Category Archives: Chargebacks

How to Minimize “Friendly Fraud” Chargebacks

June 1, 2015 Abtek Leave a comment

With the EMV Mandate, data breaches, and POS innovations, merchants have enough to worry about when it comes to how they handle the way their customers pay. Which is why one particular strain of chargebacks is especially a huge nuisance.

Know the Facts

Did you know that “friendly fraud” chargebacks are commonplace now? The name is a misnomer, though–”friendly fraud” happens when a customer purchastes goods online and then disputes those charges with his credit card provider, claiming the goods were never delivered. A recent study found that 86% of chargebacks are deliberate; and Visa estimates that in 2012, merchants lost $11.8 billion due to friendly fraud. Many merchants can head this off by having accessible customer service reps.

But what else can businesses do to curb losses due to these kinds of chargebacks?

Verify

Ask for security codes. These are the numbers that are located on the back of a credit card. Since merchants can’t store security codes, hackers can’t steal them.

Ask for Proof

Ask customers to electronically sign for their purchases. When you have the signature of a customer that proves the product was successfully delivered, it undermines any claim they may make that the product wasn’t delivered.

Chargebacks are messy. If you don’t deal with them in a short window of time, you could be forced to pay fees and penalties that could have been avoided entirely. It’s always a good idea to have a merchant services company on your side–especially one that hears you out and provides reliable customer service.

Here at Abtek, we fight friendly fraud chargebacks on your behalf, not only saving you the headache of dealing with them, but also potentially saving you a lot of money. Give us a call today at (800) 544-9145 to find out how we can help you prevent unfriendly chargebacks at your business.

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Chargebacks, Merchant Service Providers

Trying to Grow Your Small Business? Merchant Service Providers Can Help

May 7, 2015 Abtek Leave a comment

Today, the ability to process credit cards is essential for the success of any business, regardless of size. According to a Javelin study, approximately 66% of all in-store purchases are made with credit or debit cards–and that percentage is only expected to grow as more and more people move towards EMV and mobile payment solutions.

For so long, small businesses have been plagued with not being able to afford the charges associated with accepting credit cards, but today, there’s really no way around it. And while it may be tempting for small businesses to try to save a few bucks by not using a merchant service provider (MSP), it could end up costing you much more in chargebacks (and headaches!) in the long run.

Here’s a look at why your small business may benefit from utilizing the services provided by a MSP.

Does Your Business Really Need Merchant Services?

MSPs provide value added services, so businesses are not technically required to work with one. However, the benefits of working with an MSP often outweigh the costs. A few of the major advantages include:

Keeping You Connected – Merchants can’t legally have a “direct” relationship with providers like Visa or MasterCard. That’s where MSPs come in handy. They help businesses stay connected with the credit card associations and help to keep communication flowing.
Your Advocate Against Chargebacks – Most small businesses have to deal with chargebacks at some point or another, which can cause a lot of stress and lost profits. In the event of a chargeback, it’s critical for the business to react quickly. MSPs actively monitor account activity so that no wrongful chargebacks or errors slip through the cracks.
Providing the Support You Need – Let’s be honest: Credit card processing can be really confusing. MSPs provide your business with the expertise and resources you need to navigate through the complex world of changing compliance rules and new technology.

Don’t Settle for Less: How to Select a Provider

MSPs come in all shapes and sizes, so it’s important for your business to select one that’s a good fit for your business. Here are a few things to consider:

Longevity – Over the years, MSPs have gotten a bad rap for being rather “slimy,” but they’re not all bad guys. One of the best ways to be sure you’re working with a reputable company is to take a look at how long they’ve been in business. Frequent “restructuring” isn’t a good sign in this business.
Accessibility – The only time you’ll probably need to call your MSP is when you run into a problem that needs to be fixed ASAP. A great MSP will have 24/7 live customer service available to walk you through the most frustrating credit card processing challenges.
Top-of-the-Line Technology – In today’s super speed world, you’re going to want to work with an MSP that stays up-to-date on the latest payment processing technologies, especially with the EMV transition around the corner.

At the end of the day, merchant services providers can make credit card processing a whole lot easier for small businesses. They’re able to save you money by proactively managing chargebacks and fees, and keep the lines of communication open between the credit card companies and the businesses. As your small business grows and your credit card processing needs expand, an MSP can be there every step of the way to ensure a stress-free payment experience for you and your customers.

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Chargebacks

Keep Your Holiday Profits: Chargeback Prevention Tips

January 12, 2015 Abtek Leave a comment

The holiday season has once again come to an end. Whether your customers used in-store credit card processing systems or visited your ecommerce site, you don’t want to see your holiday profits whittled away by subsequent chargebacks.

Common Reasons for Chargebacks

Before we discuss how to prevent chargebacks, let’s look at the most common reasons that chargebacks occur.

Fraudulent card was used
Cardholder disputes merchandise quality
Incorrect amount was charged to the card
Errors occurred during credit card processing
Proper authorization wasn’t obtained

General Prevention Tips

Here are some general chargeback prevention tips that apply to merchants who accept online payments as well as swipe cards on POS systems.

