Top Ways to Reduce Chargebacks for Your Business

Summary: Chargebacks aren’t just bad for business, it can also jeopardize your merchant account.

Chargebacks occur with nearly every business. Every transaction businesses process, they will usually pay a penalty for these chargebacks. If you’re unfamiliar with the term, a chargeback refers to a dispute between the credit card company and the consumer. With too many of these, a business’s account could be revoked or be placed in a “high risk” category – which will indefinitely hurt your business. This guide is focused on how you can reduce chargebacks so you avoid falling into this pithole.

Your Policies Should be in “Fine Print”

Major retailers will print out their return statements on the back of their receipt due to the fact that customers will need to understand the policy information. Remember, not ever business has this options, so it’s crucial that you create a separate page on your website that tells the consumer every detail. Also, remind your employees to always inform the customer about the return policy.

Analyzing Refunds

Ask any business owner about refunds and their first thought will likely be that it’s detrimental to the overall sales. Unfortunately, refunds are unavoidable. But, refunds on the other hand, can be good for your business due to the fact that it avoids chargebacks. Remember, if you choose not to refund a customer, and the customer decides to dispute the charge, you’re facing a mark on your merchant account – along with losing a customer.

Always Verify One’s Identity.

Ask your customers to present a valid ID for any transaction involving a credit card. Be sure that you take a close look at the CVV or CVV2 code prior to completing the purchase. Depending on your business, decide whether or not you want to perform this periodically or with every customer.