posted on November 27, 2000 11:32:37 AM
This is an interesting link regarding credit card charge backs. This may effect how you use your Paypal account.
posted on November 27, 2000 02:59:49 PM
reamond: I think it'll be an eye-opener for some here, but myself, I've known the information in this article for years. When I had a merchant account I used it for in-person flea market sales, and when I took mail order (non-customer-present transactions) the rules, as the article states, are a lot more stringent. Luckily, I have had very few problems with fraud.
I guess what I want to point out is that chargebacks are a fact of life in the real world of being a merchant. It used to drive me nuts when people would break something themselves and then charge it back (not my fault but I had to eat the loss anyway). They blamed it on shoddy merchandise (news flash: vintage clothing is delicate!!) or "I changed my mind", etc. While the latter kind of behavior is costly and annoying, it's endemic and probably impossible to eradicate without simply stopping accepting cards altogether. I find it highly objectionable ethically, yet different from actual, actively fraudulent charges (claiming they didn't get the package, etc.)
Regarding he first kinds of chargebacks, I believe are impossible to avoid since they are usually nutso people who return everything for any reason under the sun regardless of your return policy. Those folks, I think one just has to live with if one wants to take credit cards. They operate in the gray area of the credit card rules. These rules are set up for the buyer's protection and all in all are not a bad thing, although they can be abused. (Hey, I want to be protected when I use my card, and I don't want a potential crook to be given the benefit of the doubt if he's ripped me off!) Stringent is OK, across the board discounting of the merchant's side of the story is not. And the second type is the type I believe is exploiting this and the merchant should be actively protected against, and that is what I would like to see happen. The article correctly points out that the merchant takes all the risk. As a credit card taking merchant I feel I should indeed take some risk but not all of the risk, and there should be a better review of fraud and chargeback claims. But basically the merchant is always gonna have to eat some chargebacks. I have a friend, she's the manager of a Macy's department store and she said that in certain departments such as cosmetics, the return/chargeback rate is 33%!!! Basically their hands are tied. I don't think 33% is good, but some chargebacking is inevitable....mine has been less than 1% and for that I'm grateful, but I know percentages don't mean much when you're up against some wacko who returns everything.
posted on November 27, 2000 03:24:30 PM
brighid868, I agree with what you have said and you stated it very well.
One quote from the article is "The problem is that the card issuers are going overboard in creating and almost encouraging a tendency to take advantage of the merchant in explaining how (shoppers) might utilize some of these chargeback privileges."
Also interesting is the 120 day limit. I received a chargeback in Aug. for a sale that was six months prior. Maybe I should take this up with Visa once again. Or maybe there is a longer limit in Canada?
