A chargeback is just that. It’s when a customer wants to get a charge back, also known as a refund. Normally, a refund would not be something to worry about. But if you get above a 2% chargeback amount, the nerves of the merchant servicer begin to quiver. If you didn’t know, the merchant account servicer is responsible for the refund amounts if you go out of business and don’t cover your chargebacks.
It’s no wonder
It’s no wonder that merchant account servicers are so nervous about a chargeback. So, plan ahead and take charge if someone is not happy with a product or service of yours. If a chargeback gets around you, and the customer has called their cardholder bank, then you need to be on top of things. Non-compliance of you and your attention on a chargeback, could end your merchant account altogether. It’s so much easier to be a positive role model with this.
To avoid them altogether
Have some sort of policy in place that assures that the purchaser will come to you about issues. Route them to you and cover your bases. Depending upon whether it’s for a service or some merchandise, you get to decide how to handle it. If the customer goes into the purchase with their eyes wide open, you are less likely to have problems.
Less Likely
With that policy in place, all you need to do is take care of the customer. Talk to them and find out what has gone wrong. After you know this, proceed to make them happy. Find a way to satisfy them. You may just have to send them a refund, but they don’t have to have the money put back on their card. That doesn’t always make the customer dance with glee, but, if they knew this from the get go, you are covered.
Not taking on the issues
Small businesses have an easier time taking good care of customers, verses larger companies. Unfortunately, unless there is an incredible amount of training done, customers become a number in the larger stores. With the smaller companies, they still have a name and they still can have the personal touch. No matter the size of your company, try really hard to keep the small business feel. It only makes you the better business and you can get even more business from that. When you make cut backs on your customer service, you pay the price.
Stay under a threshold
Chargebacks are quite the balancing act. If you fall into the high risk area and credit card chargeback is inevitable, just follow the rules of engagement and take care of the customer. You need to contact them and take care of the issue. Ignoring it will cause you more problems, as stated above, and put you in merchant account jail. Since you don’t want a bad reputation, and the customer just wants taken care of, it behooves you to the right thing and fix it.
