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What Are Chargebacks

A chargeback happens when a cardholder calls his card issuer to dispute a charge on his account. If your customer files a dispute.  You’ll get a notice from your acquiring bank that a chargeback is pending. You can either accept it or request it. If you accept it or if the acquirer or card issuer denies your request you will get a chargeback.  And it’s not good for your company.
The cause of the disputes can vary from the customer being dissatisfied with his purchase. A customer not being able to identify the transaction. And a customer not permitting the transaction to a customer reporting a fraudulent transaction.

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When a chargeback is received.  You will get a chargeback reason code from the issuing bank that gives a reason for the dispute.

These few scenarios in which chargebacks are inadvertently or intentionally abused:

Accurate Fraud occurs when a thief who acquired the card information either through a lost or stolen card. A terminal skimmer or an online hack uses a credit card.

Affable Fraud occurs when a cardholder files a chargeback due to forgetfulness.  Inability to recognize a purchase or card use by a family member or friend. The chargeback is filed without ill intent.

Chargeback Fraudoccurs when a chargeback is filed to receive a refund without having to return the item. This is virtual shoplifting because the buyer keeps the product without paying for it if the chargeback is processed.

Chargeback Process

A customer disputes a transaction by get in touch withhis bank.

  • For most transactions, cardholders have 120 days from the transaction date to dispute a charge.
  • The card-issuing bank gives a provisional credit to the customer for the transaction amount.

Merchant Notified of Chargeback Received

  • The chargeback amount is debited from the merchant’s account and the merchant is informed via email using the email address. Where settlement summary emails are sent.
  • Chargeback details will show up in the merchant portal.
  • The merchant will be charged a non-refundable chargeback fee, which canvary as per the Acquiring Banks.

Merchant Response

Re-present – The merchant typically has 7-30 days (depending on the card network i.e. MasterCard, Visa, Discover, American Express) to answer to the case by giving supporting documentation.

Accept – The merchant can choose to “accept” the chargeback and permit the funds to be refunded to the cardholder. The chargeback will be automatically accepted if the merchant does not reply by the answer date.

If you are looking for a Chargeback Management Company, there are several things you’ll want to consider. Some of them are as follows:

  • Do you need non-manual help? If yes, then merchant should hire a good chargeback management company.
  • What will a chargeback management company do? All chargeback management companies are different. But the best solution will address both sides of the chargeback issue: prevention and representment (disputing chargeback to recover revenue).
  • What kind of results can you expect? There are two sides of chargeback management; you’ll want to evaluate the reduction of chargeback issuances and the chargeback dispute win rate.
  • How will chargeback management software combines with your current platforms?. The chargeback management company shouldn’t be able to access your lead lists or other tactful customer information. However, the company should be prepared to have dealings with processors. Gateways, etc. for integration and ongoing management efforts.

Do You Need Chargeback Management Help?

If you are looking for a Chargeback Management team then you can contact Chargeback Expertz. Start your project with us. We’d love to work with your business. Reach out to us at our toll-free number- +1 (888) 901-8653 or visit https://www.chargebackexpertz.com/.

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