A chargeback happens when a cardholder contacts their bank and asks that a payment be reversed. Cardholders may file a chargeback for lots of reasons, but there are a few things you can do to prevent them, and to strengthen your case if you’re ever faced with one.
Let’s talk tips:
Give an itemized receipt, and keep a copy
One common reason you might lose a chargeback is that the you can’t produce a signed itemized receipt. In some cases, things like copies of texts or email interactions aren’t sufficient proof for credit card networks, so they may not help you much. One way to prevent this? Always get a signed itemized receipt, with the refund policy clearly outlined before the signature.
Include your business name on receipts
Many cardholders file a chargeback when they don’t recognize the name of the business when it shows up on their statement. To reduce the possibility of this, make sure your business name is updated and is descriptive of what you do. For example, if you’re a taxi driver, instead of using your name, make sure your business name includes “taxi.” So instead of “John Smith” your customer will see “Taxi Service - John Smith” - making them much less likely to file a chargeback.
Document as much as possible, especially for phone/internet transactions
A good rule of thumb is to keep track of lots of details of every transaction - things like what was sold (how much, and if installments which one) and the buyer’s name and contact info. This is especially important for sales when the customer is not present, such as phone/internet transactions. Writing “Internet Order” or “Phone Auth” on the signature screen can help Square fight chargebacks on your behalf. A signed contract or invoice, including an itemized breakdown, with proof that delivery took place, and that the client agreed to the final amount charged are very helpful documents when defending contract work. For more details, check out best practices for selling online.
If all of this sounds a little scary - don’t worry! If you’re facing a chargeback, we’ll ask you for some basic information, and then we take it from there. Learn more about what it's like to face a chargeback.
Is there anything specific you do to prevent chargebacks? What tips can you share?
I have been practicing Dentistry for 30 years and have had only 5 chargebackrequests from patients.
All were using American Express. All were from women ages 42 to 49. All were people that had self esteem issues. All chargeback were eventually denied after 7 to 10 DAYS.
Now we come to the "Square" platform, protocol,methodology, position in entering the merchant services arena.
I performed some cosmetic dentistry on May16, 2017 for a patient, she paid with American Express. Then she returns 2 months later and has 4 more esthetic crowns fabricated and cemented with permanent cement.
We took photographs every step of the way and she seemed happy until the very last crown was cemented. Then she became a living viper bit*h nightmare. Her teeth looked fantastic but she found silly things to complain about. Unbelievable, like I'm God and I'm supposed to make her look 20 years younger.
She filed for 2 chargeback on December first, a total of $5,200.00 So of course my account is debited and the whole darn jury, judge, and executioner is fu*king American Express. They say the judgement day is in a a few months. Basically I'm screwed, somehow I feel that Square lacks the financial punch that my previous merchant service people displayed. For example I had a similar situation when I was using BB and T bank.
I walked in to my bankers office , gave him the details and presto, he had the chargeback reversed in one day , that's called clout. Big big banks have clout, I have Square, Square peg in a round American Express ho.
Square just got rid of chargeback protection on 4/11/19. Seems like a bad move for merchants. Let’s see what Square will actually assist with in the chargeback process going forward. This chargeback protection was one of the unique features offered by SQ.
Hi @LDBH - I just posted this article describing a bit more about Chargeback Protection's retirement. Our team will continue to assist in the chargeback process going forward and we're reinvesting in the program to streghthen aspects that our sellers found most valuable. Let me know if you have any questions by responding here or leaving a comment on that article I linked.
It may be time to keeps our ears open for newer platforms that provide a little cushion for small businesses in regards to chargeback protection.
If anything square chargeback protection should have some stipulations as in as long as you can provide x, y, & z then you are protected.
You have to remember that Square does not ultimately decide how your dispute is settled: that rests with the customer's credit card company. Square acts as an intermediate, advocating as best they can on your behalf.
Square's recent change to their chargeback protection program did not eliminate the program, just the financial coverage.
The charge back protection was one of the reasons I chose square. As a small businesz this feature was important to me. Think I will do some searching to see what others are offering. I even recommend square to others because of this feature.