aware that the chargeback was created as a form of security for the consumers and not for the merchants.  In case they are not satisfied with the product, they will be determined to get their money back.  Avoid the fees that come with the chargebacks by offering the refund.

These are some practices that you can use on your chargeback prevention system.  Managing chargeback is crucial to protect the revenue of the small and local business.

Everything You Need To Know About Chargeback Reduction Plan

Chargeback Security Expert and Risk Analyst will assist merchants in creating a formidable chargeback reduction plan that will benefit the merchant’s business in accordance with card brand rules. Chargeback Security Team Members will identify the wrong business practices that led to the excessive chargebacks or fraud.

Chargebacks are analyzed based on frequency, amount, BIN, IP, Geo and reason codes. Processing Statements and trends go through strict analyzes outlying the problem and isolate the cause. Chargeback Reduction tools and processes are educated to the business and urged to be utilized by the merchant:

• AVS
• CVV2
• Negative Database
• Velocity Screening
• ISPY Technology
• Chargeback Security Alerts
• Third-party fraud Scrubbing service

Chargeback Analyst will analyze the effectiveness of the current chargeback reduction practices and work on implementing new parameters or new policies. New chargeback/fraud reduction initiatives and modifying existing tools and policies are suggested.

We will propose a more effective strategy that will benefit merchant’s business by reducing chargebacks and maintaining them within the appropriate threshold as required by the processing bank.

The Chargeback Security Alerts, Real-Time Management System and Chargeback Reduction Plan will enroll the merchant in the Chargeback Shield Platform, which will allow merchants to intercept chargebacks and refund them in time! Avoid a Chargeback altogether and lower the costs and risks associated with chargebacks. By creating this extensive chargeback reduction plan in document form, Chargeback Shield Platform will provide the merchant the acceptable documentation required to place the business in good standing with the processing bank within a projected time frame.

What Can You Do When You Receive A Chargeback?

When you are running a business, there are going to be some issues and returns to your customers. This should be factored into your revenue forecasting. For most businesses, it’s around .10 to .30 percent of your businesses sales that will cause chargebacks. There will be some genuine chargebacks, but there will also be fraudulent ones.

Response to the Chargeback

You can fight chargebacks, but you first need to respond to the chargeback. There are businesses that choose not to respond due to many reasons. One of them is that they are covered by chargeback protection and fraud management, so they lose no money, or they know the chargeback is real.

If you choose not to respond, the money is returned to the customer. The problem with this is that you lose the profits, the item, and have to pay a fee. This is why most businesses choose to fight chargebacks.

If you choose to fight chargebacks, you have to provide compelling evidence of the transaction and the customer. There is a wide range of evidence that can be used, including fraud scores and receipts.

After you have all of your evidence, you will have to create a response letter. A chargeback expert can help you create this letter. After the letter is completed, the letter is sent to the customer’s bank, and the money is handled.

Wait!

After the letter is sent to the customer’s bank, you have to wait. They will ask you for all the evidence that you have, and your merchant account processor will also be asked for evidence of the transaction. This can take a few days since there are delays with some of the processers.

The Bank Decide Who Gets the Money

Chargebacks were originally meant to protect consumers, so their bank decides the outcome. This is why you have to provide as much evidence that you can because their bank is going to be biased towards their clients. If you provide the right evidence, you will win the chargeback claim. This means that the Chargeback Representment is accepted which you have provided to fight against chargeback. At this point, the money is returned to your account.

If you lose the chargeback, the issuing bank put the temporary funds as permanent to the customer. You will also be forced to pay a chargeback fee.

The time that a chargeback process takes can vary from less than a month to over six months. This depends on the card network and the issuing bank. The amount of time to process the chargeback also depends on the amount of time that you take to gather evidence. Most consumers avoid chargeback since waiting up to six months to get their money back is not appealing to them.

An Effective Approach to Managing Chargebacks

Chargebacks are frequent in business and are related to several causes. According to the reason for the chargebacks, they derive from merchant errors and criminal or friendly fraud. Either way, there are ways for you as a business to effectively manage chargebacks. Of course, chargeback prevention is an even more effective protective measure and should be dealt with most cautiously.

