How to Prevent and Win Chargebacks or Disputes

How to Prevent and Win Chargebacks or Disputes

Chargebacks is a risk for every business. Whether your business is large or small, retail or MOTO, chargebacks may be of a concern. There are multiple ways to prevent and fight chargebacks, and truthfully, if you are an honest merchant who performed the service / supplied the product, the odds are in your favor.

Clear and Recognizable DBA

When signing up for a merchant account one of the first things on any merchant application is the DBA (Doing Business As) name. This name shows up on your clients’ credit card statement and it is very important for this name to be recognizable by your client. If your client does not recognize the name on the statement, most likely they will pursue further research on the charge and may call to dispute it if no information is found.

Business Phone Number

Always make sure that the merchant account provider has the correct business phone number. The business phone number shows up on the online statement for your client and may be of real help to them if they do not recognize a charge or would like to verify a certain transaction. Most likely, if a client cannot get a hold of the merchant over the phone, they will call the credit card company to dispute the charge.

Customer’s Signature

No matter how large or small the sale amount is, a signature is a key to fighting chargebacks. If a customer signed for a transaction, odds are in your favor most of the time.

For MOTO and E-Commerce Merchants

Credit Card Authorization Form

A credit card authorization form is one of the best ways to prevent chargebacks. Once a form is completed and signed by the client, with the correct credit card details, and the correct business name and address, this makes the job much easier for the credit card networks to verify and approve a transaction. Nevertheless, it is a great tool for fighting chargebacks, as it is a solid proof the customer was fully aware of the charge. A generic template for a credit card authorization form can be downloaded here.

Customer’s Copy of ID

Verifying a person’s identity is crucial to preventing fraud, but taking a copy of it for MOTO transactions will substantially increase the chances of winning a dispute if one happens.

Signed Contract / Invoice

Always make sure your customer understands what they are paying for and under what conditions. When a customer signs for the products or services and for the terms of purchase, and you, as a merchant, follows your own terms, then there is no reason as to why the customer should receive their money back if you have done your job or provided the products as described on the invoice or contract.

Verified by Visa / MasterCard SecureCode

Although relatively new, VbV and MCSC are quickly raising interest among online merchants. By using the service, merchants can prove that the customer was the person doing the transaction and therefore the customer cannot claim that it was not authorized.