Around the world, retailers faced a dire choice during the pandemic: to adapt or face the prospect of losing their business. The Covid-19 pandemic forced businesses to rethink their sales strategies, adjust their policies to accommodate homebound consumers, and focus on other channels like eCommerce.
Recalibrating for eCommerce, although a step in the right direction, came with its own drawbacks, one of which is “friendly fraud”, or chargebacks as they are popularly called. Initially introduced as a method of consumer protection, chargebacks refer to customers asking their credit card company to reverse a charge on their card. Chargeback requests can have legitimate reasons behind them, such as order fulfilment issues or merchant errors. Some, however, can be maliciously or fraudulently submitted for the purpose of keeping both the products and the funds.
A chargeback report from 2021 shows that merchants continue to experience uncertainty in this area, supported by 25% more chargeback activity attributed to COVID-19. The reality is that there is no foolproof way to prevent chargebacks, but this doesn’t mean retailers cannot minimise their occurrence.
And this is where chargeback alerts services come into play. The best known ones are Verifi, provided by Visa and Ethoca, provided by Mastercard. We’ve covered the basics of both products in a previous article, but read on for a deeper understanding of the benefits of using these services.