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Chargeback Management Software: The Right Tool for Avoiding Chargebacks?

chargeback management software y2payments

Chargebacks: they’re a serious problem no merchant wants to face today. They not only interrupt your revenue stream, but they also take up your time and energy. While you can fight them, the burden of proof is always going to be on you, and that may lead you to consider a few ways of avoiding these problematic transactions. Some look to  chargeback management software as the ideal option, but is it really the best tool when you’re building a plan for preventing chargebacks?

What Is It?

To understand why chargeback management software is such an important tool for so many businesses, first, it’s important to understand why chargebacks are such a problem. Google the phrase “what are chargebacks,” and you’ll get a quick overview of the issue. Chargebacks occur when a customer disputes the transaction. Often that means retailers either end up with a delayed payment or no payment at all for the goods or services involved.

Chargeback management software, then, is a way to help prevent the problem initially. While every company offers something a little different, typically this type of software involves real-time notifications and alerts as well as automated chargeback responses and representation in cases. Typically it also comes with data management and a better overview of what’s happening with chargebacks in your business.

Is It the Right Way Forward?

Chargeback management software is one of many tools you’ll want to keep in your toolbox to help you stay on top of your business’ needs. Start by looking carefully at the chargebacks that you face on a regular basis. Do others in your industry face the same issue or is this unique to your company? Use the reason codes attached to the chargebacks to help you better understand what’s happening in your business and why you’re experiencing these claims.

Don’t forget to do some research here. Chargeback rules are changing all of the time, as are the regulations that govern them. Read as much as you can so you have a better understanding of these changes and how they might affect your company.

What To Look for In Chargeback Management Software

If you think chargeback management software might be right for you, there are a few things you’ll want to consider. First, make sure the software includes the information you need to track and analyze chargeback activity for your business. Without that data, you may never solve a persistent problem. Second, look for automated chargeback response. It will save you quite a bit of time in the long run, and it may help increase the overall number of cases you win.

Additionally, ensure the software you select is updated on an ongoing basis. Remember that chargeback rules and legislation change continuously, and that means that the software you use to manage them needs to change just as frequently.

Finally, look at every company’s win rate. Most chargeback software programs will show you their win rate average to help you decide whether it’s a purchase you want to make. Some will go as far as offering you a win rate guarantee, though not all are willing to do so. A win rate average, though, will at least show you how many other merchants are succeeding thanks to that software.

Chargeback management software is one great way to keep your chargebacks in check and keep your business moving forward. Y2 Payments has a robust, real-time system that helps you look closer at what’s happening and assists with chargeback management, something that could save you time and money. To explore what Y2 Payments has to offer, please contact us today.

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Chargeback Protection for Merchants

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Accepting credit cards has become synonymous with finding ways of avoiding chargebacks for many merchants today. What are chargebacks? If you’re unfamiliar with the concept, chargebacks occur when customers contact their credit card company to dispute a charge on their cards. If the dispute is deemed to hold some merit, your merchant account is actually debited the amount of money in question (even if it has already cleared), and you have to pay chargeback fees, which can be as much as $100 in some cases. 

For many small businesses, finding merchant protection against chargebacks is nothing short of an absolute must. What can you do to end the problem for your company? These tips can help. 

Preventing Chargebacks

There are a number of things you can do to prevent customers from filing a chargeback with the credit card company.

  1. Understand why Chargebacks are Occurring: The single best move you can make is to take a look at the data you’ve already gathered on chargebacks. If a common theme emerges, you can address that problem immediately. If the chargeback reason codes are all over the place, you may have to address issues in several areas. 
  2. Create Stronger Policies: If customers don’t understand your purchase policy, your restock policy, your return policy, or even your subscription policy, they’re going to get frustrated. What often happens when customers get frustrated is that they don’t know where to turn, and one of the easiest, fastest ways for them to deal with the problem is to contact their credit card company and get their money back. You can avoid all of this if your policies as far as shipping, billing, and returns are carefully worded on your site and easy to find. Many sites even put a little info section next to their product or service description so customers understand what they’re purchasing. 
  3. Build Better Customer Service: What happens when a customer contacts you? Your team and policies with regard to customer service may need to be revamped as well. Make it easy for customers to reach out to you. Offer a phone number, 24-hour chat service, an email address that you check regularly, or even social media links to help better connect with customers. Not only will this step help to prevent chargeback problems, but it may also increase your brand’s credibility, and that could lead to repeat customers. Just remember that rapid replies are essential. They’re already frustrated when they reach out to you. Be ready to help as soon as possible. 
  4. Consider Shipping Updates: If you sell physical products, be sure customers know when their items have shipped and how soon they should arrive at their doorsteps. There are many automated services you can deploy to do this for you, and the more insight you can offer customers, the more likely you are to avoid shipping related chargebacks. 
  5. Beef Up Anti-Fraud Tools: Fraud happens, and it can actually create more chargebacks than you’d imagine. While criminal fraud represents the minority of those chargebacks, friendly fraud happens quite often. Sometimes it’s buyer’s remorse. In other cases, they just don’t know how damaging it is to the merchant at the other end. Either way, use the anti-fraud tools you have at your disposal. Address verification, customer blacklists, and more can all help you prevent problems. There are lots of antifraud platforms, too, that can help you build a more robust strategy. 

A Note About Subscriptions

If you’re one of the many merchants who offer subscription-based services, you need to recognize that you’re at real risk for chargebacks. It should be an opt-in option if possible. Ensure you make it incredibly easy to cancel those subscriptions, too. Additionally, you need to ensure the description that goes to a customer’s credit card statement helps identify what’s going on. If you have another name that you’re doing business as, it should be part of what actually gets charged to a customer’s card. Furthermore, customers should know what that charge will look like on their cards. 

The Moral of the Story

Chargebacks happen, but they don’t have to happen to you. At Y2 Payments, we have a number of solutions aimed at preventing chargebacks. Contact us today to learn more about how we can help. 

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How to Reverse Chargebacks

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Handling chargebacks is a process fraught with frustration. You have to convince the bank that a chargeback dispute isn’t legitimate. It’s difficult – the system is built to favor customers for some good reasons. However, when credit card chargebacks should be reversed, it’s difficult to get it done easily. There is chargeback protection for merchants, like chargeback insurance. Let’s start from the beginning about what you can do.

Challenge the Chargeback

The most important step is to dispute credit card chargebacks when there’s a good reason to do so. If you absolutely know the customer’s in the right, and wasn’t provided a product or service, then don’t waste your and their time. However, if you’re in the right, then challenge that dispute. Most merchants either challenge fewer than half their chargebacks or never contest chargebacks. You should challenge every chargeback that you feel shouldn’t have been made. There’s evidence that this helps reduce the overall number of chargebacks you’ll face down the road.

Chargeback Insurance

Chargeback protection for merchants is available in the form of chargeback insurance. It was mentioned above that many chargebacks are made legitimately. These could be the result of stolen credit cards or credit card information, for instance. In this case, a merchant with chargeback insurance has protection. Such insurance policies may only cover transactions made through a particular payment processor, so be aware how and when you’re covered.

Chargeback Time Limit

Remember too that there is a chargeback time limit. Cardholders in general only have 120 days to file a chargeback related to fraud. There are time limits set up for every step of the dispute and challenge processes as well. Make sure you’re aware of all the time limits at play – they’ll vary by card and other factors – so that you’re able to assess the dispute’s legitimacy as well as your own timing and ability in responding.

For more information on Y2Payments Chargeback protection and how it works, contact us today at 888-693-1850.