Payment 101:
Chargeback Services

Friendly fraud is now reportedly the number one fraud attack source that merchants deal with, and eCommerce losses resulting from criminal fraud were as high as $20 billion dollars globally in 2021. Although chargebacks are a time-consuming distraction, treating them as an unavoidable business expense is a costly mistake. The good news is, it’s easy to reduce chargeback volumes and fees with the power of Payment Orchestration. 

According to The 2022 Chargeback Field Report, merchants lose an average of $3.75 for every $1 lost to chargebacks, and the average cost of a single chargeback will reach $190 in 2023.

As well as the lost revenue in sales and cost of merchandise, this cost includes additional expenses such as chargeback fees, administrative fees and the overhead costs of shipping and fulfilment. Add the cost of false declines and return fraud, and you’re looking at a significant hit to your bottom line.

So why do so many merchants write off chargeback losses as an unavoidable part of running a retail business?

Partly because the payment dispute process can be difficult to understand, partly because the average merchant only wins 21% of the chargebacks they dispute, and partly because detecting fraud is incredibly difficult.

But with a combination of Payment Orchestration and dedicated chargeback solutions, merchants can effectively manage and reduce chargebacks.

Reduce chargebacks with super-charged Payment Orchestration

Our platform, Velocity, simplifies the chargeback process, even for merchants with multiple payment processors, using an industry-leading solution that intercepts disputes and avoids chargebacks by replying in real-time with additional transaction information or refund confirmation. It also identifies and responds to illegitimate disputes with compelling evidence and can reverse chargebacks to recover revenue lost to friendly fraud, which accounts for up to 78% of chargebacks.

Perhaps most importantly, it can identify the true source of chargebacks and make informed decisions with accurate and actionable data. All this results in a reduction in chargebacks of up to 40%.

But Payment Orchestration also facilitates a lesser-known chargeback-fighting tool; alternative payment methods (APMs).

More choice, fewer chargebacks

Chargebacks occur when a customer requests the reversal of a credit card transaction. In this case, both the credit card issuer and the merchant bank review the claim, a process which could take weeks. Businesses suffer a lot in these situations as the payment gets stuck. These risks can be significantly reduced by using alternate payments from bank accounts and direct debit accounts.

Aside from offering consumers greater choice and convenience, reduced chargebacks are another advantage APMs offer over credit cards. Using a Payment Orchestration Platform like Velocity, merchants can easily adapt the checkout process to integrate new payment methods, all configured to meet your customer’s needs in every market you serve.

As Payment Orchestration experts with a dedicated chargeback solution, we arm our customers with the best defence against friendly fraud: the ability to identify and respond to illegitimate disputes, and reverse chargebacks to recover lost revenue.

From checkout to chargebacks, Payment Orchestration helps merchants take control of their payments and gives them the power of insights to make informed decisions about the payment ecosystem. If you’d like to find out how we can help you turn payments into a strategic advantage for your business, get in touch today.

Boost revenue and simplify operations with our Payment Orchestration solution

Elevate your business with our Payment Orchestration Platform. Streamline operations, access global providers, and optimise processing times. Benefit from intelligent routing, fraud prevention, and real-time analytics. Request a demo to revolutionise your payment systems.