Chargebacks Prevention
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Understanding the term “Chargeback” is the first step in preventing them. A “Chargeback” is when a customer calls their credit card company and disputes charge on their statement. This dispute has the potential of turning into a “Chargeback”, which is a forced reversal of the charge from your account back to your customers account. Keep in mind that it comes with penalty fee per occurrance and if you get to many chargebacks within a given month, your account will be closed for “Excessive Charrgebacks” and under Visa / Mastercard Rules, placed on a Terminated Merchant File.
With that said, you can see that “Excessive Chargebacks” can destroy your reputation and the future of your business. So lets analyize the process and how to prevent them. First, when a customer makes the initial dispute, you will receive a “Retrieval Letter” requesting that you provide information on the transaction in question. You have only 7 Days to respond to the “Retrieval Request”. If you do not provided the requested documents within the time-frame, this transaction will become a “Chargeback”.
Now you need to analyize why this happened and take steps to keep this from happening again. Ask yourself, “What Can I Do Differently To Avoid This In The Future”. Below are somethings to consider:
1) Did the customer remember my Business Name and the fact they made the purchase ?
2) Did I ship the product in a Timely Manner from the time I processed the credit card ?
3) Do I have evidence of shipping, such as Signed Receipt from Fed-Ex, UPS, DHL, USPS ?
4) Do I have evidence of a Signed Credit Card Receipt or Manual Imprint of the card ?
5) Is my Customer Service Phone being answered to address potential customer problems ?
6) Do I need to change my “Return Policy” and be more understanding to customer issues ?
7) Am I on the Alert For Credit Card Fruad and using methoods set-forth by Visa / MasterCard ?
The above 7 questions will usually give you the answers to how Chargebacks can be avoided in the future. You must use common sense and make a honest assessment of the situation. Don’t fool yourself and think that this won’t happen again, because if their is a problem somewhere, it will happen again.
Remember that accepting credit cards is a “Privilege not a Right” and if you abuse that privilege, you may not be given a second chance. Stay out of trouble !!!!!!
If you have any questions about Preventing Chargebacks, feel free to give me a call.
MARK SANDS
http://www.usa-merchantaccount.com
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