What are Charge Backs?
- You may have heard the term charge backs while researching for your high-risk merchant account.
- A charge back is a reversal on a sale that is forced by the cardholder’s bank.
- Charge backs protect customers from dishonest merchants, but they can also harm your trusted business.
- The risk of a charge back 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.
- Charge backs also help reduce the risk of criminal fraud for the consumer.
- Data breaches and stolen identities are a huge problem and often result in many charge backs.
- Many industries have been deemed high risk by merchant providers due to an excessive number of charge backs.
- If your company is in a high-risk industry, you’ll need to be prepared for charge back problems.
- You will need to have a high-risk merchant account if you plan on accepting online or credit card payments.
- A high-risk merchant account provides a reliable payment gateway for all types of high-risk industries.
- An excessive number of charge backs could cause your rates and fees to increase or for your provider to cancel your contract.
- As a business owner, you should take steps to avoid charge backs as much as possible.
Charge back Prevention and Management Services
- Not all high-risk merchant providers are created equal.
- Many provide a wide range of services that will make your business safer.
- Charge back prevention and management services can help reduce the number of charge backs your business has.
- Charge back prevention can cover your losses related to unauthorized credit card transactions.
- Charge back prevention can be used to recover the loss of profit from theft or fraud.
- Charge back management will not cover you from all charge backs.
- If a client fails to receive a shipped product you will still be responsible for the charge back.
- Charge back prevention and management will not cover mistakes either.
- Even though charge back management services do not cover all refunds, it can still be an essential service to add to your high-risk merchant account.
Chargeback Prevention and eCommerce
- eCommerce has an extensive history of charge backs.
- Fraudulent purchases are common on eCommerce 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.
- This is normally covered under charge back prevention services.
- If most of your charge backs are from customers saying they never received their products, you would not be covered.
Does my Company Need Charge back Prevention Services?
- Charge back prevention and management services can help reduce the risk involved in running an online business.
- While charge back prevention won’t improve your charge back ratio, it can help you recoup some money lost due to the fraudulent transactions.
- Most high-risk 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.
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