Chargebacks can also be frustrating for merchants, you can find that some consumers abuse the protective nature of chargeback policies. For this reason, it's essential that every merchant running an online business has a secure service in place that can detect possible security threats before they occur and to make the resolution as simple as possible if they do occur.
What online merchants need to know about chargebacks, and how can a secure chargeback solution be beneficial:
If you are selling goods and accept card payments, you should know that cardholders can dispute a transaction up to six months after making a purchase with their credit or debit card. This dispute is called a chargeback. Most of the time chargebacks occur when a cardholder disagrees with or does not recognize a credit or debit card purchase. Knowing how to prevent chargebacks can help merchants save time and money.
Chargebacks can cost merchants a lot of time, money and even their merchant account.
The good news is, there are ways to prevent legitimate chargebacks from occurring (because they will likely occur at the loss of your business).
Pay Global offer an advanced chargeback solution service,with features that help to detect possible charge-backs & fraudulent credit cards. Flagging up any issues, so that you can deal with it before it becomes a real problem as quickly and effectively as possible. Not having the detection features alongside your payment system, mean you are more likely to receive chargebacks and if they are not dealt with correctly you could be held liable.
If you trade online, nationwide or globally already or have plans to so in the future, you'll want payment processing software that can detect these issues in order to process transactions accurately the first time around. This is one of the more complicate aspects of online sales and it is not easy to do without the help of a reliable partner with knowledge & experience.
Could I be responsible for chargebacks?
If transactions are processed in anyway that is confusing or unclear to the consumer, or the merchant did not honour his terms of sale, or if the merchant does not follow the guidelines of their governing countries regulations of local or international business to business trade and business to consumer activity. In these instances the merchant most likely will be held liable for all chargebacks incurred.
Follow these five steps to help make sure you are not liable for chargebacks:
1) Use a name that your customers will recognize
Your credit card descriptor is the name that shows up on your customers’ credit card bills or online statements. Make sure you customers know what your company name will be on their card statement.
2) Be available
Make sure you have at least one easy way for those customers to get ahold of you. That means putting up an email address or phone number on your website.
3) The more detail the better
Provide detailed descriptions of what you’re selling. Include pictures or screenshots whenever possible. Dimensions are helpful if you’re selling products. Give your customers as much detail as possible of products and services, so they know what they are buying.
5) Don’t make a promise you can’t keep
Promising miracle results leaves you with exposure. If your product doesn’t cut through steel or deliver those 14lb weight loss in a week, you’re going to run into trouble.
6) Don’t hold onto your customers’ money and provide refunds
The longer that money is in your possession before your customers get what they paid for, the more time your customers have to issue a chargeback. Also offer refunds, if someone’s not happy with your product or service, they are going to get their money back one way or another.
Last but not least, the best way that merchants can ensure they're providing customers with the best service possible (without putting their own business in financial jeopardy) is to have detailed records on hand for each purchase, exchange, and return. Credit card chargebacks can be pretty complicated, but accurate detailed records will help you and the credit card company determine if a charge was fraudulent or legitimate.