Best Practices for Chargeback Representment

Chargebacks shouldn’t be a make-or-break dilemma for merchants. Understanding the salient facts of how to fight chargeback fraud, merchants can successfully navigate the representment process.
Many merchants believe that it’s impossible to win a chargeback representment, but with some good advice and then acting on strategic decisions, you can be successful. Everyone involved in the chargeback dispute—merchant, issuer, acquirer, the credit card company, and the cardholder—want the dispute resolved as quickly as possible.
It’s a good idea to review the guidelines provided by the major credit card companies, including  Visa, MasterCard, and American Express, to learn how these companies encourage you toward the best way to fight chargebacks.
Chargeback Representment Challenges
Merchants typically face three key challenges when deciding how to fight a chargeback and win. For savvy merchants who put together a thorough chargeback representment defense, the following three items would no longer be a concern:

  • Fighting chargebacks in-house. This is expensive and time-consuming, draining internal resources.
  • Cost of doing business. Chargebacks are not a cost of doing business. Merchants can successfully fight chargebacks and win.
  • Chargeback representment process. The chargeback representment process is not simple. To win a chargeback dispute, the merchant must adhere to a specific process.

Many merchants believe that they’re alone in the fight to win a chargeback. The good news is that the Verifi team of experts is here and ready to help you come out on the winning side of chargeback disputes. With our advice and industry-leading solutions, such as our Chargeback Revenue Recovery Service, we can eliminate the three challenges that hamper so many merchants.
How to Fight Chargebacks
Our goal is for merchants to have the knowledge they need to successfully fight and win chargebacks. The following details the chargeback representment process, breaking down the fundamental steps so that merchants can understand what it takes to win a chargeback dispute.

  1. The cardholder contacts their credit card-issuing bank to dispute a charge. Remember that acts of friendly fraud are very common and it pays to have solutions in place that provide notifications for high-risk customers and purchases.
  2. The issuing bank reviews the chargeback claim and typically issues a provisional refund to the customer. The merchant is now informed of the chargeback and is charged for the chargeback refund along with any associated fees, fines, or penalties (review the documentation from the credit card company).
  3. A chargeback reason code is assigned to the chargeback. Knowing the chargeback reason code is vital in preparing a successful chargeback representment case. Each credit card company has a different list of reason codes, terms, and evidence requirements.
  4. The merchant must decide to dispute or accept the chargeback. To dispute a chargeback, the merchant must follow the requirements as stipulated in the chargeback reason code.
  5. The merchant has a limited amount of time to prepare the documentation required to dispute the chargeback. Along with a chargeback rebuttal letter, the merchant may have to provide sales receipts, proof of delivery, return/refund policy information, email communication with the customer, tracking numbers, and other evidence that supports the case. Typically, the merchant has only five to ten days to compile this evidence.
  6. The merchant submits the evidence to their acquiring bank. The acquiring bank forwards this to the issuing bank.
  7. The issuing bank reviews the chargeback representment case and evidence and then rules in favor of the merchant or the cardholder. If the issuer decides in favor of the merchant, the cardholder may decide to file a pre-arbitration chargeback for the same claim. In this case, the chargeback dispute process begins again for the merchant.

During this process, there is no opportunity for the merchant to communicate with the cardholder. Having a solution in place that supports merchant and cardholder communication, often prevents the chargeback from being filed and allows the merchant to easily clear up any misunderstandings over the product or service.
You Can Win Chargeback Disputes
While the chargeback representment process may appear daunting, it’s important to remember that no merchant is alone in this fight. Savvy merchants know that with a few solutions in place that open the lines of communication with cardholders and act as evidence repositories, the challenges of chargeback representment need not be a stifling matter.
Winning a chargeback dispute comes down to preparation. With the expert assistance from Verifi, we can make this simple and hassle-free. Know that we are on your side and will be with you throughout the chargeback process, making sure you are successful.