Do you have a dispute and fraud prevention strategy at your business? Creating a strategy and using some best practices can help you prevent fraud from occurring and reduce chargebacks and potential customer losses.
Clear and Timely Customer Service
Contacting your customers in a timely manner with clear communication can help prevent many of the reasons for disputes. If your customer has an issue and a refund or replacement is needed, acting fast will help reduce the likelihood that the customer will opt to dispute the payment. Customer Support information should be easy to find. Using tools such as PaidShipping's email notifications for pick-ups and deliveries will keep your customers informed of their order status.
Don't forget to include clear policies for cancellation and refund in your terms of service. If you can set up your orders so that your customer is required to agree to terms of service, this will increase the likelihood that an issue will not develop into a card dispute.
Terms and Conditions
Your policies and terms of service should be easy to find on your website. It is also better that your customer is presented with a full version of the policy rather than a link. On your checkout page have a pop-up that displays the full version which requires agreement before an order is submitted.
Track Shipping
If you are shipping, make use of online tracking and delivery confirmation options where possible. PaidShipping provides you with carrier tracking as well as notification options for pick-up and delivery. (In the case that you need to submit tracking information for a dispute, take screenshots as the card issuers will not accept links)
Handling suspicious payments
If you are sure a payment is a fraud then refund right away. You save yourself a dispute fee and possibly loss of product by fully refunding the fraudulent payment.
Delay shipping orders
When shipping, consider delaying sending out the shipment for at least 24-48. This may give a cardholder the chance to spot and report fraud. Of course, not all cardholders check their accounts daily and the fraudulent charge may not have been posted to their account. However, this practice may help to reduce the likelihood of lost inventory.
Check the shipping/billing addresses
It is always safest to ship to addresses that have passed postal code and street address checks.
Ensure that you have a verifiable billing address and check carefully when a shipping address is different from the billing address.
Look out for indicators that could indicate suspicious activity:
- The order is for your most expensive products or the order is much larger than normal
- Changes were made to the shipping address after the order was placed
- The order includes products with a high resale value
- The billing and shipping address are in different countries.
Taking time to closely review the order and shipping address information can help you decide if there is a risk that needs to be investigated.
Received a chargeback? Learn best practices on how to respond to a dispute. Click here