#stop chargebacks

Chargeback Account Handling

Sometimes, a chargeback can be a lot for a merchant and we are continuously trying to offer the best clarification to manage and reduce them.

Along with that, the chargeback of each month needs to be filed with proper information. However, this process is time-consuming, expensive, and difficult to understand.

Challenges Which Occurs In  Chargeback Accounting?

When it comes to chargeback accounting you need to start from the beginning, which could be challenging for the merchant.

•Get prepared for the lengthy accounting process

As you know, the chargeback processing takes times, it included a number of entities playing their part.

There is a merchant, merchant’s bank, customer’s bank, customer, gateway, and card network. When a dispute occurs, each of these entities has a part to play, which obviously takes time.

•Accounting Can Be Tricky

Accounting the transaction is a tricky process in its own and chargeback accounting adds more to it. Each and every chargeback is different and needs special attention. To Handle Chargeback Accounting properly, you need experts.

You can contact Chargeback Expertz for such matters and clear out the confusion revolving it.

•Prevention Is Better Than Cure

If you are able to avoid chargeback, none of these issues will occur. This means the successful prevention of chargeback can save a merchant from a number of troubles.

Here are some tips to avoid chargeback:

•Keep a keen eye on customer service

•Revise the return and refund policies as per your product and services.

•If you avail the shipping facilities, make sure the terms are clearly understood by each customer before the purchase.

Taking the right steps toward customer satisfaction is the key to avoid and reduce the number of chargebacks.

The chargeback account handling will automatically become easy if there are a low number of chargebacks. Find assistance to Handle Chargeback Accounting at Chargeback Expertz.

ChargebackExpertz

For a merchant, the true cost for a chargeback is sometimes twice bigger than the cost of the product or service. If you handle chargeback disputes efficiently then you will surely notice some improvement.

However, sometimes, merchants need some assistance with chargeback management. This can be done by hiring a chargeback management firm or creating a chargeback management unit in your company.

Find The Route Cause.

If you wish to handle chargeback dispute in your business then you need to start by knowing the reason behind the chargebacks. Not just that, you are also required to educate yourself with the chargeback reason codes of the various credit card networks such as Visa, MasterCard, American Express, and Discover.

Resolve Disputes

If you know that the chargeback is caused due to your mistake, you need to simply accept the chargeback.

On the other hand, if this a case of chargeback fraud then you need to file Representment and challenge the case.

· Authorization of Transaction – In order to complete a transaction, the merchant should have proper authorization from the customer and issuing bank. If a merchant completes the transaction without proper authorization then the chargeback is valid. This means if you are a merchant then make sure you have the authorization before completing the payment process.

· Transaction Receipt – Mode of Payment and Payment Processor play an important role. If the transaction is carried out using the services of a payment processor then you can simply contact the payment processor to make sure that there are no payment related issues.

·Terms and Conditions – Every business has some terms and conditions and you need to tell your customers about these terms before the purchase. This resolves the cases of friendly fraud in the business.

Clear Chargeback Representment

Here are some tips to prepare a Chargeback Representment:

Compelling evidence is necessary. If you are going for Representment then you must have evidence against the filed chargeback. If this is the case then you would have to focus on that evidence.

Other than that, you need to provide details of the transaction, including delivery delated information, if any.

Never prepare a really bulky Chargeback Representment report. Just add the required minimum information for ease to understand.

Chargeback Expertz

Issuing bank received the complaint from the customer that goods or services he purchased are defective, damaged or not fit the expectation of the customer. Customer claims that policies explained verbally by the merchant during purchase were different and that what he received was different than expected.

Some Causes

Wrong merchandise/goods sent to the cardholder.

During shipment, goods got damaged.

The goods or services were described inaccurately.

The services purchased by the cardholder weren’t canceled on time.

The services did not perform as it was described.

The returned merchandise was not accepted by the merchant.

The returned merchandise accepted but merchant did not issue a credit to the cardholder.

Counterfeit consumer goods.

Necessary Evidence

If goods were returned or services were canceled, the merchant must provide the bank with all the information or evidence of the refund.

