As a small business owner, you may have experienced an instance where a customer disputes a charge on their credit card after a purchase, despite the purchase being legitimate. This occurrence is known as a chargeback and can result in a financial loss for your business if it is not disputed properly. Luckily, there are various steps you can take to contest a chargeback and prevent them in the future. The NFIB Small Business Legal Center’s new Credit Card Chargeback Guide will help you dispute chargebacks and, hopefully, prevent them.
The guide outlines the process of chargeback representment (the action of fighting a chargeback), alternative options like arbitration if you lose your representment case, and proactive measures you can take to prevent or reduce the number of chargebacks you receive in the future.
The guide starts by summarizing the reasons why a chargeback may occur in the first place, and how chargebacks affect your business financially. The guide offers tips for navigating a representment case including what evidence you should compile and how to draft a rebuttal letter.
Unfortunately, often merchants will not win a representment case. The guide walks through the appeals process, including arbitration, which works like an informal court proceeding.
The most important takeaway is that the best way to fight a chargeback is to prevent it in the first place. NFIB’s Credit Card Chargeback Guide provides simple steps to avoid chargeback claims. These include ensuring that your merchant name is clear on charge receipts, posting a clear return policy, keeping thorough records, and more.
We encourage all small business owners to read the NFIB Small Legal Center’s Credit Card Chargeback Guide to fight and prevent chargebacks.
For any additional questions on credit card chargebacks, you can reach out to [email protected]
This blog post is not intended to provide legal advice. For any questions related to your specific situation, you may need to check with your attorney.
