PayThink

New tech can mitigate coronavirus chargebacks

Register now

It’s critical that merchants implement a COVID-19 strategy for avoiding, reducing, and disputing chargebacks to help recover disputed revenue and prevent future chargebacks.

One big way to do this is by using multi-layered fraud detection. All chargebacks are tied to one of three sources: Criminal fraud, friendly fraud, and merchant error.

Identifying the latter two sources is contingent on first eliminating the possibility of criminal fraud, which calls for a multi-layer, dynamic strategy.

Luckily, there are multiple complementary fraud detection tools merchants can employ, including Address Verification Service (AVS), CVV verification, 3-D Secure, and geolocation, just to name a few.

Also, share your contact information. Merchants want customers to contact them before calling the bank. Make customer service information easy to find and navigate. Include phone number, email address, and social media information on every page of an e-commerce website.

Optimize your response. Merchants need to remove barriers between themselves and their customers wherever possible.

Providing excellent customer service means round-the-clock, fast (less than one hour) responses to all email, social media, and SMS queries, and answering all phone calls in less than three rings.

Consider contracting a third-party answering service to provide overflow support.

Deploy smarter chatbots. Chatbots can help offload simple queries that don’t require live responses. Chatbots should fill two key functions: to answer very simple questions that don’t require human interaction, and quickly and efficiently direct more complicated questions to the proper service channel.

Always follow the rules and regulations set forth by payment networks. In addition, abide by certain key best practices. Submit copy requests in a timely manner. Ensure sales receipts are legible. Settle payment batches promptly, and never attempt multiple authorizations after receiving a decline.

If the customer asks to discontinue a service or refund a purchase, grant the refund or cancellation quickly. Make it a simple and no-strings-attached process. Also, be sure to inform the customer once the cancellation or issued credit is made. If an item is backordered, let the customer know. Give the customer the opportunity to cancel rather than wait for a delayed arrival.

Managing chargeback risk is difficult under the best circumstances. With fear and anxiety about the coronavirus outbreak running high, it’s more critical than ever that you be proactive and take steps to prevent and fight disputes.

For reprint and licensing requests for this article, click here.