Customer disputes and chargebacks are very costly to eCommerce merchants in terms of both time and money. Disputes are time consuming to resolve, and when left unresolved…turn into expensive chargebacks! Chargebacks typically cost $25 per incident, and you will also lose the funds associated with the sale, which must be paid back to the cardholder…namely your customer! Retrieval Requests also sometimes occur; this is a request by the issuing bank for a copy of the signed charge ticket and carries a fee of $10 per incident. Bear in mind, as a merchant accepting credit cards for your goods or services you have agreed to abide by Visa/MC’s rules which (perhaps unfairly) are often slanted in the favor of your customer! There are a couple of main causes for cardholder disputes:
- Customer expectations not met due to misinterpretation of products or services.
- Merchant’s Doing Business As (DBA) name was not recognized on the cardholder’s statement.
These can be effectively addressed with clear and specific Product/Services info and clear Policies and Procedures.
Customer Expectations
It is important to keep in mind that as a Visa/MC merchant you have agreed to abide by Visa/MC’s regulations. To that end, you sometimes have to throw “common sense” out the window when creating “policies” and marketing your products or services.
Visa/MC will allow any cardholder to chargeback a purchase if the customer can demonstrate to ANY degree that they have not received the products or services promised by your company in the quantity, quality & time frame promised.
In other words, if your company promises product or services delivery on Tuesday, but the product or service is not delivered until Wednesday (a day late), that cardholder can probably charge that sale back with little you can do about it.
Likewise, if the quantity or quality of products or services delivered are not exactly as described on your site or in other marketing materials, the cardholder will be allowed to chargeback the purchase.
It is not always fair, but if anything is left unclear, it almost always falls to the favor of the cardholder. For your protection and success, we strongly encourage you to spell everything out clearly and take nothing for granted, even the obvious.
Merchant’s Doing Business As (DBA) name was not recognized on the cardholder’s statement.
A dispute or chargeback can occur when your customer does not recognize your business name on their monthly statement from their Card Issuing Bank.
Please make sure the name on your merchant account is clearly evident on your Web site.
1. You may add a notification like this to your order pages, FAQs or shopping cart:
“Please make a note that a charge from “MerchantDBA” will appear on your credit card statement for your order amount.”
2. You can also send an email upon the placement of each new order such as this:
“Thank you for ordering at (MerchantDBA.com), your order number is (12345).
Once your order is shipped, you will receive another confirmation e-mail from (UPS/FedEx/USPS) with your tracking number.
Also, please make a note that a charge from “MerchantDBA” will appear on your credit card statement for your order amount.
If you should have any questions regarding your order, please reply to this e-mail or call (MerchantDBA), at 888-877-1234 from Monday through Friday, 8:00 am to 5:00 pm (Your Time Zone) time.”
