How do you handle chargebacks and disputes in a fair and efficient way?

1 Know the rules and risks

Different PSPs have different policies and procedures for handling chargebacks and disputes. You should familiarize yourself with the terms and conditions of your PSP, as well as the rules and regulations of the card networks and payment methods you use. You should also understand the risks and liabilities associated with each payment option, and how they affect your chargeback rights and responsibilities.

2 Prevent chargebacks and disputes

The best way to handle chargebacks and disputes is to prevent them from happening in the first place. You can do this by providing clear and accurate information about your products, services, prices, and policies on your website and invoices. You should also communicate with your customers throughout the transaction process, and provide them with confirmation, tracking, and delivery details. You should also use security and fraud prevention tools, such as encryption, authentication, verification, and fraud detection, to protect your transactions from unauthorized or fraudulent activity.

3 Manage chargebacks and disputes

If you receive a chargeback or dispute notification from your PSP, you should act quickly and professionally. You should review the reason code and evidence provided by the customer or the card network, and decide whether to accept or contest the chargeback or dispute. You should also gather and submit any relevant documentation or proof that supports your case, such as receipts, contracts, correspondence, or screenshots. You should follow the deadlines and guidelines set by your PSP, and communicate with them and the customer throughout the process.

4 Resolve chargebacks and disputes

The outcome of a chargeback or dispute depends on the facts and circumstances of each case, as well as the rules and regulations of the PSP and the card network. If you accept the chargeback or dispute, you will have to refund the customer and pay any fees or penalties associated with it. If you contest the chargeback or dispute, you will have to wait for the PSP or the card network to review your evidence and make a decision. If you win, you will keep the payment and avoid any fees or penalties. If you lose, you will have to refund the customer and pay any fees or penalties.

5 Learn from chargebacks and disputes

Chargebacks and disputes can be costly and time-consuming, but they can also be valuable learning opportunities. You should analyze the causes and patterns of your chargebacks and disputes, and identify any areas of improvement or adjustment in your business practices, policies, or procedures. You should also seek feedback from your customers and your PSP, and implement any changes or recommendations that can enhance your customer satisfaction, trust, and loyalty.

6 Work with your PSP

Your PSP is your partner in handling chargebacks and disputes. You should choose a PSP that offers reliable, secure, and flexible payment solutions, as well as comprehensive and responsive support and guidance. You should also maintain a good relationship with your PSP, and comply with their requirements and expectations. By working with your PSP, you can reduce the risk and impact of chargebacks and disputes, and optimize your payment performance and experience.