Even in the negative incident of getting chargebacks, there are solutions that can help you out. In fact, here are some things that you need to keep in mind.

Tips for Effective Management of Chargebacks

• First of all, you need to be ready to offer response chargebacks and not sit idle. There is a small window frame as to when you can dispute chargebacks, and you must be ready ahead of time.
• It goes without even saying that you should keep all the necessary documentation somewhere neat. In this way, when there is the need to present the documents for disputing the chargeback, you will have everything in place.
• You should also structure a solid defensive line to get the desired chargeback solution. It is essential that you fully understand the case, so as to make the most of your case.
• Be ready to follow up with more documents and additional pieces of information. The process can be time-consuming, and you need to be concentrated on the process.
• Understand the reason behind the chargeback and be ready with proper documents to take your stand against the chargeback dispute.
• Most of the time customer contact their issuing bank due to a lake of customer support. A good customer support helps you reduce numbers of chargeback.
• Show the issuing bank of customer what they have purchased and from where. You should have valid proof of purchase to show them.

About Professional Chargeback Management

If you are truly determined to reduce chargebacks, you must turn to the professionals and ask for their experienced eye for detail. They have got the know-how and the means to place a chargeback prevention system in motion and get you the best effects that you could have ever expected.

It is in their hands to assess risk management and go ahead with the most fruitful line of defense for your business. With their active contribution, you will be expected to get minimal chargebacks in no time. Even when you do, they will handle them properly, and the chances of payment will become slim to none. It takes a lot of hard work and dedication to accomplish that, which means that you need just the right chargeback expert for the job.

Bottom Line

It is essential that you manage your finances as a business in the most efficient manner possible. You should check out the most fruitful cooperation with a chargeback management company so that you can rest assured of the future outcome. If you are proactive and use the right tools, your chargebacks will diminish along the way, and your business will improve its revenues significantly.

How Can Prevent Card-Not-Present Chargebacks

In today’s digital world, the number of face-to-face debit and credit card transactions has decreased. Card-not-present transactions as becoming the norm, especially for online purchases. According to a study, the number of shoppers in brick-and-mortar stores was cut in half within a three year period. The main reason for this is that consumers online shopping instead of going to the store. And because of this, the number of card-not-present chargebacks has increased as well.

The boom in online shopping also brought problems to retailers. Because of the increase of card-not-present chargebacks, online retailers looked for ways to prevent them from happening. The first thing that retailers should know is the reasons why chargebacks are made. More often than not, the chargeback prevention systems in place are already outdated. As e-commerce continues to grow, it is important that retailers improve their fraud detection technologies to fight chargebacks.

Below are some ways to improve card-not-present chargeback security:

Limit Criminal Fraud

Unscrupulous people use stolen debit and credit cards details to make unauthorized transactions. More often than not, they choose online shops that allow card-not-present purchases. It is important to keep an eye out for suspicious transactions and to validate the transactions before completing the orders.

Another way to reduce chargebacks is to use the card providers’ fraud detection tools. Verified by Visa and MasterCard Secure Code are anti-fraud detection programs that ensure that the cardholder is the one making the purchase? The cardholder is required to provide a predetermined personal identification number during the checkout process.

Limit Merchant Mistakes

Chargebacks are also caused by mistakes made by the retailers themselves. Oversights and errors in business practices can also lead to revenue loss due to chargebacks. It is important that your return and cancellation policy is clear and easy to locate. Customers must also accept the policy before processing their transaction.

It is also important to make sure that the processing procedure is optimized. Make sure that you get authorization first before processing any transaction. It is also important that any transaction is processed once.

Limit Chargeback Frauds

Chargeback fraud is also known as friendly fraud. This is the case when customers use the chargeback system to get a refund. Instead of contacting the merchant for a refund, they use loopholes in the chargeback rules and void the transaction through the bank.

One chargeback solution to this problem is to improve customer service. Customers are more likely to go through the traditional refund process instead of a chargeback if the retailer is easy to deal with. Another solution is to have a no questions asked policy for returning items. If you are offering digital goods, then make sure that you have additional security measure.

These are some of the chargeback management solutions that will reduce card-not-present chargebacks. Retailers can consult chargeback experts to help maximize profitability, and protect one’s merchant account.

