The chargeback prevention tool is there to save the merchants from chargebacks. As a merchant, you always want to give satisfactory service to your consumers. But, sometimes, things do not go in your favor. On one side, we have been mentioning that digital payment modes are the future and on the other side, there are chargebacks. Yes, this is something that is designed to save consumers from fraudulent transactions. If they think the transaction is fraud or the merchant has not offered the desired content after making payment, they can raise chargebacks to get their money back.
However, the chargeback system is there to safeguard the online consumers and it also promotes online business. Now, talking about the merchants, it is something that can hamper the growth of the online business. This is why top merchant processors are coming up with a chargeback prevention tool. Chargeback prevention is actually a combination of various tools and strategies. It can save the merchants from chargebacks.
Understand The Ecosystem Of Chargebacks And Chargeback Prevention
Well, understanding the ecosystem of chargebacks is very important. Now, chargebacks happen when the customers ask their banks for refunds or when banks detect a problem in online transactions. Well, when customers do not get refunds directly from the businesses, they raise chargebacks. This is not a good thing for businesses. The merchants generally have to pay chargeback fees that come between $20 and $100. If your business gets too many chargebacks, it can actually suspend your merchant account. Or, the credit card processing fees might get increased.
Now, chargeback prevention is a special service offered by the merchant service provider to keep the business in good shape. With this tool, merchants will not have to fight chargebacks; they can easily prevent it. It is a combination of certain tools such as fraud deflection, address verification service, card security code verification, 3D-Secure 2.0, Blacklist, Order Validation, and many more.
Know The Chargeback Reasons
As we are talking about chargeback prevention, we must talk about the chargeback reasons. Yes, it will help the merchants to prevent the chargebacks easily. So, have a look at the points explained below:
- Item Not As Described: Well, customers can always raise chargebacks if the product does not match with the description mentioned on the website of the customers. If the product is damaged or if the color of the product is different, the customers can choose the chargeback option. So, you will have to make sure that you give the right item to your consumers. It will improve the brand value and you will have a lot of customers.
- Subscription Service Issues: Well, customers sometimes face problems with subscription-based services.