Payments Blog

Chargebacks, False Positives and Other Holiday Issues

Posted by CardinalCommerce
Aug 22, 2017 8:30:00 AM

There’s a lot going on around the holidays, especially for merchants. There’s often a certain revenue benchmark that merchants are trying to hit before the season ends and, on top of that, they need to ensure that all their consumers are satisfied with their products and, perhaps more importantly, their service, both online and in-store.

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Topics: Fraud, chargebacks, false postives, holiday

Chargeback Day and the Lessons Learned from the 2016 Holiday Season

Posted by CardinalCommerce
Jan 31, 2017 8:30:00 AM

Once again, the holiday season has come and gone, seemingly in an instant. During this two-month period, consumers continued to migrate towards digital channels, and away from brick-and-mortar stores, to do their holiday shopping. Consumers transacted via mobile devices at a remarkable rate, as evidenced by the surge in activity on Black Friday. November 25th, or Black Friday, became the first day in retail history to account for over one billion dollars in mobile revenue, totaling $1.2 billion, according to Adobe.

While the digital sector of the retail industry carried this momentum throughout the season, department stores underperformed, relative to their digital counterparts. While sales at traditional, brick-and-mortar stores still account for a vast majority of all retail purchases, the digital channel continues to gain share in the retail industry. This holiday season, brick-and-mortar sales fell 10 percent, and store traffic fell 12 percent however, average order value rose 4.8 percent, according to RetailNext. Despite the consistent, and continued, growth of the digital sector, consumers are still saving their biggest purchases for brick-and-mortar stores, even if they are spending less money at these stores over the course of the entire holiday season.

While online merchants have a lot to celebrate in the aftermath of the holiday season, they also have a glaring concern: chargebacks. Chargebacks, those transactions that are disputed by a consumer’s issuing bank, at the request of the consumer, are very prevalent for online merchants, particularly after the holiday season. Chargebacks occur so frequently after the holiday season that the second Tuesday in January has been dubbed “Chargeback Day.” If they’re not careful, online merchants can lose significant portions of their revenue to chargebacks and chargeback fees.

In addition to chargebacks, these merchants must worry about, and monitor, their conversion rates, the rate at which visitors of their website become consumers by making a purchase. Typically, merchants that create a frictionless consumer experience on their digital channels will have outstanding conversion rates, and will maintain a satisfied consumer base, which will create additional revenue. But, merchants that maintain a friction-filled consumer experience will consistently lose consumers and will see their conversation rates plummet, as these consumers will likely leave their website, and never return.

The holiday season is supposed to be the most wonderful time of the year. But if online merchants aren’t prepared, they will find coal, rather than revenue, in their stocking. Connect with Cardinal to learn more about Cardinal Consumer Authentication, how it can reduce chargebacks and how it can ultimately improve your online business. With your One Connection to Cardinal, we can drive your digital commerce.

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Topics: Fraud, CardinalCommerce, chargebacks, online shopping, mobile, CNP, conversion rates, holiday

PayPal Merchants: How to Avoid Chargebacks

Posted by CardinalCommerce
Jan 24, 2017 8:30:00 AM

PayPal is one of the most popular payment processors in the online payments industry. Since this platform is used by so many merchants, it’s inevitable that some, if not most, of these merchants will encounter chargebacks. Dealing with chargebacks is often a costly process for these merchants, but there are various ways to combat these issues, and to eliminate chargebacks before they can do serious damage.

For merchants that use PayPal to process their payments, the vast majority of transactions occur online. There is an inherent uncertainty and lack of familiarity between the merchant and the consumer in online transactions. Merchants should provide clear, succinct contact information for consumers on their website. This way, if there is a problem or a dispute, the consumer can easily contact the merchant, instead of filing a chargeback with their issuing bank.

PayPal users also have a unique resource at their disposal: The PayPal Resolution Center. If a consumer is resolute in their desire to file a chargeback, the merchant should encourage them to open a dispute in the resolution center. For both parties, this alternative provides an opportunity to work out the dispute in a peaceful and agreeable manner.

It’s important for merchants to maintain an open line of communication with their consumers, so that those consumers will feel comfortable confronting them with any potential issues. Most of the time, both sides want a quick, easy resolution to the chargeback problem. But in cases where the consumer’s card has been compromised by a criminal, talking through the problem will not work.

Merchants need to stop fraud and prevent chargebacks. By using Cardinal Consumer Authentication, merchants can limit fraud, and prevent chargebacks. Connect with us to learn more!

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Topics: Fraud, CardinalCommerce, chargebacks, CNP, PayPal

One Bad Apple Spoils the Whole Bunch: How to Prevent Chargebacks

Posted by CardinalCommerce
Jan 17, 2017 8:30:00 AM

Chargebacks, those transactions that are under dispute, can be very costly for merchants. In most cases, merchants lose the goods or services in question, and incur significant fees and penalties. Merchants that accumulate a substantial amount of chargebacks will also damage their reputation with financial institutions. To maintain a good reputation with both consumers and banks, merchants, particularly those with low transaction volumes, need to eliminate chargebacks.

Initially, chargebacks may seem to be a cost of doing business, but there are many precautions that merchants can take to ensure that they don’t suffer significant financial losses. Issuing banks also consistently monitor chargebacks, and are adept at identifying high-risk merchants. Those merchants with low transaction volumes are in danger, because one chargeback will appear more significant to the issuing bank than it would for a merchant with higher transaction volumes.

Merchants that process fewer transactions, but accrue a significant number of chargebacks will put their consumers’ future orders at risk.  After an issuing bank classifies a merchant as high-risk, it’s increasingly likely that they will see a higher rate of false positives, legitimate transactions that are declined, on their website.

In trying to eliminate chargebacks, merchants must think of their consumers. Whether it’s implementing a clear, understandable checkout process or establishing and maintaining a sterling reputation with respect to customer service, it’s important to keep the consumer happy.

One of the best ways to keep your consumers happy, and prevent chargebacks is to eliminate fraud on your website. With your One Connection to Cardinal, you can stop fraud, and more importantly, keep consumers happy and maintain a good reputation with all issuing banks. Connect with us to learn more!

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Topics: Fraud, CardinalCommerce, chargebacks, false postives, CNP

What is a Chargeback?

Posted by CardinalCommerce
Jan 10, 2017 8:30:00 AM

For merchants, chargebacks are a significant issue. Initially designed to protect consumers, chargebacks, instead, have become stress-inducing for merchants. But what, exactly, is a chargeback?

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Topics: Fraud, CardinalCommerce, chargebacks, CNP

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