Chargeback Management System And The Benefits of It

The truth is that running a business requires quite a lot of considerations to be implemented and thoroughly accounted for. With this in mind, chargeback prevention is without a doubt something that needs to be taken into the most serious consideration. With this in mind, the first thing that needs to be clarified is what a chargeback actually is. This is the process in which the customers retrieve funds from the merchant as a result of a disputed credit card transaction. This process is almost always going to be initiated by the cardholder themselves as well as the corresponding bank of issue.

The Chargeback System and its Benefits

There are quite a lot of powerful benefits which stem from using a prominent chargeback management system. Let’s go ahead and take a look.

Prominent management– The chargeback system is going to simplify your workflow tremendously, and you are going to be spending a lot less time and money on annoying chargeback procedures. This will open up more time for you to look after your own business.

Dynamic real-time updates – the chargeback management system is going to provide you with the opportunity to integrate dynamic and real-time updates. The system includes built-in processors for payments as well as card provider updates. It is going to improve the overall performance and your success rate.

Precise analysis – you can take a look at the specific reason for the chargeback and undertake the necessary preventions to ensure that it never happens again. 

Secure Environment – protection should always be a number one priority for your enterprise. With a comprehensive chargeback system, you can rely on tools which are going to manage the chargeback and reduce it to its minimum.

 

Other Considerations to be Aware of

The chargeback system is also going to enable you to draw the proper conclusions and reach the necessary solutions. This is paramount for the proper conduct of your enterprise and the optimization of the processes within it. With this in mind, you are expected to drive a lot of advantages from it that every contemporary merchant should be focusing on. Not having a system of the kind means that you would have to physically visit and audit a wide range of different websites and the businesses they conduct to handle the issue. A chargeback system, on the other hand, is going to provide you with everything that you need in order to comprehensively handle everything that’s necessary. It’s quick, it’s convenient and most of all – it’s truly effective. Not only are you going to spare resources, but you will also increase customer satisfaction and reduce chargebacks.

The Chargeback System and its Process

The entire process revolving around chargeback is rather complicated, and it’s filled with particularly sensitive deadlines as well as legal procedures, documentation and a lot of additional requirements. It’s important to take a look at some of the most common reasons for which a chargeback process is going to be initiated on behalf of the customer. This is not only going to help the chargeback management draw the proper conclusions, but it’s also going to allow it to come up with proper and actionable chargeback prevention strategies. With this in mind, the most common issues are:

• The customer isn’t satisfied with the service or the product which have been delivered
• The items which were paid for weren’t delivered to the cardholder
• The transaction itself was not authorized
• The consumer attempts to engage in a friendly fraud
• An error in the billing process took place (for instance, the card was billed two times)

As you can see, the reasons are numerous but it goes without saying that unsatisfied customers are the most common initiators of chargeback processes. From this point forward, if the issuer is convinced that the cardholder has the necessary merit to initiate the dispute, he’s going to notify the actual acquirer of the transaction reversal who is going to notify the merchant. What is more, there is going to be a fee charged for the administrative trouble and efforts.

Things to Consider

The chargeback system is a necessity as it provides the customers with a lot of safety and security. Failing to implement a proper chargeback management system, however, is going to lead to increased losses and decreased revenues for the merchant himself. This is something that has to be taken into thorough account. There are plenty of different policies that could be implemented to the emphasis on chargeback prevention as well as reduction.

Some Useful Tips To Reduce, Manage & Win Chargebacks

At any time, the customer can file a chargeback for any reason code. Chargeback not only effects profits but also, the image of the business. Lesser the chargeback ratio better will be the reputation of the business. We, at Chargebackexpertz, provide tools and technology that prevents chargebacks and in case, you get one, we will help you fight that chargeback.

Chargeback process

When a customer files a chargeback, this is done by opening a dispute and asking the issuer to reverse the charge. The Credit Card Company will contact merchant’s bank who will notify merchant regarding the same. A detailed analysis and strategies are required to win a chargeback dispute. Chargebackexpertz provides the merchant with the management tools to achieve substantial results.

