Accept Credit Cards

Credit Card Chargebacks- Credit card chargebacks are part of the business when dealing with merchant accounts. In this credit card chargebacks review we are going to discuss what credit card chargebacks are and how you can limit credit card chargebacks.

Before Best Internet Merchant Accounts can even begin to discuss how you can limit the number of credit card chargebacks you have, we must first explain to you what are credit card chargebacks and the foundation for credit card chargebacks. Credit card chargebacks are simply when some type of funds are returned to your customer after they requested the return. This has nothing to do with cash purchases and is simply the return of funds that were collected when the customer used a bank account, credit card, debit card, or line of credit.

It is very important that you as a retailer know that chargebacks are the result of the Truth in Lending Act and the Electronic Funds Transfer Act by the Federal Reserve Regulation. The Truth in Lending Act deals mainly with credit cards while the Electronic Funds Transfer Act deals with debit cards. Chargebacks were put in place as a means for customer protection.

So why would a customer of yours request a chargeback? There are many reasons why a customer would request a credit card chargeback but only a few are valid ones. Those valid reasons consist of them having a dispute with you, a processing error, unauthorized transactions, and unfulfilled requests. After a customer requests a credit card chargeback from their institution, that institution will categorized it into four categories:

1. Technical- Bank error, expired authorization, or non sufficient funds.
2. Clerical- Wrong amount billed, duplicate billing, or never issued a refund.
3. Quality- Never got the product or wrong product.
4. Fraud- Identify theft. Perhaps the most common reason for credit card chargebacks.

It should be easy to see that you are never going to avoid credit card chargebacks, they are just part of the business when dealing with merchant accounts and accepting credit cards. There are some ways to prevent credit card chargebacks as a merchant. Some of those ways consist of you getting a signature from your customers, have a liberal return policy, and treat your customers as if they were Kings and Queens. Now you might be wondering how treating your customers like royalty could do you any good. Think about it though, if you treat your customers great and make them think they are the best customer, they are going to be more happy. This ties in with having a liberal return policy. We don’t mean having a return policy like CostCo, but have a return policy that your customers thinks favor them. You would be surprised that even though you offer a liberal return policy very few additional returns will be seen as a result. It’s more or less a security feature for your customers. As far as getting your customers signature goes, we understand that with eCommerce websites this is difficult. But when you can get a signature from your customer, it makes it a lot harder for the customer to file a credit card chargeback. That signature could prove everything for you when you are appealing the credit card chargeback.

If you don’t take chargebacks seriously, bad things will happen to you. Not only will your business suffer but you can be fined by merchant account provider for having a high number of chargebacks. This credit card chargeback wasn’t meant to scare you, but being educated on credit card chargebacks is the best thing for you. Remember, if you treat your customers like they are special, they will be happier with you and you won’t have to deal with credit card chargebacks!

Merchant W.H.

Charge.com

MerchantExpress