Your business may already be a high-risk entity because you’ve been dealing with chargebacks. Chargebacks are inconvenient for how they cause you to lose money from both lost transactions and fees imposed by your merchant service provider.
The worst part about chargebacks is that they can occur for various reasons. It could be from fraud, a technical error, duplicate billing, or because someone did not receive a product or service as advertised. While you might want to ensure the customer is satisfied, you’ll lose money while doing so due to your chargeback.
But your high-risk business can prevent chargebacks if you use a few points for your work. Here are seven things to do to keep chargebacks from being a possible threat to your business.
- Let your customers know what they are buying.
Start by providing your customers with details on what they are buying from you. You will reduce your risk of chargebacks when you let people see what you’re offering for sale. You can provide full descriptions of everything you’re selling. Videos and pictures that show your items from multiple angles will also help.
You can also answer questions people have about whatever you’re selling. Answering these questions will help people feel confident in the purchases they are making while reducing your risk of chargebacks. They will also know more about these products and how they might be advantageous for their needs, making them more likely to complete these purchases.
- Include a sensible billing descriptor.
One reason why chargebacks occur is that people aren’t fully aware of who is on a bill. A customer may dispute a charge if that person doesn’t recognize the billing party.
You can reduce this threat by producing a more accurate billing descriptor. The descriptor can include things like your company name and a phone number where people can contact you if they have issues. People can communicate directly with you if they have any problems with their orders.
- Prepare a sensible return policy.
You must have a suitable refund and return policy to prevent chargebacks. You can post details on your return policy on your website, at your register, or anywhere else you do business. The customer can review the timeframe for making a return, any fees associated with the return, and possible exclusions to the policy. The customer will contact you instead of the credit card company if that person knows you can handle the return and refund process. The direct effort prevents a chargeback, plus it improves your standing with the customer. The client will feel confident in doing business with you.
The return policy should still be reasonable and easy to handle. The policy should be something you can fulfill without risking possible losses.
- Provide details on your shipping efforts.
One problem with today’s online shopping world is that people expect to get their purchases delivered to them right away. Your business could be subject to chargebacks if your customers are unhappy with the shipping process. They might figure their orders won’t reach their destinations, resulting in chargebacks.
List whatever shipping policies you have on your website to let customers know what they can expect when buying something from you. Let the customers see how long it will take to ship something and if expedited options are available at extra cost.
Be realistic when telling people how long it will take for them to receive their orders. Don’t get anyone’s hopes up by promising you can get their orders ready in less time than most others.
- Offer the best possible customer service.
Your customer service efforts are critical to preventing chargebacks. Customers will feel confident in doing business with you when they notice you’re listening to their every need. They will contact you first instead of the credit card company if you pay attention to their needs and respond to whatever they require for work.
Always respond to customer calls and requests as they arrive. Be ready to answer questions and respond to whatever requests someone might hold. You can support a customer’s needs if you look at how well you’re answering one’s questions and facilitating the unique demands that person may hold.
- Review your fraud protection tools.
Every business can use fraud protection tools to keep them safe. You can use a firewall that blocks suspicious IPs. You can also use identity verification systems and protocols to reduce fraud risk. A security system can also include filters that identify potentially risky transactions based on value, frequency, location, and other factors.
Your merchant service provider can help you with various fraud protection tools that can protect your business and prevent chargebacks. Look at what your provider offers and see how you can use these systems. Don’t assume your provider will cover everything, as you might need to add outside materials of your own to help you prevent fraud from being a concern with your business.
- Look at your prior chargebacks to see what caused them.
The last way to prevent chargebacks is to look back at some of the chargebacks you’ve dealt with in the past. A high-risk business will likely have plenty of prior chargebacks to review. But there might be a trend surrounding all these chargebacks.
You might notice trends like chargebacks coming from purchases of certain values or specific locations. Some chargebacks may also come from terminals or shopping carts not meeting PCI standards.
Look at what you’ve been doing when seeing how you’re getting chargebacks. You can figure out how to fix things the right way when you look at what is open.
All seven of these solutions are worth reviewing when you’re aiming to prevent chargebacks. But make sure when using these points that you know where you’re going with your work. Your plan for stopping chargebacks will help you build your reputation, but you will require a thorough approach that entails supporting your customers and providing enough info to keep people comfortable with your work.
