UNDERSTANDING THE COST OF A CHARGEBACKS (1)

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UNDERSTANDING THE COST OF A CHARGEBACK

• The entire merchant industry has been suffering
  in terms of revenue due to fraud. According to
  annual study, the average lost in revenue in
  relation to fraud is about 1.32. This is a
  massive 94 increase compared to the result of
  the previous year. This recent boost highlighted
  the need for chargeback prevention.

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THE COST OF A CHARGEBACK

• Chargeback can be referred to as a disputed
  transaction from the debit/credit card holder.
  The cause of chargeback may vary it can be a
  failed delivery, quality of services, quality of
  product and fraud. Chargebacks has been created
  as an added security for the consumers against
  different types of fraud for instance, in case
  there are unauthorized purchase or if their
  credit card was stolen from them. It is a
  significant problem on the part of the merchant,
  wherein most of the accounts of the reversal
  resulted to massive amount of fines and expenses.
  This is why most of the merchants are doing a
  risk management to fight chargebacks.

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Double Penalty

• The merchant will not only liable to pay for the
  loss fund. Basically, the merchandise sent will
  be lost, and on top of that, they will be
  responsible in handling the chargeback penalty
  which is commonly about 10-50. The chargeback
  fees will be settled regardless if the appeal on
  chargeback was won or not.

Interchange Fee
This is an additional fee that the merchant needs
to shoulder. The merchant will be compelled to
settle the interchange charges on the initial
order which is about 2-5. There are certain
regions particularly in Europe that will charge
those who are acquiring chargeback with an
additional 13 which will be passed on the
merchant. Aside from that, the merchant will
also be responsible for the extra overhead
expenses in investigating the fraud.
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Long Process

• Due to the multiple processes, the merchants are
  not commonly informed about the chargeback within
  180 days after the sale has been initiated.
  During this time, it will be impossible for the
  merchant to cancel the delivery process to
  prevent any chargeback fees. There is a bank
  policy that is against challenging the disputes
  that is about 6-month old. However, according to
  the law, the bearer of the card has at least 2
  years to file for chargebacks.

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• Merchant have been losing revenue due to
  chargeback. Customers are costing the merchants
  around 11.8 Billion annually due to the
  excessive chargebacks. Credit Card Company is
  also assigning fees to the merchants who have a
  fraud rate of at least 1. They can be liable to
  pay for a 5,000 for the unreciprocated
  documentation, 10,000 if their chargeback
  prevention system is not properly instituted and
  others. The excessive cost is why most companies
  are seeking the help of Chargeback Management
  Company to mitigate the chargeback fees.

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CONTACT US

• address 10300 49th St N 427, Clearwater FL
  33762
• Phone [phone]
• Email app_at_chargebackexpertz.com
• https//www.chargebackexpertz.com

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