Web Hosting Talk : Web Hosting Main Forums : Web Hosting : Disputing Credit Card Charges

[iblive]

I am often seeing postings of people recommending to other people to request a chargeback directly from the credit card company. Yet, as business owners, we all try to avoid chargebacks as much as possible.

Now I know the suggestions are often given because the company "seems" at fault, but we usually only hear one side. It appears some people are projecting a double-standard. In no way am I on the side of the credit card companies, but as a business owner, I am just concerned about the public thinking that this is the way to solve problems. BTW, I have only experienced 1 chargeback and it was with my previous company.

Any thoughts or experiences?

[Ethical Network]

I think Chargebacks should be the bottom of the barrel last choice when no other choices are possible.

Chargebacks are a good thing in some cases, for the customer that is. They're never a good thing for the hosting company, or any company for that matter.

I just dont think that people should jump the gun so quickly and pull the trigger. I mean, try going through the proper channels first, and see where that gets you. If the proper channels dont work, then pull trigger, if you dont think you any other options.

Just remember - *Ask Questions First. Pull The Trigger Later*
Never the other way around.


*Mental Note* A Chargeback is The Gun

[iblive]

I agree G2.... Its sort of like getting married cause you know you can always get a divorce (which is a terrible way to decide). Customers can purchase whatever or do whatever knowing they can always request a chargeback.

[SLH]

Maybe as business owners we can try to change a few things. Example, in the NFL if a coach decides to challenge a call and the ref finds against them they are charged a time out.

Seems if the customer turns out to be at fault they would be charged the fee for investigating... yeah, in a perfect world!

[retri]

Originally posted by AaronV
Maybe as business owners we can try to change a few things. Example, in the NFL if a coach decides to challenge a call and the ref finds against them they are charged a time out.

Seems if the customer turns out to be at fault they would be charged the fee for investigating... yeah, in a perfect world!

Would be nice if something like that could be setup, for sure. The obvious problem is this:

Customer: Hey visa, I paid with my credit card for this and they didn't provide good service. Do a chargeback so I can get my money back.

Us: We gave everything promised on the website and then some. They just changed their mind and don't want to take the loss.

Customer: No, the hosting biz is lying.

Us: No, the customer is lying.

And so on. In a business with no real tangible goods to judge anything by, how are the credit card companies to know who to believe? Of course logs of e-mails and trouble tickets and whatnot could be kept, but then there's always the "that was faked" claim and such.

Of course maybe there's more to the chargeback situation than I know. All of mine occurred when I used paypal **shudder** to take credit cards, so I had no input on anything. One day I would just get an e-mail saying my money was being taken away.

[Ethical Network]

Originally posted by AaronV


Seems if the customer turns out to be at fault they would be charged the fee for investigating... yeah, in a perfect world!

Too bad Credit Card companies always side with the lil innocent customers. Perfect World? I think not. Even then it wouldnt happen.

[DanPhx]

Originally posted by retri
Would be nice if something like that could be setup, for sure. The obvious problem is this:

Customer: Hey visa, I paid with my credit card for this and they didn't provide good service. Do a chargeback so I can get my money back.

Us: We gave everything promised on the website and then some. They just changed their mind and don't want to take the loss.

Customer: No, the hosting biz is lying.

Us: No, the customer is lying.

Is there ever even a conversation? for every chargeback?

I thought the CC company just did the chargeback and kept "track" of A) too many chargebacks *for* a vender
or B) too many chargebacks *from* a buyer
And then the CC company would take action when either A or B occurred.

or not?

A conversation for every chargeback must cost the CC company big time in labor.

Dan

[iblive]

the chargebacks cost a lot for everyone involved

[retri]

Originally posted by DanPhx
Is there ever even a conversation? for every chargeback?

I thought the CC company just did the chargeback and kept "track" of A) too many chargebacks *for* a vender
or B) too many chargebacks *from* a buyer
And then the CC company would take action when either A or B occurred.

or not?

