What is a Chargeback?

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Meet George: an honest man trying to make an honest living selling weight loss supplements through his e-commerce website. He accepts payments through his site as well as over the telephone and has a strong relationship with his merchant account provider. He has been in business for three years and his credit card processing history is in good standing. However, George just received a telephone call from his merchant account provider that said a initiated a chargeback—but what is a chargeback?

A chargeback occurs when a consumer contacts his or her credit card issuing bank to dispute a charge on a billing statement. When George's customer requested the chargeback, his acquiring bank inflicted a chargeback fee for having to process the reverse transaction. Additionally, George will lose the funds from his original sale.

Chargeback Thresholds

Visa and MasterCard both have their own chargeback thresholds. If George's business exceeds these thresholds, then his acquiring bank may terminate his merchant account—and without a merchant account, he will not be able to process credit card payments. In order to preserve his credit card processing services, Instabill encourages George to prevent and dispute chargebacks.

How to Prevent Chargebacks

Whether you operate a storefront, MOTO, or online business, there are several ways to prevent chargebacks from occurring. The Instabill Risk Management Department helps merchants detect fraudulent transactions that may turn into chargebacks as well as provide them with the tools they need to prevent chargebacks on their own.

Reduce Your Chargebacks with Instabill

Since 2001, Instabill has been helping merchants reduce their chargeback ratio and increase their monthly sales—and we want to help you too! Submit our short sign-up form to the right and one of our merchant account specialists will contact you within one business day. Once you return your merchant account application form and supporting documents, Instabill can have you up and processing in as quickly as one week. Start reducing chargebacks from the source and work with a merchant account provider that will help you combat fraud.

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If you are ready to learn more about opening an Internet merchant account with true credit card processing experts, fill out our short form below and one of our merchant account specialists will contact you within one business day.