Chargebacks can have greatly damaging impact on your bottom-line. The costs tend to spike and there’s little you can do to push away the charge once it has been applied on your business. The best alternative is therefore to work out a chargeback prevention strategy rather than waiting to deal with it after it has already been applied. Here are some steps you can take to help you reduce chargeback.
- Communicate upfront
Some chargeback cases happen because the customer does not understand your product and only come to realize something is amiss after a transaction. It’s simple to avoid such an event. Let the customer fully understand all the costs that will be involved in the purchase of an item. Be sure to communicate with customers clearly so they fully understand your product alongside the costs and other processes that might be involved during the purchase.
Statistics indicate that well over 86 percent of customers often don’t contact merchants beforehand when they initiate a chargeback with the credit card company. Providing customers with all information upfront regarding what to expect of the credit card bill will therefore help a great deal.
- Respond to requests quickly
Customers tend to be impatient where their bills are involved. If you make it easier for customers to contact you in case something goes wrong then they will in most cases do so before they contact their credit card company.
It’s important to let the customer know beforehand how to get in touch with your customer service team in case an issue arises. Have your customer service team well informed and readily accessible through a variety of means such as phone, email and/or chat function on the business website. The easier it is for the customer to have the issue resolved the less the chances of the customer contacting the credit card company for the same.
- Avoid fraudulent transactions
Credit card fraud is a major cause of chargebacks on businesses today. They can take place in the form of card-not-present (CNP) transactions. It is possible however to safeguard your business from such fraud. In addition to the common methods like the use of a professional anti-fraud service and checking of customer details with the card-issuing bank, some payment processors such as EMB actually use extra verification and advanced security steps as a fraud and eventually chargeback prevention strategy.