Minimizing Chargebacks in 2014 - Being a Successful Merchant

As a merchant, you know how frustrating chargebacks can be for your business. They take time to dispute and cost your business real money. To start 2014’s series on being a successful merchant, we’re going to look at four simple steps to minimize charge backs.

Create a clear and concise returns and exchanges sections

The single best way to decrease chargebacks is to simply try and prevent them from happening. This might sound cliché, but laying out a clear and concise return and exchange policy helps prevent many of the most common miscommunication issues.
Being able to inform a customer of your 30 day return policy before they order prevents them from trying to return a widget on day 31 and being upset you will not take back the product.

Work With the Card Holder to Minimize Loss

Many times a customer will file a chargeback claim due to the product or service not being as described to them. These errors can come from the customer misunderstanding to merely a defective product. Customers will often take a replacement or discount to make them happy and end the transaction dispute. Credit Card companies also appreciate merchant’s attempts to resolve disputes between the two parties.

Ensure You Keep Records of Transactions

This one is simple, but as a merchant, you are required to keep records of purchase and signatures for card present transactions. This will help you prove there was an authorized use (AU) of the credit card. Without this, the customer can dispute to his credit card company that he never authorized the transaction.

Be Aware of Fraudulent Purchases

Card Not Present (CNP) transactions are particularly vulnerable to fraudulent purchases. Be aware of any customers who behave or act in suspicious manners such as purchasing several big ticket items in one transaction. People with stolen credit cards often try to spend as much as they can in a short amount of time before the card is cut off. Merchants concerned about possible fraudulent purchases should call in a Code 10 Authorization Request .