If you accept card orders, then you may encounter chargebacks.
A chargebacks is when the cardholder's bank returns a payment to the cardholder.

A transaction that is not authorized by a customer is referred to as fraudulent. A fraudulent transaction can result in a chargeback, which can cause you to lose money.

Here at Flipdish, we take many precautions to help you safeguard your acceptance of credit and debit cards online, with an extensive range of fraud checks and we see very low levels of suspicious transactions versus industry norms.

However it is not possible to avoid all chargebacks. For example, some people place legitimate orders and then forget and later initiate a chargeback. Others use their ex-partner's card after a breakup. This type of fraud is impossible to detect. 

Common reasons for chargebacks include:

  • Fraud enquiries, where the cardholder denies participating in or authorising a transaction
  • Non-delivery, where the cardholder disputes the sale for reasons such as failure to receive goods or services
  • Quality, where the cardholder disputes the sale for reasons of quality e.g. food was cold on delivery
  • Customer does not recognise the transaction on the receipt or statement
  • Disgruntled customers
  • Deceitful and dishonest behavior

You can protect your business from chargebacks in several ways:

  • Train your staff to reject suspicious orders 
  • Phone the customer to check the validity of the order
  • Ask the customer to sign for delivery
  • Review high value orders (especially those that are much larger than your average order size)
  • Let your customers know the correct way to request a refund (which is to contact you directly)
  • Be vigilant about suspicious behaviors e.g. person requests you to call them on a different phone number than the one they placed the order with
  • Have CCTV footage 
  • Ask staff to be vigilant for suspicious behaviors and orders

To keep fraud low it's important for your staff to know that they can refuse suspicious orders. In these cases they can

  • Outright refuse the order
  • Refund the online payment and require the customer to pay using chip and pin or cash
  • Request that the customer show them the card used to pay online
  • Require a photograph of the customer before handing over the order

We find that fraud is generally caused by a small number of people and once they are no longer served then it makes a big difference.... and your store staff are well placed to detect and prevent fraud. These customers cost you money, so it's important your staff help with catching the culprits.

Any disputed payments will be refunded to the card holder and deducted from the store's balance, with Flipdish refunding any fees charged on that order to the store. Any chargebacks to your store will be detailed on your Flipdish account.

If you have any further questions, please don't hesitate to email us on [email protected] 

Related article: Understanding your Flipdish account

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