According to a 2021 report, chargeback cases have grown by an average of roughly 20% each year since 2014. How digital payments are affecting chargebacks? What about chargeback insurance?
Chargebacks: Chargeback Insurance
A chargeback is a credit card dispute that you deal with then a cardholder asks his or her issuing bank to reverse a charge. Specifically, customers often avoid requesting a refund and choose to initiate a dispute or a chargeback.
The U.S., which represents the second biggest online retail market, witnessed a return of about $102 billion worth of merchandise purchased online in 2020.
Based on the Chargeback Field Report by specialists in the field, there has been a 25% increase in the number of issued chargebacks by merchants. Overall, credit card chargebacks can be the result of the following common situations: shipping issues, fraud, dissatisfied customers, and recurring revenue.
If you’re interested in chargeback insurance, a reputable merchant services provider can help you protect your transactions most effectively. A true payments expert offering advanced chargeback protection and fraud mitigation services can help you avoid being hurt by chargebacks.
How Chargebacks Are Changing
The payments industry is fast evolving, thus resulting in a new reality when it comes to fraud and chargebacks. Specifically:
- Digital services such as banking apps are increasingly gaining traction. As a result, merchants get an opportunity to engage with customers right in the banking apps, which minimizes transaction confusion.
- Given QR code payments are becoming more widespread, you should have a better understanding of card-not-present (CNP) payments to reduce chargebacks. You need to work on balancing both the customer experience and your fraud and chargeback strategies when offering QR payments.
- Augmented shopping can help you cut chargebacks and refunds because AR enables customers to better visualize the products they’re purchasing and avoid ending up with unexpected purchases. As a result, customers can avoid returns or even chargebacks.
- Voice-activated shopping allows customers to make purchases more easily. On the other hand, it can also lead to a rise in the number of chargeback requests.
Customer Expectations Affecting Chargebacks
Digital payments and online purchases lead to disputes and chargebacks. Very often, customers choose these methods to request their money back. Know how you can protect your transactions.
Author Bio: Blair Thomas has been a music producer, bouncer, screenwriter and for over a decade has been the proud Co-Founder of eMerchantBroker, the highest rated high risk merchant account processor in the country that can best help you with chargeback insurance. He has climbed in the Himalayas, survived a hurricane, and lived on a gold mine in the Yukon. He currently calls Thailand his home with a lifetime collection of his favorite books.