While subscription billing can be highly lucrative, subscription service chargebacks are rampant. On average, subscription services deal with five to ten times more chargebacks than any other industry.
Our chargeback prevention system can halt your chargeback problem, allowing you to reach ultimate profitability.
With over two decades of payment processing experience in subscription billing, we understand why chargebacks occur, how to prevent chargebacks, and the benefits you gain instantly when working with us.
On this page, we cover the following:
- Preventing recurring billing chargebacks
- Recovering subscription chargebacks
- Automating subscription Chargeback alerts with CB-ALERT
- Discovering why subscription chargebacks occur.
Hand Over Your Subscription Chargeback Management To Corepay
Running a company that relies on subscription billing can be challenging. On top of the unwanted fees and risk of account closure, chargebacks are a significant timesuck that can leave business owners to spend all of their time fighting chargebacks rather than growing their business.
If you’re tired of dealing with chargebacks or had your account frozen/terminated, look at what sets CB-ALERT apart from other chargeback prevention companies.
- Ethoca and Verifi alerts
- 24/7 customer service
- Transparent pricing
- RDR
- Visa compelling evidence 3.0
- Gateway/CRM agnostic approach
On top of this, we are partnered with a top-notch high-risk payment processor, Corepay.
Ready to start saving money spent on dating chargebacks? Fill out the application below to get started.
How To Get Started With CB-ALERT
We shrink the application process to as little time as possible so that we can get you processing in no time. You will need the following to provide the following so that we can get you approved:
- 3-6 months processing history of statements
- Voided check
- Principal’s driver’s license
- Proof of operating address
- Company EIN document
- Business plan – optional
- Chargeback ratio
- A functional and compliant website with login credentials
What Is A Subscription Billing Chargeback?
A subscription-based chargeback occurs when a customer refutes a charge with their bank rather than the merchant. These chargebacks occur more than any other due to shady trial offers, forgetful customers, and friendly fraudsters.
Example: A customer signs up for a Netflix account free trial. When the trial expires, and they see that Netflix has billed them, they call their bank instead of dealing with Netflix’s customer service.
If Netflix cannot produce substantial evidence that shows you knowingly made the purchase, this will result in a chargeback.
Preventing Recurring Billing Chargebacks
While recurring billing chargebacks are costly, the good news is that there are several things you can implement quickly to eliminate the majority of disputes.
At CB-ALERT, we take an approach in which we analyze your business and look at the industry your business exists before implementing a plan. This is because we want to understand why the chargebacks are occurring in the first place.
Here’s how we recommend significantly reducing your chargebacks in subscription billing.
- Fraud Prevention Tool Implementation: Implementing tools such as 3DS2 authentication, Order Insight, RDR, and Ethoca/Verifi alerts.
- Use a merchant descriptor: An accurate merchant descriptor makes your company easier to recognize. Be sure your descriptor name matches your online storefront name.
- Partner With CB-ALERT: By partnering with us, you can stamp out fraudsters before a chargeback occurs.
- Clearly communicate transaction details: Make sure your customers understand exactly what they purchase, including the price and associated fees.
- Refunds: In almost every case, a refund will cost you less than a chargeback. Refunds also give you a better chance of bringing the customer back.
- 24/7 Customer Service: Customer service is one of the essential things in fighting chargebacks. Good customer service can provide a refund or solve a problem before the customer disputes it with their bank.
- Use clear and concise billing descriptors: Make sure the descriptor on your customer’s credit card statement is clear and easy to understand, making them less likely to initiate a chargeback due to confusion.
- Keep accurate records: Maintain detailed records of all transactions, including customer contact information, order details, and any communication with the customer. This can be helpful in the event of a chargeback dispute.
- Monitor And Fix Chargebacks: Use chargeback alert systems to address disputes promptly.
- Scrutinize Irregular Orders: If you notice an order come in from another country that you typically don’t see or if the amount is far more significant than usual, look into it to ensure accuracy.
Recovering Subscription Chargebacks
We assist you in recovering chargebacks through representation. While this can sometimes be an uphill battle, if we can compile sufficient evidence in your favor, you can reverse the chargeback.
Here is how we handle the the main card brands:
Visa
- Present Visa compelling evidence that the customer did not cancel their subscription before filing the dispute.
- Display documentation that shows the customer never informed you or the acquiring bank before filing the dispute.
- Your compelling evidence shows that you offered the service, and the customer used the service after the cancelation date.
- You clearly stated your payment terms and conditions, and the customer agreed.
Mastercard
- Ensure the customer did not have a recurring payment model but an installment billing transaction.
- Prove the customer needed to meet the billing cancelation terms they agreed to during the onboarding.
- Show the customer agreed to subscription terms and conditions at the onboarding time.
- Show proof that the customer used the services after the subscription end date.
By documenting a checklist like this, you can put yourself in the position to win a lot of chargeback disputes.
Keep in mind it is tough to have the chargeback overturned, and we only recommend going this route if you’re positive that you can build a solid case.
Why Do Subscription Chargebacks Occur?
Nearly two decades of payment processing experience has shown us the following reasons for chargebacks in this space:
- Friendly Fraud: Fraudsters who forgot that they had a trial and claimed they were duped.
- Criminal Fraud: Fraudsters who are deliberately trying to use your services without paying for them.
- Affiliate Fraud: Affiliate marketers do not always market quality services. Customers can charge it back if they feel an affiliate marketer duped them.
- Poor Customer Service: Poor customer service goes hand in hand with chargebacks. If a customer contacted you about a refund and you didn’t respond, this is on your business and customer service.
CB-ALERT Knows Subscription Billing Better Than Anyone
We are confident that we can immediately add value to your business by throttling your chargebacks and setting you up for success.
By analyzing chargeback data and implementing chargeback alerts, we can significantly reduce your subscription billing charges.