MERCHANT STRONGHOLD MERCHANT STRONGHOLD IS THE #1 HIGH RISK MERCHANT SERVICES PROVIDER
BY APOORV JOSHI
How Chargebacks Affect Merchants? Are you new to the eCommerce business world or thinking about starting an online business? Or even contemplating expanding your existing business by opening an online store? If so, you must become familiar with the chargeback system. Just for the simple reason that unchallenged chargebacks have the potential to significantly reduce your profits from online sales and can even threaten the future existence of your business.
Chargebacks Affect Merchants In simple terms, a chargeback is a method consumer can use to reverse (nullify) credit card transactions they deem unlawful, such as charges incurred because of cyber theft or unauthorized use and dishonest merchants looking to take advantage of a consumer. If you have ever disputed a charge on your credit card statement or questioned a debit from your bank account, you may already be familiar with chargebacks. The chargeback system is in place to help consumers feel safe when making online payments. In 1968 the United States passed the federal “Truth in Lending Act” and the “Consumer Credit Act 1974” was enacted by the United Kingdom. Both of these laws were specifically designed to promote the informed and safe use of credit cards.
Three Common Reasons for Chargebacks The chargeback system exists for the safety of cardholders and the process is more likely to protect the consumer than the merchant. One common reason for chargebacks is consumer dissatisfaction with products or services consumption. For example, a merchant might create a tempting online description to easily sell products or services. But, when delivered, the consumer finds that the product or service is not as described or what they expected. The risk of chargebacks from dissatisfied consumers encourages merchants to focus on providing the best consumer experience and products or services possible.
How Chargebacks Affect Merchants Merchants need to take chargebacks seriously. Reason being, they have the power to negatively affect a business’s bottom line and its eventual survival. Left unchallenged, a merchant faces fee assessments of $100 or more for each chargeback filed. Often, these fees create a loss far greater than the initial product cost. Additionally, if the number of chargebacks deemed valid exceeds a predefined threshold. The merchant may have to go for high-risk merchant accounts which come at a higher cost. Or, merchant accounts can be frozen or terminated, leaving the merchant without a way to process credit card payments.
Steps to Help Avoid Chargebacks Provide quality products and services. Accurately advertise products and services. Have a knowledgeable support team to effectively defend against chargebacks. Provide great customer service. Have systems in place to prevent fraudulent credit card activity before it happens. Keep good transaction records.
Contact Information: Address: 10300 49th Street N Suite 427 Clearwater, FL 33762 Contact No: +1 (888) 622-6875 Fax Number: +1 (844) 465-4723 Email: info@merchantstronghold.com Website: https://www.merchantstronghold.com
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