If the merchant hasn’t received the returned goods or the cardholder has not canceled the service, inform the bank. The cardholder must make a valid effort to return merchandise or cancel the service. The merchant must ensure that the incoming shipments are recorded to later verify.

If the cardholder’s complaint is legal and the merchant has received the goods, but have not refunded the amount, he must accept the chargeback. Do not process a credit until the chargeback has performed this function.

If the goods were accurate and as described, provide the merchant bank with specific information and invoices to deny the cardholder’s claims.

If merchandise was damaged and it was returned, provide evidence that it was repaired or replaced.

How to do Prevention?

Make sure that the policies regarding the merchandise or services are explained clearly, these should be delivered in the manner they are supposed to be delivered or as mentioned in terms and policies.

Make sure that orders are placed correctly and arrived perfectly. It must be reviewed and checked regularly during the delivery process.

The staff must be trained from time to time on how to accurately file an order.

The buyers must be notified of every cancellation request, credit or refund in order to reduce the possibilities of chargebacks.

Related Example-

Description

Mastercard has been issued a global liability shift program for ecommerce transactions. A chargeback is filed for this reason when an acquirer bank processed a transaction for a credit card accepted and later recognized in the list of Mastercard violation.

Most Common Causes

The merchant:

The transaction falls under the Global Security Bulletin of Mastercard.

The acquirer name, acquirer ID, merchant name and its location are lister in the Global Security Bulletin under Global Merchant Audit Program (GMAP).

The issue is not resolved within time frame specified in the procedure manual and in security rules.

The issuer did not report the transaction under SAFE within time frame.

The transaction is not processed within the specified period in merchant agreement.

Evidence Required

If the first chargeback was correct and the acquirer bank failed to change the dispute properly, the issuer may continue the chargeback with the same reason code originally processed.

If the acquirer bank lost data file requested submit the form found in the back of the procedure manual and security rules.

If the situation requires any other reason, the issuer must process the arbitration chargeback using the proper reason code.

Prevention

Process all the transactions at hybrid terminals.

If found counterfeit fraud reports it to SAFE product user guide of Mastercard.

Keep a record in a chip transaction and authorization message request should be approved by the issuer.

The time frame for these chargebacks is 120 calendar days from the Global Security Bulletin publication date.

Description

Mastercard has been issued a global liability shift program for ecommerce transactions. A chargeback is filed for this reason when an acquirer bank processed a transaction for a credit card accepted and later recognized in the list of Mastercard violation.

Most Common Causes

The merchant:

The transaction falls under the Global Security Bulletin of Mastercard.

The acquirer name, acquirer ID, merchant name and its location are listed in the Global Security Bulletin under Global Merchant Audit Program (GMAP).

The issue is not resolved within the time frame specified in the procedure manual and in security rules.

The issuer did not report the transaction under SAFE within the time frame.

The transaction is not processed within the specified period in merchant agreement.

Evidence Required

If the first chargeback was correct and the acquirer bank failed to change the dispute properly, the issuer may continue the chargeback with the same reason code originally processed.

If the acquirer bank lost data file requested submit the form found in the back of the procedure manual and security rules.

If the situation requires any other reason, the issuer must process the arbitration chargeback using the proper reason code.

Prevention

Process all the transactions at hybrid terminals.

If found counterfeit fraud reports it to SAFE product user guide of Mastercard.

Keep a record in a chip transaction and authorization message request should be approved by the issuer.

The time frame for these chargebacks is 120 calendar days from the Global Security Bulletin publication date.

Description

Mastercard has been issued a global liability shift program for ecommerce transactions. A chargeback is filed for this reason when an acquirer bank processed a transaction for a credit card accepted and later recognized in the list of Mastercard violation.

Most Common Causes

The merchant:

The transaction falls under the Global Security Bulletin of Mastercard.

The acquirer name, acquirer ID, merchant name and its location are listed in the Global Security Bulletin under Global Merchant Audit Program (GMAP).

The issue is not resolved within the time frame specified in the procedure manual and in security rules.

