What are Charge Backs and Secure high-risk merchant accounts?
You may have heard the term chargebacks while researching for your high-risk merchant account. A chargeback is a reversal on a sale that is forced by the cardholder’s bank. Chargebacks protect customers from dishonest merchants, but they can also harm your trusted business.
The risk of a chargeback helps merchants stay focused on delivering quality products and services. It will deter a shop from selling poor products and will also ensure the merchant delivers on their promise.
Chargebacks also help reduce the risk of criminal fraud for the consumer. Data breaches and stolen identities are huge problems and often result in many chargebacks. Many industries have been deemed high risk by merchant providers due to an excessive number of chargebacks.
If your company is in a high-risk industry, you’ll need to be prepared for chargeback problems. You will need to have a high-risk merchant account if you plan on accepting online or credit card payments.
Moreover, high-risk merchant account services provide a reliable payment gateway for all types of high-risk industries. An excessive number of chargebacks could cause your rates and fees to increase or for your provider to cancel your contract.
Chargeback prevention and management services can help reduce the number of chargebacks your business has. Chargeback prevention can cover your losses related to unauthorized credit card transactions.
Also, it can cover the loss of profit from theft or fraud. Chargeback management will not cover you from all chargebacks. If a client fails to receive a shipped product you will still be responsible for the chargeback.
Chargeback prevention and management will not cover mistakes either. Even though charge-back management services do not cover all refunds, they can still be an essential service to add to your high-risk merchant account.
Chargeback Prevention and e-Commerce
E-Commerce has an extensive history of chargebacks. Fraudulent purchases are common on e-commerce websites. You’ll need a way to protect your business.
Valid fraud is a common problem and involves a purchase made with a credit card without the owner’s consent. Normally, this comes under chargeback prevention services.
If most of your chargebacks are from customers saying they never received their products, you would not be covered.
When to Ask for A Chargeback?
There are many situations that qualify for requesting a chargeback like:
- Fraud or Unauthorized Charges On Your Account: If you do not recognize a transaction and suspect it the fraud
- Packages That Were Never Delivered: You may receive notice that an actual was delivered but it was not.
- Damaged or Defective Items: If an item came opened or missing some specific parts
- Inaccurate Charges On Your Account: The cost of the item purchased was separate from what you were charged (this occurs most usually at local businesses, which enter prices manually). Just keep that in mind, several card issuers provide $0 liability on illegal charges so if you have a card provided by the 5-star processing, you will not be liable for the unauthorized charges.
How to Request A Chargeback?
If asking the merchant for a refund did not work, request a chargeback with an experienced credit card issuer like 5-Star Processing. Many credit card issuers let up dispute transactions by phone, mail, or online. You may be able to submit a dispute directly through our app.
When you submit a chargeback, you may need to include supporting documents like copies of the receipt, invoice, agreement, and any you had with the merchant. Anticipate that the dispute can last up to or two billing cycles, whichever is shorter. Once you submit a chargeback request, the accurate procedure varies depending on your card issuer, network, and situation, however, generally results in the back and forth between various parties.
Why Clients Debit and Credit Card Chargebacks?
Clients are likely to chargeback in the following cases:
Shipping, Quality, And Refund Issues:
Clients are likely to file chargebacks if they are not happy with the product or the service. Moreover, chargebacks are also filed as the client initiates a fund after returning the product, however, fails to receive the refund amount.
Credit Card Issues:
Illegal credit card transactions are the most common cause of a chargeback. Usually, these chargebacks are initiated when the usage of the credit card is without any accurate authorization.
Duplicate billing and improper billing can both cause chargebacks. Duplicate billing happens when the client is charged twice for a single transaction. Moreover, chargebacks can also be filed if an error in the transaction processing is declined by issuing bank, however, the customer account is still charged.
How To Prevent And Manage Chargebacks?
There are so many ways through which you can prevent as well as able to handle chargebacks. Given below are some ways that you should know:
- Offer Detailed Information To Your Customers: In case you are selling merchandise online. Then, make sure you offer exact images and descriptions for the products you have listed. Including your contact information, and your return and shipping policy will assist your clients to contact you in case of any compliance rather than raising the chargeback request.
- Email Your Clients For Your Confirmation: Whenever you are sending confirmation emails to your clients, make sure you include the invoice and shipping details of the order to ignore. In case the shipping address and the billing address are separate, please verify the card and the client’s details before initiating the sale.
Does my Company Need Chargeback Prevention Services?
- Chargeback prevention and management services can help reduce the risk involved in running an online business.
- While chargeback prevention won’t improve your chargeback ratio, it can help you recoup some money lost due to fraudulent transactions.
- Most merchant account providers offer chargeback prevention and chargeback management services and can include them in your package.
- Your merchant can stay on top of the problem and help reduce the costs involved with chargebacks.
- Call Payment Gateway Providers to handle chargebacks or to know more about a secure high-risk merchant account.
Call 5-Star Processing For Getting Best Chargeback Services
To choose us, you can visit our website 5 Star Processing, moreover, if you are not tech-friendly, you can also choose 5-star processing. We are a group of experts who have experience in providing merchant accounts.