At One Payment, we thrive on keeping our readers up-to-date on news pertaining to credit card processors! In this article, we will discuss chargebacks and how consumers can use them to their advantage.
Use Your Tools
As a consumer, how many times have you purchased a product, only to have to return it later? While returning an item might seem like a simple concept, the merchant has suddenly become difficult to work with. However, don’t despair. Consumers are able to utilize chargebacks, which essentially means that you dispute a charge directly with your card provider, and the transaction is reversed.
Why the Hesitation?
Interestingly, consumers are hesitant to use chargebacks, because they think that they can only be used for billing errors or incorrect purchases. Under the Fair Credit Billing Act, consumers are allowed to dispute a charge if they’re unsatisfied with the quality of the product, the amount of time it takes to receive the product, or if the merchant is being difficult to work with. However, most consumers are unaware of this fact.
As a retailer, chargebacks are the last thing that you want. Not only do you lose the money for the sale, but you will also incur various chargeback fees from your processor. As a result, your processing rates might increase. In some extreme cases, your card processor might drop your business if you have too many chargebacks.
Don’t Abuse the Privilege
Obviously, merchants would prefer to work out any disputes with their customer, but some customers go straight to using a chargeback instead of contacting the merchant. Overall, chargebacks tend to favor the consumer, but it’s important for consumers to utilize chargebacks as they were intended and to not abuse the privilege out of spite.