Chargeback fraud has become rampant, especially in the age of shopping digitally. However, the ease of shopping today has also led to some shoppers committing fraud and frustrating buyers’ efforts. Chargeback fraud has led to the loss of revenue and time as business owners fight to regain the lost income. Discussed below are measures you can take to prevent chargeback fraud.
Document All Transactions
One of the best ways you can dispute a chargeback is by keeping a record of receipts and signatures. These physical documents will come in handy in the long run. At times, it can be hard to have such documents, especially with the rise of e-commerce based transactions. On such occasions, opt for chargeback services to help you implement a system to prevent such issues. However, it is best to also document conversations with the customer to assist with evidence if the situation arises.
Use Accurate Transaction Descriptions
Any customer who does not recognize the name appearing on their card statement automatically assumes the purchase was fraudulent and requests a chargeback. For instance, you had partnered with someone on the business, then you went separate ways and changed the company’s name. However, if the name you used or your payment processor is not the same as the new name for your business, then when a customer runs their card and sees a strange name, they will likely assume it is a mistaken transaction and request chargeback.
Educate Your Team on Payment Processing Compliance
Arrange for your team to be trained on payment processor compliance so that they can easily flag any suspicious activity going on. With that information, whether a card is physically present or online, they will be able to stop a fraudulent transaction as it happens. This is one of the best defenses a merchant can use against fraudulent transactions. You also need to keep the training up to date as people committing fraud are constantly changing tactics.
Be Responsive to Customers’ Issues
One way to combat friendly fraud is by providing customer support at all times. If a customer can reach you anytime to complain over services offered or a product delivered, you can resolve the issues immediately. However, when someone contacts you for clarification and cannot reach you, they are likely to initiate a dispute for fear of losing their money. While not all businesses have the luxury of being available 24/7, in such cases, they should ensure their websites are clear on issues like delivery delays, quality of products, and return policies. Also, make a point of solving customer issues as soon as possible.
Watch Out for Unusual Orders
One way to ensure merchant fraud protection is paying attention to unusual orders. Some things to be keen on are large orders, different shipping addresses, and multiple purchases made in close succession. Organized fraudulent groups commonly order items in large quantities, request a chargeback then sell the products. Do not assume anything you see out of the ordinary. You can give the cardholder a call and confirm the purchase before completing the order.
If you do not take the necessary step, chargeback fraud can hurt your business leading to significant losses. Therefore, take the essential steps like training staff, opening communication lines with customers, and investing in technology against fraud.