Merchants have no chargeback agreements in attempts to discourage customers from filing chargebacks. 

It can seem like a good idea to have customers agree to a no chargebacks clause. However, the effort can be ineffective. Credit card providers give customers the right to file disputes and chargebacks regardless of a merchant’s terms of service. 

Merchants are better off covering their bases in preventing chargebacks rather than use a no chargeback agreement. 

What Does a No Chargeback Agreement Look Like? 

No chargeback agreements are a part of terms of service. They may state that customers cannot request chargebacks under certain circumstances.  

This can mean that a transaction in itself is an agreement that customers won’t request a chargeback. This is much like saying that all sales are final. 

However, customers can request chargebacks regardless of these terms. Merchants cannot stop customers from filing disputes with their credit card providers. 

Here are a few common reasons why customers would request chargebacks: 

• Fraud: An unauthorized payment by a fraudster can prompt cardholders to file disputes. 

• Merchant Error: Technical and other errors on the business’s side can lead to disputes. These can be double charges, incorrect or delayed delivery, or wrong merchandise. 

• Unsatisfactory Customer Experience: Slow customer service can lead to disputes and chargebacks. 

When businesses live up to their promises, there is a lower chance of customers filing disputes against them. Situations where merchants are not at fault, such as in fraud, still give businesses the power to prevent chargebacks through good customer service. 

How to Prevent Chargebacks without Chargeback Agreements

Clear Communication 

Your terms of service and return policies can make a difference in your chargeback rate. Customers look to these policies prior to purchasing so they have an understanding of what to expect in the case of an unsatisfactory experience. 

Setting clear terms of service can prevent unnecessary disputes and chargebacks. They should be simple and easy-to-understand, as well as easy to find. You can place your terms of service on checkout pages, in confirmation emails, and even have customers electronically sign them. 

Customer Service 

Clear communication also includes customer service. Refining your customer service can decrease your chargeback ratio. Initial misunderstandings between your business and customers can be ironed out through timely customer service. 

There are various aspects of customer service that you can streamline to prevent chargebacks. Some of these include using the right billing descriptors and methods of communication. 

Fraud Prevention 

Chargebacks caused by fraud are the most frustrating. You can do everything you can to stop chargebacks, but fraud can hit even the most prepared businesses. 

One of Revitpay’s most used tools is our chargeback notifications feature. These alerts will tell you when a dispute has been filed against you. This gives you time to resolve the situation with the customer before credit card companies escalate the issue. Chargeback notifications can show you where fraud may be infiltrating your business. 

Additionally, tools such as 3D secure and other security measures deter fraudulent transactions. These protect you and your customers and further decrease your chargeback rate. 

Look to Improve 

No business has the perfect system to combat disputes and chargebacks. Merchants should continuously evaluate their chargeback reduction measures and fix any gaps that appear. 

RevitPay’s experience with high risk merchants gives us the knowledge that you need to succeed as a high risk eCommerce business. Contact us today to find out more about how we can help your business succeed.