How do you deal with chargebacks?
I don’t know about you guys, for me this is a big problem.
My solution earlier was to remove the option to directly buy from the site using card or PayPal.
Recently after someone complained here on IH, I’ve added again two text buttons leading to PayPal or card checkout pages.
In a relatively short period (2 weeks maybe) this has already resulted in one chargeback, costing me an additional $15 in chargeback processing fees.
My solution is again to remove the checkout links from the site and have customers contact me before wanting to make any similar payments (this way I get to screen).
How do you guys deal with this? Do you have this problem? And what’s your solution?
You can sign up for FraudLabs Pro to screen all orders for fraud patterns such as proxies and blacklists. It has generous free tier.
Thanks will check 👊
Have you figured out the root cause of the chargeback? Is it fraud?
Yes 10/10 times these are stolen credit cards, I am active in the SMTP space, scammers who are trying to use my service to send phishing emails and other scam or spam emails.
They are not successful in doing so, because of my extremely tight moderation, but the original owner of those stolen credit cards will do chargeback … for now I have AGAIN removed PayPal and credit card payment option from the site and only left Bitcoin payment option.
Customers have to contact me now, just to avoid these chargebacks because it costs so much :/
I was ever in the web hosting industry and that is quite common, providers use Maxmind or FraudRecord before service delivery to detect if there are fraudulent activities, if the risk score is high the order will simply get canceled & refunded.
You might follow the same pattern to avoid unnecessary loss.
I am using 2checkout, will see if they have similar features
It's not a feature on the payment gateway side, it's something you should implement on your server side.
Payment gateway should have something to detect fraud, but you cannot rely on it all the time.
I see... will see what my options are, thanks