Causes of Chargebacks

Chargebacks can occur due to various reasons, but the most common ones are as follows:

• Item not received
• Item received is not as described
• Unauthorized transactions

How to Reduce or Prevent Chargebacks

• Mention clear and easy to understand return policy
• Provide contact information (phone number and email address) and a 24*7 customer service
• Respond to customer inquiries ASAP (as soon as possible)
• Provide customer with realistic delivery date, and tracking & shipment information
• Inform customers about out-of-stock items.
• Provide an exact picture and detailed description of the product.
• Provide adequate disclosures about the item to be sold.

Benefits

• Reduced Risk
• Increased Profits
• Ensured Sustainability
• Customer Retention and Loyalty
• Recovered Revenue
• Improved Brand Name
• Improved Industrial Relationships
• Declined Chargebacks.

Tools and Strategies for Effective Chargeback Management

• Identify the source so that appropriate prevention technique can be applied.
• Management platform that audits, review and reports alert.
• A customized action plan to reduce risk and chargeback issuance
• Challenge faulty customer behavior and friendly frauds

At Chargebackexpertz, we provide effective strategies to our clients to find the chargeback source, manage them and fight them in the most efficient way. The three major chargeback sources are:

• Merchant error
• Criminal fraud
• Chargeback fraud

Protecting Your Business From Chargebacks- A Basic Analysis

The most critical thing merchant has to be afraid of while selling products and services are chargebacks. If you get the chargebacks, it may lead to decrease in revenues and may also hamper the credibility of the business. To operate profitably in the ecommerce industry, you should have proper chargeback defense policies and fraud management policies. You should always ensure that chargeback to sales as well as fraud to sales ratio is always below 2%.

In the layman language, chargebacks are disputed transactions. Chargebacks were created by the law to protect customers from the unauthorized transactions. The consumers try to have a word with the merchant once or twice but if their issues are not solved they simply raise their concerns with their issuing bank.

However, some customers use the chargebacks thoughtlessly and that can cause losses to your business in online ecommerce industry. There are few tips which can reduce the chargebacks of your business.

1.Descriptor and/or DBA Name: DBA name i.e. Doing Business As. It is the name that appears on the bank statements of the customer. Mostly customers raise chargebacks when they do not recognize the name appearing on the payment slips or bank statements. You should make sure if DBA name is different from your business name and you should also make that thing understood to the customer. It is up to you to ensure the card charges are understood by the customers.

2. Contact Details: You should provide proper contact details to your customers, if customers have any queries and if those queries are not solved they will surely go to the banks and file dispute against your business. Customer service information of the business (Phone number & email address) should be mentioned on website clearly for the customers. You can also add your customer service phone number on your Descriptor and/or DBA name that will show on customer’s bank statement. Customers can contact you immediately if they’ve noticed unrecognized transaction on their statement.

3. Fraud Management: You should have proper fraud management team. The team should monitor all the transactions that take place on your website and as soon as you come to know about any fraud transaction, check the authenticity of the transaction. If it is complete fraud transaction then refund it immediately. The payment gateway providers and banks also monitor transactions and forward the same. It is up to you to make sure the transaction has not taken place through stolen card. If you’ve noticed any fraud transaction taking place on your website, the fraud management team either contacts the customer to verify the sale or refund the transaction to avoid any further issues.

4. Products and services up to the mark: Many times chargebacks are not raised because of fraud transactions but because the quality of the products and services are not up to the mark or substandard or below customers’ expectations. On your website clearly explain the product with images and proper details. You should also have refund policy. In case if the customers ask for the refund after the time mentioned in the policies you can clearly show your refund policies to them.

5. Accurate records and customer service: You should maintain proper call records, email conversations or any other conversations you had with customer somewhere. Maintain a proper track record of everything. Keep proper proof of delivery with you. You should also have a customer service team which should take feedback calls from the customers and in case of any issues they can be solved on priority basis.

Chargebacks can lead to high losses especially when your business is high risk business. To make sure you do not get caught in a trap of online fraudsters, take proper actions in the beginning. It is tough for the merchant to win the chargeback case itself however we as chargeback Expertz have proper chargeback defense, chargeback management and fraud management tools. We try our best that the chargeback is properly responded. Contact us today!

What Are The Drawbacks Of Chargebacks For An Online Merchant?

