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Credit Cards and Chargebacks

by on Sep 18, 2020 in
Credit Cards and Chargebacks

People who are employed and working might have a credit card with them. A credit card is important whenever consumers currently don’t have funds available within their bank account.

It's simply borrowing money from the bank until the credit card owners can come up with the money to pay for the things they have bought with the credit card. 

But at one point, consumers may come across a transaction issue, and they have already used the credit card to pay for it. It’s not a good feeling to pay for something, and the goods aren't what the consumer expected, or they never came at all.

After calling the bank, they would suggest the credit card owners request a chargeback. “What is a credit card chargeback?”, they might ask. It’s a process that’s going to help return the money into the buyer's bank account. 

When Does a Chargeback Happen?

There are many instances that a chargeback can happen. Buyers need to know that they can request a chargeback process whenever there are issues between them and the seller. A good example would be when the item the buyer received has many issues that the seller has failed to remind them.

Instead of exchanging the item, they would request a refund. And since they used a credit card, the only way to get them back is through the chargeback process. 

Another instance where buyers can ask their credit card company for a chargeback process is when the credit card has made a transaction the owner was not aware of. It usually happens when they lose their credit card, and they can't close it at once.

When a person loses their credit card, they should contact the credit card company and have it closed at a moment’s notice. And if ever they find any unauthorized transactions, immediately requesting a chargeback is important so that the seller can react to the dispute quickly and get the money back. 

A Few Tips to Avoid Chargebacks for Sellers

Due to the sudden rise in online shopping, sellers cannot physically receive any money from their buyers. Most online shoppers will pay using their credit cards, so businesses will never know if the purchase was made from the credit card owner or not.

If it’s not the real credit card owner, sellers can expect chargebacks to happen at any moment, which can be a detriment to their business. 

A good tip of avoiding chargebacks is following the payment processing protocols. There are card-processing networks with particular protocols for handling transactions where the cardholder cannot physically present it to the seller.

The seller must strictly follow the payment processing protocols to help eliminate fraudulent transactions before they even go through. If businesses ignore these fraudulent transactions, the card network might blame them during a chargeback process. 

One other tip to help a business avoid chargebacks is verifying suspicious orders. A buyer might suddenly buy a ton of products from a seller, even though it isn’t something that should be bought in bulk. A seller should also keep an eye out for purchases made from countries outside, especially if it’s from countries where credit card fraud is rampant. 

The times are changing, and people need to be informed with chargebacks.

If clients or customers ask the seller, “what is a credit card chargeback?” they won’t have a hard time giving them basic information about the topic.

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