Top Tips For Prevent Chargebacks

By: Gen Wright


A chargeback in online business may return of funds to consumer by an online merchant, which is often initiated with the customer's parent bank or Credit Card Company. It is quite evident that for merchants, chargebacks are undesirable and lead to losses and most merchants wants to avoid them by one way, or the other. In general, every merchant wants to play safe and have some sort of chargeback protection. Although, one cannot always escape such situations, merchants can certainly reduce chargebacks to a certain extent. If you are an online merchant who want to reduce his losses that come by fraudulent transactions, take a look on some of the simple tips below.

* Wait for authorization request: There are many cases when authorization requests are declined. As an online merchant, do not ever repeat an attempt after one transaction is declined. The customer's bank may have any kind of issues, either with the order, or some kind of technical default.

* Use AVS on the merchant account: Although many people believe that address verification service is no longer a updated way to check fraudulent transaction, it is still advisable to have the system for your business. Avoid those transactions that do not have a proper billing address. While you may not always avoid a chargeback with this, you can certainly avoid certain unauthorized transactions.

* Use CVV and other acronyms: This is highly necessary that your merchant account asks for CVV or other security codes for making a transaction. Avoid taking orders from credit cards that do not have security codes. In case you are accepting payments via internet banking, ensure that you only accept from renowned and trusted banks.

* Have a traceable shipping service: Every time you deliver a product, do not erase the details, especially the billing address and customer who received the product. Get every consignment signed before passing it to the customer. There are many cases when customers have declined receiving the order and have forced a chargeback.

* Keep a proper communication system: if you communicate with your customers in time, you may be able to reduce chargebacks to some extent. There are many cases when merchants have solved issues with customers through proper feedback, and this is not unreal. In case, a customer is not satisfied with their order or procession, you can offer them an additional discount, some cash-back, or simply a new item as replacement.

* Check the email address, IP and shipping address: In cases of credit card frauds, mostly online merchants are at loss. The simplest and wise thing to do is to check the email address of the customer. Mostly customers use an email address that resembles their name, birth date or work. Another thing you can track is the IP address. It becomes remarkably easy to locate a person or crook easily if you have his geographical location. Thirdly, the IP address and the shipping address should ideally belong to the same country, or else you may need to do an enquiry. For comprehensive solutions, take a look at BIN database which offers good solutions for online merchants.

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For more information on how you as a business entity can protect against such like losses check out merchant account chargeback or how to fight chargebacks.

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