5 Easy Ways to Avoid Card-Not-Present Chargebacks

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When merchants accept credit cards, the margin for error resulting in a chargeback is surprisingly large, particularly with card-not-present chargebacks.

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When merchants accept credit cards, the margin for error resulting in a chargeback is surprisingly large, particularly with card-not-present chargebacks. E-commerce merchants, especially those in danger of losing their merchant account because of chargebacks, sometimes need to step back to square one and examine each step of the transaction and identify the loopholes where errors can occur. 

5 Ways to Avoid Card-Not-Present Chargebacks

E-Commerce merchants operating in a card-not-present environment need to be diligent in observing their transactions, requesting pertinent information and taking extra steps that will undoubtedly result in a lower chargeback rate. Below are five sure-fire ways to reduce card-not-present chargebacks.

Get Those Digits: Asking for the 3 digit code on the reverse of a credit card in a card-not-present transaction is further proof the consumer is who s/he says s/he is.

Work with a reputable shipping company: A reliable shipping company is a game-changer in avoiding chargebacks. Particularly, in instances of friendly fraud, the shipping company is a vital source of information with tracking, arrival dates and receipt signatures to prove the merchandise was delivered.

Clear Billing Descriptor: An unclear billing descriptor might be the most common cause of card-not-present chargebacks – consumers often forget about making the purchase. Merchants should think of the billing descriptor as the consummate reminder of the purchase to the consumer.

Clear, Conspicuous Return Policy: Instabill copywriters have incessantly preached a prominent return policy on the front page of an e-commerce website. The policy should be clear to consumers, and also inform them why a refund is preferable to a chargeback.

Ship First…Then Charge: When e-commerce merchants charge a credit card before the merchandise reaches the consumer, it plainly sends the wrong message: That the merchant is simply anxious to process the payment. The small event that the consumer sees the charge on the billing descriptor before s/he receives the merchandise is an invitation to a chargeback.

The Time to Secure Your Merchant Account is Now

As consumers are issued the new EMV chip-enabled credit cards over the next year, card-not-present fraud is expected to escalate dramatically as fraudsters will turn their attention to e-commerce businesses.

Instabill offers a plethora of safeguards including 3D Secure Processing as well as resources to make your internet merchant account PCI DSS 3.0 and 3.1 compliant. Click the live chat option below to connect with a live merchant services representative.


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Jul 30, 2015 Category: General Posted by: Marketing
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In Chargebacks 101 for Merchants, Instabill teaches business owners about the chargeback process and chargeback reversal process. Instabill also offers advice on how to prevent chargebacks as well as credit card fraud.

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In Chargebacks 101 for Consumers, Instabill clearly identifies the similarities and differences between refunds and credit card chargebacks. Consumers can learn what situations are best for each type of transaction.

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