Three Common Reasons for a ChargebackAssociation of Business Training
July 10, 2012 — 1,082 views
In business, chargebacks are a common problem that many professionals wish to avoid at all costs. Unfortunately, customer disputes are all too frequent, and they come in a variety of forms. When a cardholder disputes a transaction or claims fraud, the issuer may request a detailed explanation of the problem from the cardholder as well as ask for a copy of the sales transaction from the merchant. Business owners can effectively reduce the odds of chargebacks occurring in their workplace by understanding three common procedural problems between a merchant and the issuing bank.
These are three common reasons why chargebacks occur today.
1.) Failure to respond to retrieval request - When a sales draft is requested, merchants need to provide the appropriate information within 10 days. A chargeback is generated when a merchant is unable to supply the bank with documentation in a timely manner.
2.) Denies transaction - When a consumer denies making or authorizing a transaction, he or she may choose to dispute the purchase. Timely submission of a sales draft will help business professionals avoid chargebacks.
3.) Improperly processed refund - When customers return purchases, they ask for a credit or a refund, assuming the charge will be removed from their credit or debit card. However, sometimes these refunds slip through the cracks and create problems down the line. In situations where this occurs, a chargeback is also noted.