Minimizing Chargebacks

By Tyson Wanlass, Manager of Fraud Protection – Doba

Chargebacks are essentially self-serve refunds. Instead of returning a product and waiting for a credit or refund, the customer simply calls his or her credit card company and disputes the charge.

The reasoning for the customer's dispute can range from a charge that the valid card holder did not authorize to receiving product(s) the customer feels were not as described. Sometimes the customer returns the product, and sometimes not. In the case of chargebacks that originate from an unauthorized charge, the customer never has any intention of returning the product.

In any instance, it's important that you the merchant understand how chargebacks originate and the steps you can take to avoid unnecessary chargebacks. Misunderstanding chargebacks can result in financial loss and aggravation to your business and can also compromise your merchant status with credit card companies. Rack up enough chargebacks, and you could be assessed a hefty fine by your credit card company, required to place a "good faith deposit," or even lose the ability to process credit card payments altogether.

This article offers some tips on how to avoid chargebacks and dispute the unavoidable ones.

Keeping your customer well-informed

The most effective approach to minimizing legitimate chargebacks is...