Protecting your business from chargebacks

Chargebacks are when a cardholder reaches out to their bank to have a transaction forcibly refunded from the merchant. Luckily you can take steps to ensure that your business has put policies and protection in place to reduce friendly fraud, merchant error, and criminal fraud. Join us as we discuss the steps you can take to protect your business!

In-Person Transactions

Here are a few steps you and your team can implement to protect against chargebacks when accepting payments face to face.?

• The EMV or chip cards became the new standard format in October 2015. Merchants are required to own hardware that can process in-person transactions using this encrypted technology. If the merchant does not upgrade, they are responsible for liability with any cards using the magstripe technology on the cards. Be sure your POS terminal or any other in-person payment hardware can process EMV and chip cards.
• Post return policies near the checkout, or have customers sign receipts or invoices with this policy printed on them.
• Collect a signature whenever possible.
• Setup your hardware to process PIN and chip or PIN debit transactions.
• Request a driver’s license or ID to compare to the name on the credit card.

Phone Order Transactions

There are many scenarios where custom orders require the ability to take payments over the phone. Some customers prefer to speak to a person rather than provide their credit card information online. In any scenario, you can prepare to accept transactions with a few additional pieces of information to ensure your business stays protected against chargebacks.

• When collecting card information, also ask for the billing address on the card. You can request this information to perform an address verification.?
• Require the 3 or 4 digits CVC or CVV code to be provided when you process the payment.
• Collect a copy of an invoice with the customer's signature. This can be a game-changer in disputes. This provides proof that the customer agreed to purchase itemized goods and services, plus you can include your return and shipping policy on these documents.

E-commerce Transactions

E-commerce transactions are transactions entered on a website to purchase a product or service from your shopping cart. In this circumstance, you are not interacting with the customer in person. These scenarios can be higher risk, and it's worth it to use additional tools to validate the buyer.

• You can require the billing address of the card for address verification purposes.
• Require the 3 or 4 digits CVC or CVV code to be provided when you process the payment.
• Require acknowledgment of return and shipping policies before customers checkout on your site.

Red Flags

Often merchants will get a funny feeling when a fraudulent purchase is attempted. An example of this is when larger purchases are made by a new customer requesting custom or rushed shipping. Some merchants can put in place some internal protection for these scenarios. For example, orders over a certain dollar amount need additional customer verification procedures or are not eligible for expedited shipping.

Verifying your customer’s card information

You can call the bank and provide the card number, address, and phone number to verify a cardholder’s information before authorizing it. Many gateways have this built-in, but if you would prefer to talk to the bank, this gives you the ability to determine whether or not the card information is accurate with the bank records.

The Team on Your Team

We are here to help! If you receive a chargeback and would like help putting together a case to dispute this, feel free to give us a call.