A conversation for every chargeback must cost the CC company big time in labor.

Dan

I honestly don't know how it normally works... I assumed that the company who received payment was given some chance to defend themselves (and the post I responded to was suggesting some sort of investigation of the chargeback, which would almost have to include talking to the hosting company). I only received chargebacks when using paypal as they have 0 checking for fraud... as long as a CC number is valid, they process it.

[2Grumpy]

Yes a chargeback should be the last resort.

The one chargeback I've had through my merchant account they sent me a letter with a form to dispute or a number to call, I called the number, told them the freaking chargeback was REFUNDED a full 10 days BEFORE the chargeback and how can they chargeback something we refunded? Chargeback reversed

[thedavid]

Originally posted by Dixiesys
Yes a chargeback should be the last resort.

The one chargeback I've had through my merchant account they sent me a letter with a form to dispute or a number to call, I called the number, told them the freaking chargeback was REFUNDED a full 10 days BEFORE the chargeback and how can they chargeback something we refunded? Chargeback reversed

Yup, that's basically what I got as well with our 1 chargeback that we just recieved. First one ever Do I get a t-shirt or something?

But the mailed forms and other information is pretty much a standard feature of merchant accounts and the like, from what I've seen. It's part of what that $25 or whatever the merchant acct provider charges you for.

For 3rd party providers, you don't get that as you're not the one being charged back, the 3rd party provider is. At least in the CC co's eyes, that is.

Chargeback's aren't *always* bad, as the merchant account holder has some recourse in proving thier claims - but it should be the very last resort for any customer - not the first thing to do.

[jcwebii]

Unfortunately, there are a lot of little factors that make chargebacks a big headache.

A) Consumers often don't take them seriously, and are too quick to charge something back before they review their accounting. A lot of consumers (and businesses) don't even keep up with accounting records.

B) Credit card companies will typically protect the card holder before the merchant. They often misinform the consumer that they will "investigate" the disputed charge, but in fact they often do NOT. They just issue a credit and the merchant gets a letter saying the money has been deducted from their account (plus chargeback fees).

C) Some consumers use chargebacks as a crutch for bad decision-making, irresponsible charging. Then the merchant gets punished.

D) If the money is appropriately owed (if the service or product was rendered) the merchant might file collections on the consumer. Then, the consumer will wonder why credit collections agencies are after them. The requestor of the chargeback doesn't think ahead.

E) For whatever absurd reason, some credit card companies/banks do not share the merchant phone number/contact info with the consumer. So when the consumer actually wants to contact the merchant to verify the charge, they can't do so without some investigating. The card companies that do print the phone number beside the merchant name often save everyone a lot of trouble. The people who call will suddenly realize what the charge is for and everyone is happy. Of course, this could be avoided if the consumer were just aware of the things they purchased.

F) A lot of consumers don't read contracts/tos/aup policies and procedures, and then when the merchant acts appropriately (according to the terms outlined there), the consumer is surprised and astounded. Some consumers think that online services with online-based terms do not hold any water. (They should take an online tos just as seriously as a physically signed one.)

There are a lot of other things, probably. But these are the main things that I could think of at the moment.

[cybexhost1]

Chargebacks are a pain for everyone involved, along with a heavy cost to everyone involved. Lucky me, I have never had to do a chargeback!

[thedavid]

Originally posted by cybexhost1
Lucky me, I have never had to do a chargeback!

I have.

Had a ton of asian porno charges on my cc at one point. Figured out what it was when I googled for the name, and came upon a 'network' of asian porno sites in some manner. Called the number just to confirm what they were. It was answered by someone at home I think (screaming kids in background). Took two sentances out of my mouth before the lady said 'no refunds'.

Charged it all back, reported theft of the CC# and got a new card.

So it is useful, important, and good to have - especially in cases like this. But as a first-line thing against a merchant that you know you've done business with - it's just scummy.

[cybexhost1]

Porno..... are you sure it wasn't you watching it?