02/08/2024

State of Chargebacks and Three Ways to Prevent Them

The way chargebacks affect businesses is changing

Unfortunately, online retailers that accept credit cards from customers and vendors also deal with chargebacks. Chargebacks are payment disputes filed by customers because of real or alleged fraud.

Dealing with these disputes have always been a costly challenge to overcome for e-commerce merchants, but the way chargebacks affect businesses is changing. Not only have chargebacks become increasingly expensive, but they have also become harder to detect with friendly fraud back to pandemic levels.

Chargeback Relief for eCommerce Merchants

Despite the havoc that chargebacks can cause, there are some promising developments on the horizon that may benefit merchants as well. American Express is changing its CID mismatch policy in April 2024. Currently, one hard-to-dispute reason for chargebacks is a mismatch between a payment card's CID (or CVV) number and the number entered by the customer. Often, mismatches will result in a decline because if the order is approved, the business is liable if the customer later files a chargeback.

Please select this link to read the complete blog post from OSAP member i3 Commerce Technology.