Merchant Account Chargebacks

The ability to issue chargebacks from merchant account issuing banks is an essential function which lends confidence to the use of credit cards for consumers. The chargeback provides a last line of defense for consumers that have been victims of identity theft or unreasonable merchant account holders. But abusive customers may resort to the chargeback first, instead of going through merchants’ customer service channels, or use it as a means to commit fraud.

Clearing chargeback disputes can sometimes take months, and even if the issuing bank rules in the favor of the merchant, the fees and other costs for disputing a claim can represent intensive overhead on the merchant account. Individual merchants often keep a list of customers that have a history of abusing chargebacks in order to minimize unnecessary claims, but sharing such information between merchants is fraught with problems. To provide merchant account holders with better tools for identifying problem customers, BadCustomer.com maintains a database of consumers with a history of abusing chargebacks.

BadCustomer.com allows participating merchant account holders to query its database of consumers with known chargeback histories to inform the merchant if a customer has been flagged for abuse. The decision of whether or not to allow a given transaction is up to the merchant, but with the data provided by BadCustomer.com, that decision can be better informed. Protecting a new merchant account is particularly important, as few as two chargebacks can result in account cancellation. To avoid having a merchant account closed due to the simple misfortune of dealing with a problem customer or two, this service can be used as a means of vetting those you do business with. If you have a new merchant account, or you have a small business with a low overhead, the protection offered by BadCustomer.com may be just the thing you have been looking for.