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One of the most common pain points for high-risk businesses is elevated chargeback rates. Payment chargebacks not only cost businesses money; in high enough volumes, they can also get merchant accounts flagged, leading to higher processing fees, penalties, or even account termination. The worst part is that many of these chargebacks can be frivolous or illegitimate, with consumers getting exactly what they paid for from a product but charging back anyway. Businesses with higher chargeback rates often struggle to dispute these as they get higher in volume, costing them money, time, and potentially even their payment processor.
As a result, many high-risk businesses seek out chargeback management tools to more effectively dispute and reverse these chargebacks, lowering their chargeback rate and saving money. In this piece, we are going to cover all of the following:
- What chargeback management tools are
- Benefits of chargeback management tools
- The best way to leverage them
Let’s dive in and figure out exactly why so many high-risk businesses are looking for payment processors that offer more advanced chargeback management tools.
What are Chargeback Management Tools?
Chargeback management tools are software and/or services from a payment processor that provide a simple, standardized process for managing and disputing chargebacks. This can include anything from simple communications management with customers and banks to more advanced features like chargeback interception, which allows businesses to resolve chargebacks before they are ever officially filed.
Not all chargeback management tools are created equal, and businesses that expect to deal with a higher chargeback rate should seek out more advanced options. Below are some of the most common chargeback management tool functions, and how advanced a tool is for providing them:
Chargeback Management Tools
While basic tools will make it easier for businesses to handle chargebacks themselves by providing clear and readable dashboards and easy contact methods, advanced tools begin bringing in AI or other pre-programmed workflows that will automate some of the more mundane and repetitive chargeback management processes like initial contact, evidence gathering, and generating insights based on your chargeback metrics.
Industry-leading chargeback management tools handle the vast majority of the chargeback management process for merchants, and they will provide strategies for resolving chargebacks before they are officially filed, ensuring they don’t negatively affect your business’s reputation or standing regarding payment processors.
Benefits of Chargeback Management Tools
Since chargebacks bring with them countless risks and negative impacts, better management processes offer several benefits. We’ve always put a strong focus on chargeback management and fraud protection, and the following are the most common benefits our clients experience when working with us and our industry-leading functionality.
Benefits of Chargeback Management Tools
- Less Time Sent on Chargeback Management: Automation means less staff time spent handling chargebacks manually and faster resolutions for your business and your customers.
- Minimized Losses to Chargeback: By using an industry-leading chargeback management tool, you can ensure that you are losing as little money as possible to frivolous or fraudulent chargebacks, and CBs are serving their intended function of making customers whole when there is a problem with your product or service.
- Better Customer Satisfaction: Industry-leading features like chargeback interception allow businesses to reach out to customers after they attempt a chargeback, but before it is filed, and resolve the issue proactively. This leaves customers with a better impression of the business since the resolution went through them instead of the customer’s bank/creditor.
- No Fees or Penalties with High-Risk Processors: Since the best chargeback management tools are offered by specialist high-risk payment processors, businesses that use them usually don’t have to worry about penalties or fees for higher chargeback rates since their payment processor understands the risk and even takes some responsibility for minimizing CB rates.
- Long-Term Chargeback Deterrence: Frivolous chargebacks are often done by actors who are aware that the businesses they target are generally easier to successfully CB. By adopting stronger CB management tools and disputing fraudulent CBs consistently, businesses can ensure they aren’t seen as an easy target.
These benefits not only improve the bottom line of the businesses that leverage them but also improve customer satisfaction and prime businesses for more sustainable growth by improving confidence, security, and consistency.
The Best Way to Leverage Chargeback Management Tools
The best way to adopt new chargeback management tools is to work with a specialist high-risk payment processor that offers industry-leading functionality. High-risk processors understand that businesses in these industries have widely varied and unique risk profiles, and they will do the work to understand your business up front and provide advanced tools designed to deal with their biggest pain points, including chargeback management and fraud protection.
Not only that, but these payment processors are purpose-built to handle high-risk and/or high-volume merchants, so their clients don’t have to worry about sudden account flags, freezes, holds, or even termination if their risk profile changes as they grow. The best high-risk payment processors will work with you through a dedicated account manager to create a collaborative environment wherein issues for both your business and the processor are handled quickly and in a way that works best for both parties.
Industry-Leading Chargeback Management with Seamless Chex
Seamless Chex is an experienced high-risk payment processor that specializes in purpose-driven features like chargeback management tools. Our 99.1% approval rate and comprehensive high-risk industry list mean businesses of nearly all industries and sizes can be confident in our support. We work to truly understand your business from the outset, with upfront underwriting and individualized payment schedules designed to work for each client’s market and business cycle.
To learn more about chargeback management tools, contact us today.
