Disputes and Chargebacks

Disputed charges will be debited from your bank account or Pin Payments balance.

A chargeback is the return of funds or the reversal of a prior outbound transfer of funds from a consumer's credit card. Chargebacks may arise for a number of reasons including:

This guide is intended to provide an overview of the chargeback process and help you understand the risks of transacting online.

Card-Not-Present Risks

The conditions outlined by the card companies is clear in that their trading rules request that a ‘signature’ be obtained during a transaction. In the case of Card Not Present transactions, for example transactions made over the internet, the merchant carries a higher level of chargeback risk as they may be unable to provide signed evidence to show that the ‘true’ cardholder authorised or participated in the transaction.

While Pin Payments and the banks have fraud detection systems in place, these will not always be able to catch cases where stolen cards are used to purchase goods on your website. While it’s less than ideal, this is an unavoidable risk of transacting online that you need to be aware of.

Understanding the risks associated with what you sell

Certain products/services (such as online data storage) show a higher incidence of chargeback risk as they attract individuals who wish to use these services for nefarious means. It is important to understand the products and services you are offering and their respective appeal to fraudulent individuals.

While some controls can be instituted for physical goods (outlined below), the sales growth in digital products on a global scale, makes it more challenging to understand exactly who you’re selling to. While it is a disappointing reality, depending on the products/services offered and the locations into which you’re selling, you may need to incorporate a premium into your pricing to cover chargeback risk.

For more information on understanding the risks associated with what you sell, please see our blog post on the subject.

The Chargeback Process

A chargeback is initiated by the consumer’s issuing bank (the bank that supplied them their credit card) and the process is directed through Pin Payments’s acquiring bank. The notification of a chargeback may be received via the following:

Suggestions to Reduce Chargebacks

If shipping physical goods, it is appropriate to use shipping methods where a signature is required by the consumer to accept the physical goods. When shipping physical goods:

In the case of card-not-present transactions, the following suggestions may help reduce the likelihood of chargeback:

Where to view your Chargebacks to-date

You can view your Chargeback disputes at any time on the disputed charges section of your dashboard.