Category Archives for "Chargebacks"

Don’t Let Chargebacks Stress You Out — Here’s How

As a subscription business owner, chargebacks are an unavoidable part of your day-to-day operations. They cost millions in reversed charges and fees every year, not to mention time and effort wasted. That’s why it’s critical to handle them effectively. What are chargebacks? The dispute process was created to protect consumers from unauthorized transactions. (Think: stolen credit card). A chargeback occurs when a cardholder disputes a credit card transaction with their bank. The sale is revoked, and the merchant loses the sale amount plus fees. Truth is, only 30% of chargebacks involve criminal fraud. Most losses come from friendly fraud, or chargeback, first party, or return fraud. In friendly fraud, the cardholder authorizes the purchase, but disputes it later. Credit card […]

Are You Affected by Mastercard’s New Free Trial Rules?

Last month, Mastercard made an announcement that left many subscription business owners wondering if their business would be affected — or to what extent. They later updated the announcement to clarify some of the rules, specifically around digital products, but in case you missed that or still aren’t sure whether it would affect your business, read on to find out what’s what. The details of the new requirements: Mastercard rolled out new consumer protections that apply to subscription businesses with free trials for physical products. In other words, if your subscription business only delivers digital products, these protections don’t apply to you. That said, it’s still worth paying attention to them and what they could mean for the future of the industry. Mastercard’s […]

How Much Are Chargebacks Costing You?

When a customer successfully disputes a charge you’ve made against their credit or debit card, the card issuer will rescind the sale from you – and adds feed on top of it. This process is called a chargeback, and it costs businesses a fortune every year. Short of physically swiping every subscriber’s card, every month, it can be very difficult to prove that a charge is legitimate. That puts the word of your credit card issuer’s customer against yours, and the customer usually wins. It’s not just the money that’s at stake, either. In a higher risk business, it’s already hard enough to get new merchant accounts with reasonable rates and terms. Accrue too many chargebacks, and you can find yourself […]