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  1. #1

    any time limit for chargebacks !

    Hello,

    If a buyers wants to chargeback after making a purchase using his/her creditcard, is there any time lmit within which he/she has to apply for chargeback, if they want to ?? after which no chargebacks can be entertained set my payment processors ??

    Thanks

  2. #2
    Join Date
    Aug 2003
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    Chesapeake, VA
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    Yes, generally this limit is around 6 months. There are a few situations when this is not always 100% the case but 6 months is a general rule of thumb.

    Merchants -do- have the ability to provide a chargeback rebuttal.

    Your chances of successfully winning are predicated largely on the individual situation, the demeanor of the cardholder and the stated reason code behind the chargeback.
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  3. #3
    Thanks cdgcommerce !

    What if the service pruchased by the buyer is valid for less than 6 months ?? does 6 months mean that even after the service being delivered, the buyers still gets to apply for chargeback, if he wants to ?

    Cheers

  4. #4
    Join Date
    Dec 2003
    Location
    Canada
    Posts
    791
    From what I understand, it depends on the credit card company, I've seen cases when the person issues a charge back over 8 months later. But I guess these could be special circumstances. And I do belive the buyer can still apply for that chargeback. The only way to get him is to sue him and make sure you have proof that he bought whatever it was he bought.
    Michael MacKinnon

  5. #5
    Join Date
    May 2003
    Posts
    1,655
    Usually 6 months is the limite. Most banks with customers using Check Cards are 3-6 months. We have had lots of customers try to buy 6 months of pre-paid hosting then do a chargeback half way through the 5th month. Providing logs and other information about the customer using the account though prevented them from going through.

  6. #6
    Join Date
    Aug 2003
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    There are a few times when it can be longer. I don't have the regs in front of me but if memory serves... it can be charged back up to six months after the stated time of delivery. (I believe it also depends whether its a Visa or MasterCard as the rules do differ slightly between them)

    This was one of the big reasons that travel-oriented merchant accounts are now one of the big "untouchables" for most merchant processors.

    There were a few major scams out of Florida and a few other places where travel fraudsters sold those "too good to be true" cruise deals and so forth, booked far in advance, via telemarketing.

    They would sign up and collect millions of dollars in travel bookings and then ... surprisingly ... the cruise/travel plan never came to fruition.

    I think in those cases the time was actually longer than six months but banks lost millions on it and that is one of the reasons why travel accounts are so hard to approve these days.

    One of the positive things that I've seen done in the last couple years are a few issuing banks that now require a customer to change their credit card if they chargeback more than a certain amount in a certain time period.

    I think that is a great way to try to limit abuse by cardholders who just try to use the system to their advantage to get free service and prey upon merchants who are just doing their job.
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  7. #7
    Thanks for the information.

    This sure looks quite dangerous for merchants, if a customer wants to go aroung fooling...like buy the services and then do a chargeback even after using those services.

    Like, do we need to pick our customers ??

    Thanks again
    Cheers

  8. #8
    Join Date
    Mar 2002
    Location
    Horsham, Victoria, Aust
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    210
    After a $5500 AUD chargeback slammed on me 18 months ago after some nice dodgy singaporian ordered a laptop from me my bank nicely informed me of a 120 day policy on day number 119

    I think that while the rullings are set by the CC companies they do change state to state and country to country.
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  9. #9
    Join Date
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    Yep... from one standpoint, Purplecow, you -do- need to "pick your customers" wisely -especially- with respect to large ticket transactions.

    The unfortunate part about it is that a lot of small businesses are preyed upon by fraudsters. Often times, these fraudsters will place large orders and then are in a huge hurry to get it.

    They will often to be happy to pay out the a** for expedited ship. (after all, why do they care? It's not their THEIR money in the 1st place!)

    Here are just a few warning signs / red flags to watch for:

    1. Customer places large ticket size order but can't be contacted easily or the address and shipping info don't match up at all (you'll get the full range of excuses here... "oh I'm on vacation in such-and-such" "I'm here helping out my (relative)" "I'm here for a (insert event)")

    2. Customer places large ticket order and is in a huge rush and is willing to pay just about any amount for expedited shipping ("plz just get it to me fast, I need it urgent")

    3. Customer orders multiple large ticket items of the same type
    (why in the heck does anyone -really- need 5 large screen TV's?)

    4. Customer orders but doesn't ask a lot of the typical pre-sales questions that you have come to expect.

    5. Watch out for customers using those tele-type phone services for the deaf... (i.e. person does a Web chat connection, and an operator in the U.S. calls the designated # and talks on their behalf)

    These services are truly wonderful for those people who are handicapped but now a lot of fraudsters are using them to try to prey upon people's sympathy and look sincere when they try to confirm identity.

    Remember, fraudsters are con artists. So they will try to play every card they know - they will get irate and act upset if things are delayed, they will be impatient and threaten to go elsewhere... but remember, its better to lose 1 out of 50 legit customers than to take big hits on fraud.

    Also, I'm not meaning to suggest that people need to be paranoid but just remember to check out your orders and if something doesn't "make sense" on any level, apply your best business judgement to make sure that everything is on the up-and-up.
    CDGcommerce.com - Trusted Merchant Account Solutions since 1998
    Many thousands of successful, growing businesses benefit from our expertise every day. You can, too!
    We help merchants to eliminate gateway costs, reduce & mitigate fraud and achieve streamlined PCI compliance.
    Learn more today at http://www.cdgcommerce.com - we look forward to helping your business grow!

  10. #10
    chargebacks on credit card is usually good for 30 days

  11. #11
    Join Date
    Aug 2003
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    Chesapeake, VA
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    The liability window is a lot longer than just 30 days, though, unless the card issuer you are referring to has a much more restrictive policy than most.
    CDGcommerce.com - Trusted Merchant Account Solutions since 1998
    Many thousands of successful, growing businesses benefit from our expertise every day. You can, too!
    We help merchants to eliminate gateway costs, reduce & mitigate fraud and achieve streamlined PCI compliance.
    Learn more today at http://www.cdgcommerce.com - we look forward to helping your business grow!

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