Chargebacks can cost retailers and e-commerce companies big bucks. According to a recent report, chargebacks, chargeback fraud, and expenses related to managing a total of $40 billion per year for merchants. That’s why many of these companies are prioritizing chargeback prevention as part of their overall strategy.
If your company is feeling the burden of chargebacks and want a better way to stem them, follow these chargeback solutions.
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Follow the Proper Payment Protocols:
If you want to avoid “friendly” fraud chargebacks, you must ensure you’re adhering to the right rules or steps for the card-not-present transaction. This means obtaining the right information, including customer signatures, PINs, or CVV codes. According to a recent survey, card-not-present fraud could reach $130 billion by 2023. And according to industry analysis, the cost of false declines to businesses ranges from $118 to $331 billion in the U.S. alone.
Implement Clear Payment Descriptors:
A common cause of chargebacks happens when a customer doesn’t recognize a transaction on their statement and therefore they report it as fraud. To avoid this form of “friendly” fraud, ensure that when your company description ends up on a statement it clearly states the store name, company name company service phone number, and the full name of the purchase. This will easily eliminate a common cause of chargebacks.
Prioritize Customer Service:
If you want to ensure your customer doesn’t report an unrecognized charge as fraud, make sure your customer service is easy to get in touch with — or else they may just call the credit card company first. If they are concerned about a suspicious purpose, make sure your customer service team is willing and able to (with a helpful, friendly attitude, of course) assist your customers with identifying a suspicious order.
Make Sure Your Refund Policies Easy to Find:
Always keep in mind that while refunds are not great for any company, chargebacks are worse. You want to be sure your refund and returns policy is front and center for all customers to reduce the chance of a chargeback request. The more transparent you can be, the better. At the same time, when a user reaches out to your customer service team for help with a refund or return, the process should be as straightforward as possible.
For any retailer, chargebacks are another cost of doing business. But, if you’re business is not taking the proper precautions, these charges can lead to major losses.