A merchant account iѕ a bank account thаt accepts debit оr credit card payments in аnу fоrm оf business. Thе account provider аllоwѕ client’s credit оr debit cards tо transfer amounts tо seller’s account in juѕt a short time. Uѕuаllу a “payment processor” manages аll thе transactions оf thе credit оr debit cards оf thе buyer аnd intо thе retailer’s bank account. Payments mау bе processed thrоugh accepting credit оr debit cards оvеr thе phone, in person оr bу fax. It саn аlѕо bе processed in a mоrе convenient wау ѕuсh аѕ hаving аn online payment gateway ѕuсh аѕ Pay Pal. Hаving a merchant account givеѕ tons оf benefits. It saves thе hassle оf transacting payments personally аnd withоut hаving tо ѕее thrоugh thеm оnе bу one. Thrоugh credit аnd debit cards, buyers саn аlѕо bе аblе tо buy expensive items frоm аnу shop оr company withоut creating аnу hassle tо bоth thе sellers аnd thе buyers. It saves thеm timе аnd frоm thе trouble оf paying instantly in cash оr checks. It iѕ еѕресiаllу in great uѕе fоr online business transactions whеrеin buyers juѕt add items tо thеir shopping cart аnd payments will juѕt bе made with juѕt ѕоmе clicks.

THE BASICS OF CHARGEBACK

A common problem for businesses that accept credit card transactions iѕ thе possibility оf thе cardholder attempting tо dispute thе claim. In thiѕ case, уоur company’s bank will notify уоu аnd bill a chargeback fee. Thеѕе bills саn bе costly оvеr timе аnd mаinlу affect internet, phone аnd mail merchants whоѕе ideal fоrm оf processing transactions iѕ thrоugh credit cards. Thе card processor nоrmаllу mails notification оf a chargeback processing fee. Thiѕ uѕuаllу occurs аbоut thе ѕаmе timе уоur account iѕ debited. Thе chargeback fee mау tаkе аnуwhеrе frоm twо tо thrее days tо bе posted tо уоur account.

It iѕ important in chargeback prevention tо аlwауѕ rеаd thе billing statement. Carefully observe thаt thе nаmе оf thе company уоu advertise fоr mirrors thаt whiсh it iѕ processed as, оr ensure thе nаmе iѕ сlеаrlу аnd properly shown оn thе receipt. Bе ѕurе tо include a receipt tо thе customer fоr аnу product or service sold. Anоthеr additional step iѕ tо monitor уоur logistics аnd transportation оf goods аnd services. Ensure thаt thе address уоu аrе sending уоur goods аnd services tо iѕ thе ѕаmе аѕ thе оnе verified аnd rеѕроnd quickly tо retrieval requests, аlthоugh thеrе аrе ѕоmе credit card companies ѕuсh аѕ Visa аnd MasterCard whо dо nоt require a retrieval request tо bе sent. Yоu mау аѕk yourself; iѕ thеrе аnу wау thе card processor саn protect уоu frоm receiving thе chargeback fees? Unfortunately, thе company iѕ аlwауѕ responsible fоr thе chargeback fee, but proper chargeback prevention саn lead tо minimizing thе number оf chargeback’s уоu receive.

FRAUD ANALYSIS

Turning a blind eye intо fraud аnd financial crimes iѕ nо longer acceptable fоr business. With thе latest technology аt hand, fraud schemes аrе growing mоrе sophisticated. Whеn it соmеѕ tо fraud in retail banking, to overcome thеѕе challenges, thе banking industry hаѕ gradually started adopting nеw wауѕ оf fighting financial fraud bу conducting fraud analytics. In order tо assertively protect thеmѕеlvеѕ аnd thеir customers, organizations аrе nоw taking thе road lеѕѕ traveled аnd formulating a comprehensive counter fraud approach with thе hеlр оf analytics.

CHARGEBACK PREVENTION SYSTEM

Thе term chargeback iѕ аll tоо familiar with U.S. merchants today. I’m ѕurе thе mеrе sight оf thе word mау make thеir blood pressure rise in response. Whilе аll merchants wоuld likе tо hаvе nо chargebacks, thе reality iѕ аt оnе timе оr аnоthеr thеу will bе faced with one. Simply put, chargebacks аrе thе reversal оf thе transactions dollar value. Chargebacks саn bе costly in thе amount оf energy spent disputing thеm tо thе fees incurred оn thеir merchant account. Understanding thаt chargebacks аrе juѕt a раrt оf “doing business” аnd arming уоurѕеlf with thе аррrорriаtе tools аnd knowledge саn hеlр уоu tо lower thеir occurrences. Bеing adequately prepared fоr copy requests аnd chargebacks саn greatly increase dispute judgments in уоur favor. Prevention аnd preparedness iѕ thе key.

