How to Resolve a Chargeback Dispute in The Merchants Favor

Oct 12, 2020

Originally, disputes were built to protect the buyer. These days, however, the idea of accumulating reverse charges poses a significant danger to businesses.

Chargebacks are inevitable and often exceed the merchant’s expectations. Excessive rates can take a toll on your credibility, credit background, and customer loyalty. Add that to the increasing favoritism for buyers, and the situation is bottom-line threatening for merchants.

But not knowing how to handle disputes is the perfect recipe for disaster because it may mean losing even in conflicts that you’d have otherwise won.

The truth is some reverse charges are unnecessary. In its place, a money-back can solve the problem. Studies show 5 percent of chargebacks happen when clients are unhappy with a service or item, and another 5 percent because the item didn’t match the product details listed on the site.

Only a few claims are fair. Most chargebacks are the result of transactions initiated via a stolen credit card. The wrong product or not-received orders may also trigger disputes. 

Excess chargebacks can lead to extreme consequences like merchant account termination; that’s why business owners must pay attention to them.

Understanding Reverse charges/Chargebacks

A reverse charge happens when a customer reaches out to their credit card company demanding their money back for an item not received or isn’t satisfying, or they never really bought.  

When a buyer files a chargeback with their credit card firm, the merchant receives a notice from the Acquiring Company. The merchant then gives the vital details so the acquirer can refute or confirm a fraudulent payment.

How to Prevent Chargebacks & Win

Merchants can reduce chargeback rates through the following techniques;

  • Issue quick refunds where valid. 
  • Offer unswerving customer support. Do not ignore customers.
  • Spot and fight chargebacks before they happen.
  • Keep records of all communications to increase the likelihood of winning in disputes.
  • Confirm all orders to avoid unfulfilled orders.

Partnering with a payment partner who understands your chargeback problems can increase the likelihood of winning.

The best payment providers feature in-built fraud-protection filters and tracking tools that monitor customer habits blocking any suspicious activity in real-time. 

Chargeback tools thwart any fraudulent activity before it happens, reducing the number of cases filed against your business and, ultimately, the chargeback levels.

Final Words

Take a proactive approach to chargebacks to protect your business from further losses accumulated from reverse charges.

Let us help you get a high risk merchant account today!

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Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

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