How to properly issue a chargeback: expert advice

[CUK77]

What will you do if the store deducted the purchase amount from the card twice or did not deliver the prepaid item?

How to properly issue a chargeback.

How to return funds that were debited from the card by mistake or fell into the hands of fraudsters? The PaySpace Magazine editors have prepared a material on how to properly issue a chargeback and get money back to the card.

Chargeback on a bank card (with the anl. Chargeback - chargeback) is a procedure for refunding funds to the buyer's card if the product or service was not provided, or does not meet the expectations of the consumer. To return the funds, the buyer must prove that the seller has partially or completely failed to fulfill his obligations.

When can you file a financial claim?​

• You have not received the goods
• You have received an item that does not match the description
• The product or service was provided only partially
• You tried to return an item, but the store refused you
• You didn't buy anything, the scammers paid off with a compromised card
• The store wrote off the purchase price twice.

How to properly issue a chargeback​

If it was not possible to agree with the seller, you need to go to the bank that issued the card and write an application for a refund. Experts talked about how to properly issue a chargeback.

The format of the appeal (written, electronic or oral) is determined by the bank that issued the card. The task of the cardholder is to make sure that his application is accepted and registered, that is, the application number has been assigned and the contacts of the department are provided, in which you can find out up-to-date information about the status of the request.

The refund procedure is the same for all banks participating in international payment systems - the user comes to the bank and enters data in the claim form that will help make a decision on the refund.

As a rule, these data are standard for all banks: the date of the transaction, the currency of the transaction, the amount of the transaction, the name and address of the point where the unsuccessful transaction was made (if there is such data). And, if any, copies of receipts.

After you fill out an application for a chargeback, the bank will check it and, if the specified reasons comply with the rules of international payment systems, notify the payment system and the acquiring bank about the start of the chargeback procedure.

A merchant whose services the buyer was not satisfied with will receive a notification requesting a refund. If the entrepreneur does not agree with the client's complaint, he has 45 days to provide the bank with evidence that he has sent the goods of the agreed quality to the buyer. The payment system examines the documents provided by both parties. And decides if there is a reason to refund the buyer.

In what cases will the buyer not receive a refund?​

If an erroneous operation took place at a point of sale, in an online store, or at an ATM of someone else's bank, as a rule, the money is returned to the buyer in 85-89% of cases. But there are cases when the buyer may not be refunded. Let's consider the most likely ones:

• the buyer confirmed the operation with an SMS-password (3D Secure)

By confirming the transaction with a one-time password, you reduce your chances of receiving a chargeback. After all, the bank regards such a transaction as having received additional approval from the buyer.

If the operation was confirmed using 3DS technology, the chances of a refund using standard reclamation methods are practically zero.

However, the money for a purchase confirmed by SMS can be returned if the product or service was not provided in full, was damaged, did not correspond to the description, or was not delivered and it was possible to prove it.

• the buyer turned to the bank late

The bank may refuse to return funds if you asked for help late. For example, they did not check the card statement for 1-2 months and did not notice the controversial transaction. Visa chargeback is given from 75 to 120 days, and Mastercard - up to 120 days.

• the buyer did not comply with the payment security rules

If the client, by his actions or inaction, contributed to the passage of unauthorized payments (the card is stored together with the PIN-code, the client told the fraudsters the credit card details and the confirmation code from the SMS), the bank will refuse to carry out the chargeback.

• the buyer sent the money to the seller's personal card (for example, to OLX)

If the buyer transferred the money to the fraudster's card, then the bank will most likely refuse to return the funds. Especially if the user has confirmed the payment with an SMS password. The peculiarities of purchasing through resources such as OLX differ from purchases in stores in that OLX transfers funds from one individual to another individual. And this is done, as a rule, by the sender consciously.

To date, there is no regulatory mechanism that allows you to write off money from an individual (in our case, the recipient of the money) and return it to the sender. Since for this you need to have an evidentiary legal base that the recipient of the funds is a fraud.

However, in all such cases of fraud, buyers should contact the Cybercrime Department of the Ministry of Internal Affairs of Ukraine. And also try to directly contact the bank that issued the fraudster's card, with a request to assist in the return of funds. It will not be superfluous to write about what happened in social networks, indicating the fraudster's card number.

Even if, in the end, you cannot get the money back, thanks to your actions, banks will be forced to check all dubious and suspicious transfers, the police will gain experience in the fight against cybercrime, and fraudsters will have to get pretty nervous when withdrawing money from such a card.

What can you get a fine for?​

It is important not only to know how to properly issue a chargeback. But also how to avoid fines for false calls to the bank. International payment systems strictly monitor fraud indicators. And they impose fines on banks that serve stores with a high level of chargebacks. Banks, in turn, may demand compensation for losses - the amount of fines starts from $ 25 thousand. Regarding fines for buyers, they are spelled out in the cardholder's agreement with the bank. If the client fails to prove his right to the chargeback, the bank will have to compensate the bank's expenses for the consideration of the application - from $ 15 to $ 500. This must be borne in mind when contacting the bank with the intention to dispute the transaction.

As you can see, the chargeback procedure is complicated and quite lengthy. Therefore, before proceeding with a refund, you need to make sure that the problem cannot be resolved directly with the seller. Go to the bank only if the seller does not respond to your requests to return the money, send another product, or clarify the delivery time.