Chargebacks 101: How to Protect Your Business from Fraud and Disputes

Chargebacks can be a nightmare for businesses that accept credit cards. When a customer disputes a transaction, funds are automatically withdrawn, and merchants must fight to recover their money.

Common Causes of Chargebacks:

• Fraudulent Transactions: Unauthorized use of stolen credit cards.

• Customer Disputes: Claims of undelivered goods or dissatisfaction with the product/service.

• Processing Errors: Incorrect transaction amounts or duplicate charges.

How to Prevent Chargebacks:

• Use EMV Chip Technology: Reduces counterfeit fraud risk.

• Clear Transaction Descriptions: Ensure billing statements match your business name to avoid confusion.

• Collect Proof of Purchase & Delivery: Keep records of signed receipts and shipment tracking details.

• Offer Exceptional Customer Service: Resolving disputes before they escalate can prevent chargebacks.

By taking proactive steps, businesses can reduce chargebacks and maintain healthy revenue streams.