The issuer did not report the transaction under SAFE within the time frame.

The transaction is not processed within the specified period in merchant agreement.

Evidence Required

If the first chargeback was correct and the acquirer bank failed to change the dispute properly, the issuer may continue the chargeback with the same reason code originally processed.

If the acquirer bank lost data file requested submit the form found in the back of the procedure manual and security rules.

If the situation requires any other reason, the issuer must process the arbitration chargeback using the proper reason code.

Prevention

Process all the transactions at hybrid terminals.

If found counterfeit fraud reports it to SAFE product user guide of Mastercard.

Keep a record in a chip transaction and authorization message request should be approved by the issuer.

The time frame for these chargebacks is 120 calendar days from the Global Security Bulletin publication date.

Merchant was unable to verify the authorization code of the transaction at the time of purchase. A card-not-present transaction occurs when cardholder files a complaint that he/she neither participated nor authorized a particular charge. A card-not-present transaction occurs on a fictitious account number on which owner’s authorization was not obtained. Telephone sales, mail-order, Internet/online sales, monthly subscriptions, recurring and prepayment transactions are examples of card-not-present transactions. Mostly this situation occurs when someone fraudulently uses someone else’s credit card and processes card-not-present transaction without the consent or permission of the cardholder. Sometimes, cardholder does not recognize a card-not-present transaction on his statement because of the invisible, unclear or confusing merchant or product name.

Most Common Causes

POS device was not authorized for strip-read, online and face-to-face transactions, but only card-read or key-recorded transactions.

The transaction was not approved.

The card provided a service code of X2X (Positive Online Authorization-Only), but the transaction was not approved.

The transaction amount passed the limit from the floor limit that was installed by MasterCard at the time of purchase and was not approved.

The authorization request was denied or the transaction was made by an expired card.

If not authorized by Technical fallback and CVM fallback transactions.

The merchant processed a fictitious account number on which card owner’s authorization was not obtained.

The merchant processed a transaction card owner did not participate in.

The transaction is processed on the invalid card using an account number.

A family member ordered from the primary cardholder’s account without his permission.

It is also caused by the owner of the card not able to recognize purchase on the billing statement.

Evidence Required

The merchant should provide the document that business did not need to authorization.

The merchant may present the document that the cardholder obtained authorization for the transaction amount.

Providing the amount that was authorized, authorization approval code, and the date of the authorization the merchant should document the incomplete authorization

The transaction was below the issued floor limit and there was communicate failure to buyer or failure to POS device at the time of buying, the merchant should present document.

Prevention

The buyer’s bank found incorrect transaction amount or account number mismatched with the posted information with them and the information on the order receipt. The transaction was processed with the incorrect account number, incorrect transaction amount and/or had an error while calculating transaction amount without cardholder’s permission or the merchant altered amount after the order was processed without notifying to the cardholder.

Most Common Causes If the merchant

Entered wrong account number.

Entered wrong transaction amount for that particular transaction.

Altered the amount after getting the signature from the customer.

Made a mistake while calculating the amount.

Exchanged the amount after completing the transaction without taking permission from the cardholder.

Increased the transaction amount without getting any consent from the cardholder.

Evidence Required

Provide documents to the acquirer bank describing the product, the transaction amount and the account number on the order receipt are same as acquired information.

Accept the chargeback, if account number or transaction amount is different from the order receipt and the information posted.

If disputed chargeback for the incorrect transaction amount, the merchant should process a new transaction within 30 days from the original date, however, if chargeback already has performed its function never issue a refund for that particular transaction.

No action needed if the customer dispute chargeback for the incorrect amount.

Prevention

If the business accepts cards, swipe it or manually enter the account number, however, make sure that the account information is used from the face of the card on the order receipt.

Ensure to use a standard printer to print the order receipt.

If the cardholder has signed an order receipt, the merchant should not exchange or alter it.

If chargeback was imposed on an incorrect amount, the merchant must try to communicate with cardholder to adjust the order receipt to show up the correct amount.

Compare the key-entered to make sure that the transaction information typed is accurate.