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What are “Chargebacks” and what are some ways to prevent them from happening?
What is a Chargeback?
Chargebacks are essentially refunds. It’s the term used to describe the reversal of funds when a consumer complains to their banking establishment over a specific charge / transaction on his or her credit or debit card.
The main idea behind chargebacks is to protect the cardholder at all costs from fraudsters and any other kind of unauthorized payments or theft.
It goes a little like this:
The consumer files a complaint with their bank over a specific charge, the issuing bank then investigates the validity of the claim; if the bank feels the complaint is valid and legit, the financial institution will then take the money directly from the merchant’s account and give it back to the consumer.
So, what’s the main difference between a chargeback and a refund?
The main difference is that the merchant has absolutely no say in the refund process that occurs during a chargeback.
So, how the heck can we prevent Chargebacks from happening?
- Don’t Mislead
- Detail the Product Well
- Go for Quality over Quantity