Everything you need to know about holiday spending
Did you know that every dollar of fraud-related disputes or chargebacks costs businesses like yours an average of $2.94? That’s according to Chase and a recent report from LexisNexis Risk Solutions.
Not only that, fees related to each dispute can range between $25 to $100 per transaction. It’s no wonder that up to 42% of businesses challenge less than half of all disputes and 14% don’t bother to fight them at all. From customers initiating a dispute to banks withdrawing funds from the business to business owners challenging the dispute to banks validating it, the chances of a business winning a dispute are simply too low and the process is too time-consuming and expensive.
So how can you reduce disputes and save your business money and hassles? Here are six suggestions:
Use a recognizable name on card statements
Using a different business name can cause customer confusion and lead to unnecessary disputes.
Use accurate product descriptions
The more your customer knows about what they’re buying the less likely they’ll be disappointed and use the dispute process to ask for a refund.
Ensure your refund and return policies are clear
Clearly display them in-store and on your website and always provide customers with an easy way to return merchandise for a full credit.
Use delivery tracking
In particular, signature confirmation ensures you have proof your customer received what you sent them.
Use the most up-to-date card technology
Whether it’s chip-enabled or contactless tap-to-pay cards, these can reduce your liability for disputes – ask your payment processor about updating your terminals.
Use ID verification
Services like Verified by Visa® and Mastercard SecureCode® can help small businesses verify a card user’s legitimacy. You can also use address verification to match a cardholder’s address with their shipping address.
These strategies, as well as carefully documenting your entire sales process, may seem like a bit of a hassle. But the fact is they’re your protection from fraud and they can help reduce expensive and time-consuming card disputes. A Meridian Small Business Advisor is always here to provide you with the right answers, right away, on fraud or any other concerns related to your business – contact us anytime.
