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Chargeback Protection is a Must for all Merchants

Chargebacks are one of the worst things that can happen to a business. The word alone can lead to shivers down a merchant’s spine, along with some choice words. While no one wants a chargeback, they happen to most merchants. If you have never suffered a chargeback, consider yourself lucky, however take notice because it is more than likely going to happen to you at some point in time. While chargebacks are typically unavoidable, thanks to a new generation of high tech fraudsters.

For years, merchants have worried about in-store fraudsters, such as those with stolen cards, or those who buy something and then return it after one use. For instance, there are fraudsters who purchase an expensive dress, wear it once, and return it claiming that they never worn it. They may think there is nothing wrong with this, but it can turn your business upside down if you are not prepared. Lately, internet fraudsters have taken control, by using stolen plastic payment cards. When the card’s holder learns of these charges, they call their card provider or bank and they file a chargeback.

A chargeback isn’t as simple as paying the funds back. You will end up paying a fine, and many times it can be 270% of the original charge. This means that a $10 purchase turns into a $27 charge, and a $1,000 charge turns into a $2,700 charge. This can harm any company, especially a new or unprepared business. All merchants need to make sure that they invest in merchant chargeback prevention. While this will not eliminate all chargeback fees, it can reduce them. merchant chargeback protection can also help you and your merchant figure out if the charge is indeed fraudulent, or simply just someone looking to scam to get their money back.

Fraud is on the rise for all merchants, and smart merchants are investing in chargeback protection. This is an absolute must for every merchant, regardless of your industry. By investing in chargeback protection, you are not only protecting yourself, but also your customers, because a low chargeback rate can help keep you from raising product cost.