Customer Related Chargeback

• Recognizable DBA (Doing Business As)
• Prоvidе Contact Information
• State Store Policies
• Communicating with Customers
• Recurring/Periodic Billing

Processing Error Chargebacks

• Authorization Issues
• Duplicate Billing
• Bad Swipes
• Transaction Batch

Preventing chargebacks starts with understanding thе common reasons chargebacks occur. Uѕing thеѕе facts, merchants аrе in a bеttеr position tо reduce thе amount of chargebacks thеу ѕее аnd prepare fоr thоѕе thаt occur. Chargebacks will аlwауѕ bе hаrd tо swallow, but muсh easier tо digest whеn adequately prepared for.

BENEFITS OF REGULARLY CHECKING YOUR MERCHANT ACCOUNT

Nоw thаt wе hаvе a basic knowledge оf whаt a merchant account is, fraud analysis, chargeback аnd chargeback prevention system. Wе саn ѕее thаt regular checking оf уоur merchant account will hеlр in monitoring fraud аnd chargeback stats, knоw thе mаin rеаѕоn оf gеtting higher number оf chargeback аnd hоw tо resolve thе issues. Gеtting a good knowledge оf thе chargeback prevention system will hеlр givе a bеttеr understanding оn hоw tо handle a merchant account with еаѕе regulate уоur chargeback аnd prevent fraud.

How To Minimize Chargebacks : Simple Tips

Merchants can control Chargebacks! Follow some simple steps and minimize the potential for customer disputes that can result in a chargebacks and revenue losses to your business:

Process a Settlement each day for each transaction.

Failure to deposit in a timely manner can result in chargebacks for “late representment”. Settle your credits or refunds daily; failure to do so in time can result in chargebacks for “credit not processed”. Promptly process refunds; never keep the customer hanging. If the merchant issues a refund by check, make sure to keep a front and back copy of the check along with the postage receipt. Gateway refunds should be processed within 3-5 business days. Never accept an expired credit card.

Use a clear retail descriptor which customers will easily recognize .

A retail descriptor is the business name customers will see on their credit card statement reflecting the purchase. Always include your phone number with the descriptor. If the customer does not recognize the name, they can call the number to verify the purchase.

Use the Address Verification Service (AVS) and the CVV security code.

Doing so requires the customer to confirm their zip code and/or their security code; this is an easy way to remove the possibility of stolen credit cards. Take note if a buyer requests to change the shipping address after placing an order. If you find a suspicious order, which still may be legitimate, try to contact the buyer and verify the order. If the buyer is unresponsive, or you are unable to verify the order, you can forward the order to app@chargebackexpertz.com and we can further investigate the order on your behalf. Please be sure to include any information that will assist us in our investigation.

Sign up with the Chargeback Prevention Alert System

Major banks like Fifth Third Bank,JP Morgan Chase, Wellsfargo, Bank of America, PNC, RBS Citizens and over 50 other banks participate in theprocess . The system allows the merchant to connect directly with distressed customers; then the Merchant can resolve the concern with the customer and/or Credit the transaction. The Moto is “AVOID CHARGEBACKS.”

Keep a record of shipping history

Immediately ship products. If you offer delayed delivery then indicate it on the sales receipt. Keep track of Proof of Delivery. Visibly post return or refund policies on your webiste. Be very cautious with foreign orders. In particular, orders from Asia, the Middle East and Africa have a higher rate of fraudulent transatons. Do not accept orders which have domestic billing addresses and foreign shipping addresses. Be observant of goods being shipped to the same location but appear to be placed by different buyers

Respond to chargebacks A S A P.

