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Chargebacks are happening more and more often

Jan 27, 2022

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Trade is now conducted mainly on the Internet and, consequently, payment for goods is also made online. And more and more often, merchants face the unfair use of chargebacks. Let's talk about this and how Ethoca will help you.

What is a chargeback?


Although it is a safety instrument for clients, chargebacks are unpleasant and sometimes dangerous for merchants because they cause a loss for the online store or other online businesses. The store not only loses the money received for the product or service but also pays a fine of 20-25 EUR in Europe or 23-28 USD in the USA for each chargeback. In the worst case, the online store may not only be left without money but also the goods already sent to the buyer. And if a certain number of chargebacks is reached, the online store cannot accept bank cards for payment at all.

So how do you protect yourself from a chargeback?


First of all, the hard truth: 100% protection against chargeback cannot exist in principle, but Ethoca has come close to this level of protection. That's why more and more merchants are joining the network by Ethoca company.

And this is for a good reason, as Ethoca works simply and integrates with your store. The network is based on the exchange of registered merchant account information with the database, where each owner of such a merchant account can get information about his client.

In addition, authorization in the Ethoca network is also possible through a Maxpay account, which makes it easier to connect merchants to the network. But no matter if you have a https://maxpay.com/ account or not, you will have no problem joining the Ethoca protection system.

The primary advantage that you get is that you are protected from, in particular, fraudulent payments, and you save your finances and reputation.

And we can't avoid mentioning the chargebacks types. By and large, all chargebacks can be divided into two types:

  1. A chargeback resulting from the buyer's dissatisfaction with the seller's actions.

  2. Chargeback caused by fraud by the buyer. For example, the buyer paid with someone else's card or used their card, but after receiving the goods/services, they claimed that the payment was not initiated by them. In such a case, Ethoca will help you because you will be notified of confirmed card fraud. In this case, a merchant will be able to quickly issue a refund and avoid a chargeback.