Be sure the customer recognizes the business name you give to your merchant services company. Many chargebacks occur because customers don’t recognize the business name that appears on their statement.
Respond to retrieval requests in a timely manner. If you don’t respond within the number of days allowed in your merchant services agreement, it’s likely a chargeback will occur.
Get an authorization 100 percent of the time. Failure to get an authorization will result a chargeback.

Prevention Tips for Swiped Cards

Following are tips that merchants who process cards through POS systems or mobile merchant accounts can follow to lessen the chance of a chargeback occurring.

Swipe all cards through your credit card processing terminal. Doing so proves the card was presented at your store. If you have to get an imprint because your terminal is down, be sure all information appears: amount, business name, business location and signature.
Always compare the signature to the back of the card. Understandably your cashiers want to get customers through their lines quickly, but it only takes a few extra seconds to check the signature. Your cashiers should check the signature against a photo ID if there’s no signature on the back of the card.
Ask for another form of payment if the card is declined. Don’t continue to swipe the card.
Make sure the number on the screen and the credit card number match.
Get an authorization for the full sale amount – don’t break the sale amount into smaller amounts.

Prevention Tips for Online Businesses

Here are some helpful tips that online merchants can follow to prevent chargebacks.

Make sure your customer is giving you the correct billing address by using the Address Verification System (AVS).
Provide your merchant services company with a telephone number that it can print on your billing statement. This increases the likelihood that the customer will call you and determine what the purchase is before disputing it with their card issuer.
Use shippers that provide proof of merchandise delivery to the full billing address. This will help you in case of a dispute. Require a signature for expensive merchandise to be left with the purchaser.

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Chargebacks

Does Your Business Operate In One of the Top 5 U.S. Cities With the Highest Chargeback Stats?

December 11, 2014 Abtek Leave a comment

According to a recent report, the Top 5 U.S. Cities with the highest chargeback stats are:

Low, AZ
Port Washington, NY
San Jose, CA
Miami, FL
Astoria, NY

In many cases, this spike of chargebacks signals an alarming trend of “friendly frauds”–where a customer makes an authorized purchase, but then attempts to reverse it.

Beyond the Top 5, other cities also include Chicago, L.A., and Houston, among others. Which is why businesses need to consider a payment processor’s ability to fight chargebacks when they look to partner with one.

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Chargebacks

5 Tips for Reducing and Preventing Chargebacks

September 23, 2014 Abtek Leave a comment

When credit card transactions get reversed, it’s called a chargeback. Typically, chargebacks get initiated by the credit issuer at the request of the credit card holder. As a merchant, your first problem will be losing the funds from the transaction. You may or may not get the product or service back that you sold in the first place. However, getting credit card processing transactions reversed might cause other problems that could generate more headaches than just losing a sale:

You might not get your original transaction fee refunded.
Some merchant services charge an even larger additional fee for each chargeback.
Frequent reversals might result in even higher penalties or even getting your account terminated.

Most Chargebacks are Preventable

Visa, one of the largest credit card companies in the world, says that most reversal situations could be prevented with proper training and processing systems. It’s important to learn how you or your POS systems can catch risky transactions before they occur.

Do not accept or repeat a transaction after the initial request gets declined.
Respond to CALL requests from your authorizer, follow the instructions and document the authorization code.
Track and confirm delivery of physical products.
Publish clear refund and cancelation policies.
Respond to direct customer requests for cancelation of recurring services or refunds.

Your Customer Service and Refund Policies Prevent Chargeback Problems

With mobile merchant accounts and online payments, you have to reply upon your credit card processing system to properly validate transactions. However, you still need a clearly documented process for handling cancelations and returns. That way, your customers can call your own customer service number if they have questions or problems with a transaction. Typically, handling customer disputes internally is much better than waiting for reversals from credit card companies.

In some cases, your customer service representatives may be able to help your customer with an issue and prevent any request for a refund or cancelation at all. If not, it is still better to handle a refund or cancelation internally than it is to create a frustrated consumer who is likely to call his or her own credit card company to request a reversal. You might still lose a sale, but you will not risk chargeback fees, penalties or possibly even getting your merchant account terminated.

Finally, your clear refund and cancelation policies will direct customers to your business in the first place. In general, only frustrated customers end up calling their own credit card companies for help.

Abtek Helps Win the War Against Chargeback Issues

At Abtek, our professional compliance experts help new customers set systems up correctly to reduce the risk of reversals. If our clients run into problems, we are also there to support them. With over 17 years of experience in the banking industry, our compliance officer deals directly with clients and credit card companies to help fight reversals and educate clients about ways to prevent them in the future. Contact us today for more information.

Know the Facts

Verify

Ask for Proof

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Does Your Business Really Need Merchant Services?

Don’t Settle for Less: How to Select a Provider

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Common Reasons for Chargebacks

General Prevention Tips

Prevention Tips for Swiped Cards

Prevention Tips for Online Businesses

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Credit Card Processing and Merchant Account Solutions