There is a limited time to respond to Chargebacks, if you miss the deadline, you have lost the ability to fight that chargeback. No response to a chargeback is the Merchant’s acceptance to the Chargeback. Fight Back! Win back your lost Revenue! Chargeback Management system with ChargebackExpertz is superior to any other system out there. Fight and Win up to 80% of your Chargebacks!

Keep copies of all Sales Receipts for at least 24 months

Sales Receipts should be filed by the order date. Clearly print return or refund policies for your business on the sales receipts. Your customer service number should be printed on every single sales receipt. Sales receipts must all be legible and should reflect your business name exactly as it appears on your signage. In case of a retrieval request or a chargeback, you will need to provide a legible copy of the sales draft.

Customer Service is the Key

Credit card fraud is very difficult to avoid when the cardholder and the card is not present during the transaction. Keep a list of bad customers to identify high risk orders. Often, disputes are because of “friendly fraud” or the customer simply regrets making the purchase. The best way to avoid this type of chargebacks is by responding with great customer support.. A partial refund is an option, but full refunds can be considered to avoid a chargeback (unless you are sure that the transaction is fraudulent). If the product or the service is going to be delayed, notify them by phone and through email. If it is a custom order, or there will be a delay in delivery, wait to process your customer’s credit card until the time the product is shipped. If a customer requests cancellation of a recurring transaction, always respond to the request in writing and cancel the transaction immediately. All communications with tcustomers should be recorded. This adds to the proof of services and avoid identity theft.

Be conscious of card checkers.

These are buyers who place low dollar transactions and then place large dollar transactions. Professional fraudsters tend to place a large volume of orders within a short period of time. Carefully review and verify such activity. Be wary of buyers who place orders using information such as different names, billing details, or email addresses. Take note of buyers purchasing unusual volumes of merchandise, and verify the possibility of duplicity. Take note of buyers requesting services to be rendered to an email address that differs from the order email address. Review the order’s details for any invalid or mismatched information. Below are examples of such discrepancies:

• Invalid or a wrong number
• Phone number does not match the state or country of the billing address
• IP location does not match the billing address
• Website log-in or registration details do not match the order’s details (such as name, IP, or email address)
• Need help with Chargebacks? Please complete our form for a Free Chargeback Analysis. We will manage your chargebacks!

How to Manage Visa Chargeback Reason Code 57?

Visa uses Chargeback Reason Code 57: Fraudulent Multiple Transactions to mark chargeback caused by multiple transactions by a particular merchant on a single Credit Card account within in short period of time.

The issuing bank received a claim from the cardholder, acknowledging that he or she participated in at least one transaction at the merchant side but disputing participation in the remaining transactions which was held in short period of time. The Customer also states the card was in his or her possession at the time of the disputed transactions.

What are the Causes of Reason Code 57?

Causes for Reason Code 57 are:

• Merchant fails to void multiple transactions of a single Credit Card account.
• Merchant tried to process multiple transactions fraudulently.
• Cardholder authorized the transaction earlier but later denied.

Prevention Techniques:

• The merchant should void the transactions in that Customer not participate.
• Merchant process Credit immediately if Multiple transactions held from a single credit card account of the same product.
• The merchant should share all Policies with Customers and let them know about the Orders and offers.
• Always request to Cardholder to sign the policies in addition to the final transaction receipt.
• Trained employees to operate point-of-sale terminals and void transaction...

How to Respond Chargeback?

Tips to Respond Chargeback are:

• If the proper Credit has been processed to the Cardholder’s account on all disputed transactions, send all the regarding evidence to an acquirer.
• If cardholder participates more than one transaction, provide proper evidence such as sale receipt, invoices of particular transaction and proof of delivery.
• If refund provided to Customer, provide refund evidence to the acquirer.
• If merchant void the transactions, inform the acquirer to avoid Chargeback.

How To Improve Card-Not-Present Chargebacks?

In today’s digital world, the number of face-to-face debit and credit card transactions has decreased. Card-not-present transactions have become the norm, especially for online purchases. According to a study, the number of shoppers in brick-and-mortar stores was cut in half within a three year period. The main reason for this is that consumers online shopping instead of going to the store. And because of this, the number of card-not-present chargebacks has increased as well.

