Fighting holiday chargebacks means 'going on record'

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With Black Friday and Christmas being such big shopping occasions, the likelihood of chargebacks grows exponentially. To fight them, the best defense is a good offense.

The chargeback process often only allows merchants one to two weeks to file paperwork necessary to contest the chargeback, and most businesses lack robust documentation that proves a purchase was intentionally made.

It might seem especially overwhelming during the holiday season to challenge a large volume of chargebacks. But with better recordkeeping and well-designed agreements, the fight is more in your favor.
Tell customers upfront what they’ll be charged for and how often. Transparency goes a long way in helping merchants keep their money. Including language about auto-renewals or how often a customer will be charged for a good or service in the text below/near the signup or checkout button is another conspicuous way to notify customers of the future charges. This way, before they complete their purchase and get your hopes up, they have a chance to reconsider, or at least become aware of recurring payments.

Rather than hide crucial terms about an auto-renewal policy in your clickwrap Terms of Service (which may or may not be enforceable), make the auto-renewal clause its own clickwrap. That is, during the sign-up or checkout flow, in addition to having users accept your Terms and Conditions and Privacy Policy, include another clickwrap agreement which users check to indicate that they understand they are signing up for a recurring fee.

Rather than just accepting all the chargebacks disputes, be prepared to fight them via representment with excellent recordkeeping. To successfully dispute a chargeback, merchants must be prepared to present compelling evidence proving that the purchase was intentional and that there was no error on your part, including credit card information, data stamps with IP addresses that can be cross-referenced with past transactions, and information about terms/contracts accepted during the checkout process.

Because of the short turnaround required for chargebacks, it is crucial that businesses maintain robust recordkeeping with the ability to pull records quickly. Without these records, you will have a hard time recouping the money you'd lose to chargebacks.

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