How can I prevent card-not-present chargebacks?

A card-not-present (CNP) transaction is when a cardholder makes a purchase away from the point of sale (online, phone, etc.), and the merchant doesn’t have access to the physical card used. While a cardholder dispute could come from not recognizing the charge on his or her statement (which can be relatively easy to resolve without the issue becoming a chargeback), oftentimes, chargebacks following a CNP transaction is an indication of fraud.

During the transaction process, merchants should always ask for the three-digit security code and never accept expired cards. They should also ensure that all required fields (in the case of an online transaction) are filled in properly.

Following the order, merchants should attempt to verify the validity of the disputed charge through the use of address verification services (especially for overseas addresses), IP address logging systems and by making contact with the cardholder to confirm the purchase.*

 

*http://www.gspay.com/avoiding-chargebacks-in-cnp-transactions-for-e-commerce-merchants.php