Tips to Successfully Dispute a Chargeback & Protect Your Business

Published by Mitch Fardell at May 7, 2021

How to Manage Chargeback Disputes & Win

Keep organized records of all transactions.

If you are going to dispute a chargeback and win, you need all the documentation you have in order to prove that a transaction was legitimate. By having all transaction records organized, it’ll be easier to find the relevant documents necessary for your case against the chargeback filed against your business.

Appropriate documentation for chargeback disputes should include automated invoices and confirmation emails as well as tracking details and all communication with the customer.

Though it’s not required, you might want to consider requiring recipients to sign for packages from your business. By implementing this practice, you can verify whether or not a customer received their order from your business in case they file a chargeback claiming that the package was never received.

Regardless of the products or services you offer, it’s also important to encourage clients and customers to fill out surveys once they’ve received your products or services. Not only will you gain valuable feedback, but you will also have the opportunity to rectify any issues a customer has before it escalates to a chargeback.

Pay attention to the deadlines for chargeback disputes.

The amount of time a merchant has to dispute a chargeback depends on the credit card company, but the sooner you start the process and submit the necessary documents, the better chance you have of winning the case. In any case, make sure you dispute a chargeback by the deadline. Otherwise, the issuing bank will more likely consider the customer’s claim valid and that money would be taken from your high-risk merchant account to pay back the customer, not to mention the chargeback fees you would have to pay.

If your business has too many chargebacks, not only will you have to pay the chargeback fees for each individual case but your merchant account could be considered high risk, which requires higher fees to maintain, or suspended altogether. Additionally, a high chargeback rate can negatively impact your reputation and credibility as a merchant.

Assign a team member to prepare all necessary documents for chargeback disputes to expedite the process.

Always check the reason code.

Each credit card company has developed a set of reason codes to make it easier to handle chargebacks. As a merchant, it’s very important to check the reason code after a chargeback has been filed against you.

Although it will not tell you the exact details about the reason behind a chargeback, the reason code is the basis upon which the chargeback was filed so it’s very important to be familiar with the different reason codes provided by credit card companies.

Prioritize customer service.

While a business may have a great product or offer top-notch services, customer service is crucial in order to rise above competitors and thrive long-term. Perhaps the most important chargeback strategy for success is to provide exceptional customer service. Not only will this strategy help you win a chargeback dispute (especially if you have records of all attempts to resolve the issue beforehand), it can also prevent a chargeback altogether.

Unless it’s a case of non-malicious friendly fraud in which a customer simply didn’t know the difference between a chargeback and a refund, a customer who files a chargeback is already frustrated after not being able to reach your business to resolve the matter.

This is why it’s essential to provide contact information on your website and product packaging as well as your refund policies as clearly as possible. You should also have a team in place to manage customer feedback, questions, complaints, and so on to ensure customers feel like the company is listening to them and taking steps to take care of any issues.

To dispute a chargeback and win takes some time to master, but if you follow these steps, you’ll surely have a higher chance of minimizing revenue loss and, more importantly, maintaining a good reputation.

For more chargeback prevention and management tips from the experts at First Card Payments, contact us today.