What are Chargebacks?
In simple terms, a chargeback is a transaction that is disputed by a customer. Chargebacks are meant to protect customers from fraud and/or unauthorized charges. When a customer buys a product or service from a business and decides to dispute the charge with their card issuer, it can turn into a chargeback.
Reasons for Chargebacks
There are multiple reasons why chargebacks occur
- Items not shipped or defective goods.
- Unauthorized mail or telephone transactions.
- Invalid credit card or account number.
- Customer is not satisfied with product or service.
- Duplicate processing or human error.
How to Protect Your Business from Chargebacks
Fortunately, there are some ways you can help protect your business from these chargebacks, so you have a lower chance of losing money.
- Use a DBA (Doing Business As) name that your customers know.
- Make sure to give your customers their receipts for every transaction.
- For mail and telephone orders, generate a signed invoice or statement for proof of purchase or payment.
- Have your phone number printed on customers’ billing staements.
Reducing Risk of Chargebacks
Your business should take the chance of charge backs seriously, as that can help you save a lot of money over time. Consider training to help your employees spot fraud warning signs and handle credit cards the right way, keeping good records, and even fighting back when you can see that there is a clear reason to.
In some cases, a buyer of a product or service just does not want to pay for what they received. If they are trying to get away without paying for no real reason, fighting back can keep you from ending up with a chargeback from the credit card company. By doing that when necessary and being proactive about customer service and fraud issues, charge backs can be nearly a thing of the past for your company.
For more information or a free quote, visit us today at Dynamic Merchant Solutions.