What is a high chargeback merchant account

Merchant Services Q&ACategory: High Risk Merchant ProcessingWhat is a high chargeback merchant account
Bankim Chandra Staff asked 7 months ago
1 Answers
Bankim Chandra Staff answered 7 months ago

There is nothing like a high chargeback merchant account. We believe that it is a marketing gimmick. Every payment processor has to follow the rules of card schemes. There is a set % of CB that a PSP will tolerate. Once the merchants account reaches the red line the PSP is bound to take risk mitigation actions. This may include freezing the account, limiting the account or terminating the account.
So what should a merchant do if the expect chargebacks are on the higher side

  1. Use chargeback alert services
  2. Sell awesome products and services so that the complaints are less and thus less chargebacks
  3. Ensure that you have a educated support team that know how to resolve issues
  4. Fix a TAT to resolve issues. Dont let issues convert into disputes and chargebacks
  5. Ensure that you collect customer satisfaction surveys and proof of product/service delivery
  6.  Use alternate payment solutions like APMs, Echeck, ACH, Sepa, Crypto etc as these generally are not on card scheme rails
  7. Elevate the engagement level with the cardholders. Develop a relationship so fine that if they have any issue they call you first if there is any issue.
  8. Study your business model and patch the loopholes that may result in elevated chargeback percentage
  9. Increase total sales and total value. This helps in dynamically reducing chargeback percentage and chargeback volume.

Hope this helps.