Imagine getting a charge for an online purchase that went wrong. Worse yet, not being informed when money is withdrawn from your business account. These are some of the effects of chargeback that can well be avoided.
Since the introduction of chargeback some years back, numbers indicate that more merchants suffer loss from it; 60% in 2019 to 80% in 2020. What does chargeback mean to you as a business owner? Can you keep your business safe from it? If these are some of the questions on your mind, this blog post seeks to answer each one of them. Here’s what you should know:
What Chargeback Means to You
Chargebacks can mean a decline in your business and some frustration on your side, so as a business owner it is important to know all you can about preventing chargebacks. Clients don’t always play nice, so when it comes to protecting your image and establishment, leaving nothing to chance is the way to go.
How to Keep Your Enterprise Safe From Chargebacks
1Provide Clients With Quality Products
Substandard items are one of the leading reasons why customers file for a refund. Before selling products, please take your time to have a look at them and, if possible, test their effectiveness.
Also, outline what a customer should anticipate when buying something from you. Take a step further by having a refund policy page on your business website. A customer can complain about the cost of your goods there.
2Do Some Research on Customer Behaviour
Customer behaviour research helps you understand how clients interact with your business. It also enables you to understand their preferences and purchasing frequency. Through customer behaviour analysis, you can identify when there is a rise in remuneration at a particular time and take the right measures.
If you notice that fewer customers are walking into your store, reach out to them through phone or email to determine why.
3Do Not Accept Terminated Credit Cards
The expiration date of most credit cards is printed on the front part of the card. Before accepting a card, go through its details. Fortunately, it is nearly impossible for a client to make a purchase online with an expired card. It is rejected as soon as they input expiration date details.
4Verify Client Information
Contact the bank that issued your customer’s credit card to confirm their phone number, address, and personal details. Many financial institutions offer fraud services, such as AVS and CVV2. Using these services can lighten the hassle of spotting fraudsters on your part.
Another excellent measure you can take is putting stricter credit card verification steps for transactions in countries notorious for fraud.
5Get Authorization Before Making a Sale
What does chargeback mean? It must be clear at this point. An invoice signed with the credit card hold signature is a crucial way to receive authorization for the whole amount on sale. Ensure that every transaction is paid from the same credit card and in full.
In the event that you are shipping a bulky order to a customer, fax or call them first to ascertain that they placed an order for the shipment. If they do not receive your phone call upon the first attempt, try again.
A second failure to reach them is a surefire indicator that the order has been placed fraudulently. Unless the client reaches out to you, do not proceed to send the shipment.
6Print Your Phone Number on Your Customers’ Billing Statements
If you have a business number, you can use it instead. This number enables customers to reach you quickly if they want to find out what they are being charged for. For further effectiveness, the contact details should be functional at any time of the day.
7Maintain a DBA Name That Your Clients are Familiar With
A DBA (or ‘Doing Business As’) name is a registered term that an establishment operates under. It is not its legal name and does not offer any personal asset shielding as a corporation or LLC does.
Many clients file for a refund when they spot payments to organizations that they cannot recognize. Your clients may know your product brand but may not have a clue about the company behind it.
You should also see to it that your clients fully understand your credit card bills. Have an innovative strategy in place where there is a URL on the charge of the Customer’s Credit Card Statement. The URL can not only enable clients to contact your support and billing team, but it elaborates on what the bill is for as well.