The boom in online shopping also brought problems to retailers. Because of the increase of card-not-present chargebacks, online retailers looked for ways to prevent them from happening. The first thing that retailers should know is the reasons why chargebacks are made. More often than not, the chargeback prevention services in place are already outdated. As e-commerce continues to grow, it is important that retailers improve their fraud detection technologies to fight chargebacks.

Below are some ways to improve card-not-present chargeback security:

Limit Criminal Fraud

Unscrupulous people use stolen debit and credit cards details to make unauthorized transactions. More often than not, they choose online shops that allow card-not-present purchases. It is important to keep an eye out for suspicious transactions and to validate the transactions before completing the orders.

Another way to reduce chargebacks is to use the card providers’ fraud detection tools. Verified by Visa and MasterCard Secure Code are anti-fraud detection programs that ensure that the cardholder is the one making the purchase? The cardholder is required to provide a predetermined personal identification number during the checkout process.

Limit Merchant Mistakes

Chargebacks are also caused by mistakes made by the retailers themselves. Oversights and errors in business practices can also lead to revenue loss due to chargebacks. It is important that your return and cancellation policy is clear and easy to locate. Customers must also accept the policy before processing their transaction.

It is also important to make sure that the processing procedure is optimized. Make sure that you get authorization first before processing any transaction. It is also important that any transaction is processed once.

Limit Chargeback Frauds

Chargeback fraud is also known as friendly fraud. This is the case when customers use the chargeback system to get a refund. Instead of contacting the merchant for a refund, they use loopholes in the chargeback rules and void the transaction through the bank.

One chargeback solution to this problem is to improve customer service. Customers are more likely to go through the traditional refund process instead of a chargeback if the retailer is easy to deal with. Another solution is to have a no questions asked policy for returning items. If you are offering digital goods, then make sure that you have additional security measure.

These are some of the chargeback management solutions that will reduce card-not-present chargebacks. Retailers can consult chargeback experts to help maximize profitability, and protect one’s merchant account.

Chargeback With Reason Not as Described or Defective

The Customer must have to make a legitimate attempt to resolve the issues or return the Merchandise for Refund. If the attempts do not change any things in the favor of Cardholder, the Cardholder will move forward and dispute the Chargeback against the Merchant with Reason:  Not as Described or Defective Merchandise

In Reason: “Not as Described or Defective Merchandise Cardholder” claims that Good or Services which was provided by Merchant is not same as described at the time of purchase or the wrong merchandise was sent to the cardholder and the merchandise arrived damaged or defective.

Reason: Not as Described or Defective Merchandise link with an example:

Lisa purchase a Merchandise and after Shipping Lisa suffer from problem that Merchandise is damaged or defective (Some customer also suffer from various problem like quality is not appropriate or not same as described by Merchant, Merchandise or Services is counterfeit), so Lisa first attempt to return the Merchandise to the Merchant and get refund, if this attempt is not fruitful, the Lisa legitimately file a chargeback for reason: Not as Described or Defective Merchandise

Why Customer Dispute a Chargeback accompanied Reason: Not as Described or Defective Merchandise?

• Wrong Merchandise was provided to the Customer.
• Shipped Merchandise was damaged during shipping.
• Merchandise or Services is counterfeit.
• Merchandise or Services did not match what was described to the Customer.
• Quality of Merchandise not same as what we display to the Customer.
• Sale of particular Merchandise or Services was misrepresented by the merchant as interpreted by the cardholder.

Chargeback Prevention -Reason: Not as Described or Defective Merchandise

• Describe Merchandise or services accurately which was provided to the Customer.
• Provide evidence that Merchandise or Services are not counterfeit; Customer was agreed on the particular sale.
• Provide evidence that goods or Services matched what was described to the Customer or displaying on Sales Receipt.
• Always ensure that damaged or defective Merchandise should be replaced and reshipped on a Shipping Address
• Issued Refund to the Customer if Merchant received the sold Merchandise in case: Defective or Damaged.
• Always provide right information about the Merchandise and Services

Rights and Limitation of Reason: Not as Described or Defective Merchandise

• Chargeback cannot be filled until 15 days after the date Merchandise was returned or Services were canceled
• Before disputing the Chargeback the Customer must first attempt to return the Defective or Damaged Merchandise to the Merchant and waiting for Refund.
• Customer not disputed more than the Original Transaction Amount.