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Tips for Winning a Chargeback Dispute

Chargebacks protect customers from losing their money to frauds or transactions that have not been authorized. However, they can be damaging to a business, as they take a lot of time. Plus, they are not easy to win. One needs to put effort to convince the bank to be refunded. Fortunately, there are some things one can do, which we will explain in this guide that can help them increase their chances of winning a chargeback dispute.

What is a Chargeback?

It is impossible to win something that you do not understand. So before we dive in into the tips, it is essential that we understand the concept of a chargeback. A chargeback scheme protects the customers by enabling them to file for a complaint against the merchant if the client does not recognize a transaction in his or her statement.

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Once a customer makes a chargeback request, the bank will investigate and come into a conclusion. If you are a seller, and a client makes a complaint about you, you should arm yourself with enough evidence to prove that the transaction was legitimate otherwise the bank will take away the money from your account and give it back to the customer.

Tips for Winning the Dispute as a Merchant

The credit card chargeback and all other cards chargebacks are difficult to win as a merchant since the burden of proof lies with you, the seller. Most card networks report that only 21% of sellers win these cases. Although merchants can seek professional help, some prefer to handle the disputes on their own. In this situation, several things can be done to increase the chances of success, they include:

1. Understand the Process

It is quite impossible to win over a process that you don’t understand. Comprehending the chargeback process will help you take advantage of the loopholes and win the case.

But a chargeback process is a complicated one. It has strict deadlines, documentation requirement among others. Before you try to defend yourself, understand what you are going to face.

2. Keep accurate records and gather substantial evidence

Chargebacks were created in favor of the client, so the only way you are going to have a winning chance is by having compelling evidence to prove the legitimacy of the transactions. Always ensure that you maintain accurate records since the beginning of the transaction.

Woman pay with credit card in cafe bar

Document each transaction. From confirmation of emails and invoices to follow-up emails. And after delivery, remember to ask for the customer’s signature. If you back yourself with these documents, there is a likelihood that you are going to win.

3. Check the Reason Code

Each chargeback comes with a reason code indicating why the customer has filed a complaint against you. Knowing the reason will help you to prepare a defense mechanism for that filed chargeback. Because each card network has its set of reason codes, the indicated code may not provide accurate details of the exact reason for the complaint, but the dispute will be based on it.

4. Resolve issues as soon as they occur

Chargebacks are filed if the consumer has tried to negotiate with the merchant without success. Therefore as the seller, you can avoid these disputes by putting forward an effective customer service.

Indicate your contact details and make refund policies for the clients to see. Doing that, you will encourage customers to directly resolve their issues with you instead of going to the banks.

Merchants should do everything possible to prevent customers from filing chargeback claims. That includes improving customer service, ensuring that the goods reach the customer, and the condition of the product is the one you have described. You can also use fraud detection tools to prevent chargebacks from occurring. Chargebacks will cost your business a lot of money, and you will end up spending much time trying to prove your innocence instead of building your business. it is advisable that you always try to avoid them.