EMV is a trending topic, whether you are a merchant, bank, or payment processor. The EMV Chargeback liability shift pertains to card present transactions only. We have put together this eGuide to assist in educating and guiding your understanding of EMV and how it impacts you.
If you are an online retailer, you know all too well the importance of creating a checkout that is as easy as possible and in as few steps as possible. But creating an easy, frictionless checkout becomes complicated when you add in necessary security features to process payment transactions. It is very easy for an online shopper to abandon their cart, change their mind, or Google their purchase elsewhere. Now there is a process called 3D Secure Advanced that has accomplished secure checkout, without the friction of the original 3D Secure. Here is how:
Don’t let chargebacks (and the issuing bank lobbyists) derail your business
Credit card chargebacks can often be the bane of a small business owner’s existence. They require significant investments in time and labor to research and respond. Let’s face it: The card issuing banks have lobbied for years to ensure that the cardholders receive the benefit of the doubt when there is a chargeback case, not the merchant.
A little unknown fact is that the bank that issued the credit card involved in a chargeback is the decision maker between the merchant and cardholder as to who wins the chargeback case. This decision is based on the documentation received by both parties. The only point in which the cardholder receives an unbiased decision on a chargeback case is if the merchant loses the chargeback case and wants to ultimately take it to arbitration. At that stage, representatives from the card companies are involved in the decision. Unfortunately this is somewhat of a gamble, as there is a fee as high as $400 if the merchant takes the case to arbitration and LOSES. Once again, the rules are slanted in the cardholders favor.
Given that the issuing banks have stacked the deck, we suggest you take the following steps to protect your company against costly chargebacks, and guard your crucial cash flow:
Learn the Reasons Why Customers Initiate Chargebacks
Getting in the mindset of your customer is a sound strategy across many areas of business, from pricing and marketing to customer service. Chargebacks are no exception, as having an understanding of why your customers most often initiate chargebacks can illuminate a clear path to future prevention. There are myriad reasons why customers choose to begin the chargeback process, including billing errors, perceived substandard quality of the service or product, or outright fraud. Sometimes, a cardholder will reject a legitimate charge simply because they don’t recognize the transaction, preferring to let the credit card company do the leg work rather than contacting the vendor themselves. At any rate, taking proactive measures to prevent fraudulent card use is a step in the right direction.
Start with Prevention
Card Not Present: In the case of an online transaction, make sure you are collecting all of the appropriate data from the cardholder, such as the unique three- or four-digit security code and billing address. If you have more than a few chargebacks per month or the dollar values are high, it may be time to invest in fraud management tools such as IP Geolocation, Verified by Visa/ Mastercard Secure Code. You can even review suspicious transactions via Google Earth to validate that the person behind the transaction is not a fraudster. Work closely with your processing partner to devise a toolset that comes with a Return on Investment that makes sense for your business.
Card Present: Although there are fewer cases of card present chargebacks, they typically can be stopped quickly by doing a verification of the cardholder by asking for a license when it feels like a suspicious transaction or the card cannot swipe. With EMV on the horizon, and the EMV chargeback liability shift occurring in October, it may make sense to invest in the EMV capable terminal. But keep in mind, investing in an EMV terminal only protects against counterfeit card fraud. If you have never seen this type of fraud before, rarely receive a chargeback, and know your customers, then this investment may not be needed right away…
Restaurants are a perfect example of an industry where counterfeit card fraud is not an issue. The cost of upgrading to an EMV device may far exceed the threat of a chargeback. Again work closely with your processor to discuss your specific business and whether it makes sense to rush out and buy a new terminal or EMV capable device. But keep in mind, this is starting to feel like Y2K all over again… therefore, make sound not rash judgments when it comes to this investment. Best Buy in Canada waited years to invest in EMV equipment and mitigated chargebacks by reviewing driver’s license to mitigate their risk. You could easily do the same until the time is right to invest.
Read: Top 7 Reasons NOT to Adopt EMV
Follow Credit Card Company Instructions and Respond Promptly
Credit Card providers issue strict instructions for how to respond to chargebacks, and it’s important to follow these regulations as delays in the process or missing documentation can severely damage your case. It’s wise to assign one person the responsibility of checking and responding to chargebacks each day, lest you risk falling behind and missing response deadlines... Resulting in automatic disqualification of your claim.
Take a Proactive Approach to Chargebacks
Rather than sitting back and taking a reactive approach to chargebacks, Solupay is actively pursuing and implementing Fraud Management and Chargeback reduction solutions that are customized to the unique needs of each client that, again, actually have an ROI. If you are ready to have a discussion, please feel free to reach out to us directly so we can do a review of your current business processes and determine if we have tools to augment your fight and make things fair again!
In one of our "Bill Gates meets Steve Jobs" moments a few years ago, the innovators here at Solupay changed the world with "Multi-Merchant Tokenization." OK, OK... perhaps comparing us to technology legends is a stretch,and maybe this concept won't revolutionize the world like Apple and Microsoft have done, but we did coin the phrase Multi-Merchant Tokenization, and it’s really not a hard concept to understand and see why it has been successful. Plus it has proven to be an added convenience for customers of e-commerce merchants, while making life easier for the merchant while providing a better end user experience.
Let's take a closer look at Tokenization and Multi-Merchant Tokenization.
Accounts receivable is truly the lifeblood of any business that extends credit to customers. Manage it effectively, and you can grow your business strategically. Manage it wrong, and you introduce inefficiencies and increase costs that erode margins.
ACH (Automated Clearing House) payments have become popular largely because of their convenience, reliability and cost-effective solutions. ACH is a payment solution that accepts payments by moving funds from one bank account to another electronically through routing numbers. If your businessis utilizing direct deposit to pay employees, whether you know it or not, you’re already using a form of ACH and are aware of these benefits. But how can ACH payments actually increase sales for your business?
With CNP fraud on the rise since the EMV chargeback liability
Topics: Card Security
Converting leads into sales is the bottom line of business. Getting a lead to the quoting stage of the sales lifecycle can be challenging enough. Depending on the length of your sales cycle, the process to generate actual cash flow from a hot prospect turned new client can seemingly move along at a snail's pace. Here are 3 secrets to close the deals faster, converting leads and turning quotes to cash for your business:
The formula for improving cash flow is simple: collect account receivables as fast as possible, and slow down your accounts payable without jeopardizing your relationship with suppliers and partners. Knowing that most businesses, and even individual consumers, operate with the same ideology in mind means the challenge to get paid faster may seem insurmountable. Which is why an industry exists to create products that focus on helping businesses get paid faster. When cash flow slows, the likelihood of survival decreases. In fact, the lack of cash is one of the top reasons that small businesses fail.
In today's commerce climate, there are limitless opportunities for merchants to sell their goods and services. At the same time, there are limitless opportunities for thieves to exploit merchants and consumers. Credit card data breaches at major retailers have made the news wire too many times to count, and when it comes down to it, it is up to the merchant to understand the responsibility they have in protecting their client's data when accepting credit card by enforcing appropriate security measures.
Topics: Card Security