If you’re familiar with chargebacks, you know they’re a major concern for merchants. The impact of chargebacks is significant and multifaceted, making it essential to understand which industries are most affected in 2024.
Accurate chargeback statistics can be challenging to pinpoint. Reliable data on the state of chargebacks is often scarce, and available information can sometimes be contradictory. Despite these difficulties, examining current trends is crucial to get a clearer picture.
Evolving technology and shifting consumer buying habits have driven a noticeable increase in friendly fraud over recent years. This trend continues to worsen, making it more important than ever for merchants to stay informed about the causes, costs, and consequences of chargebacks and friendly fraud.
To assist with this, at CB-Alert, we’ve compiled a list of industries experiencing the highest chargeback rates in 2024.By reviewing and cross-referencing data, we aim to provide an accurate snapshot of the current chargeback landscape.
Why Some Industries Experience More Chargebacks Than Others
It’s not a secret that specific industries are more susceptible to chargebacks. Typically, we find that card-not-present transactions result in far more chargebacks than when the card is present.
Industries such as online dating and adults also result in chargebacks solely due to infidelity and spouses catching their loved ones.
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Chargeback Prevention Tips
Here are our favorite prevention tips for 2024:
- Use fraud prevention tools: Implement tools like 3DS2 authentication, RDR, and chargeback alerts.
- Add a merchant descriptor: Ensure your merchant descriptor matches your online store name for better recognition.
- Partner with CB-Alert: We help travel merchants stop fraud before it becomes a dispute.
- Communicate transaction details: Make sure customers understand what they’re buying, including fees and prices.
- Provide great customer service: Address customer inquiries and issues quickly to avoid dissatisfaction.
- Issue refunds when needed: Refunds are often cheaper than chargebacks and can build customer loyalty.
- Use clear billing descriptors: Ensure the name on the statement is clear to reduce confusion.
- Keep accurate records: Maintain detailed transaction records and customer communications.
- Monitor chargebacks: Use alert systems to track and address chargebacks early.
Industries With The Most Chargebacks
Below is a complete list of industries that deal with the most chargebacks in 2024. This list isn’t in order, but it outlines what we see in the chargeback landscape today:
E-commerce: High volume of online transactions leads to frequent disputes.
Retail: Return fraud and unauthorized transactions drive chargebacks.
Travel: Cancellations and disputes over bookings result in chargebacks.
Hospitality: Chargebacks arise from issues with hotel stays and restaurant charges.
Subscription Services: Trials and recurring billing disputes cause chargebacks.
Digital Goods: Non-tangible products like software often lead to chargebacks.
Telecommunications: Disputes over service charges and equipment often result in chargebacks.
Consumer Electronics: Returns and warranty issues frequently lead to chargebacks.
Online Gambling: Disputes over bets and winnings contribute to chargebacks.
Health and Wellness/Weightloss: Disputes over services and products often lead to chargebacks.
Fitness: Memberships and personal training services frequently see chargebacks.
Education: Online courses and educational materials can lead to disputes.
Beauty Products: Returns and dissatisfaction with products result in chargebacks.
Real Estate: Disputes over deposits and transactions can lead to chargebacks.
Automotive: Chargebacks arise from disputes over vehicle purchases and repairs.
Insurance: Disputes over policy charges and claims contribute to chargebacks.
Nonprofits: Misunderstandings and unauthorized donations lead to chargebacks.
Crowdfunding: Disputes over campaign pledges and rewards can lead to chargebacks.
Event Tickets: Cancellations and issues with ticket purchases lead to chargebacks.
Entertainment: Chargebacks arise from disputes over digital content and events.
Sports: Issues with ticket sales and merchandise can result in chargebacks.
Food Delivery Boxes: Disputes over orders and delivery services lead to chargebacks.
Coaching: Chargebacks occur over when students don’t see results from their expensive coaching services.
Online Marketplaces: Disputes between buyers and sellers result in chargebacks.
Subscription Boxes: Issues with recurring charges and product quality lead to chargebacks.
Jewelry: Returns and disputes over purchases often lead to chargebacks.
Home Improvement: Disputes over services and materials contribute to chargebacks.
Pharmaceuticals: Chargebacks arise from issues with prescriptions and over-the-counter products.
Financial Services: Disputes over financial products and services lead to chargebacks.
Online Courses: Disputes over course access and quality result in chargebacks.
Arts and Crafts: Disputes over custom orders and product quality lead to chargebacks.
Personal Services: Chargebacks occur from disputes over services such as personal coaching.
Pet Supplies Online: Disputes over orders and product quality contribute to chargebacks.
Luxury Goods: High-value items often lead to disputes and chargebacks.
Office Supplies: Disputes over orders and billing result in chargebacks.
Software as a Service (SaaS): Disputes over subscriptions and service quality lead to chargebacks.
Adult: Disputes over content and service charges often result in chargebacks.
Digital Subscriptions: Issues with recurring payments and access lead to chargebacks.
Music: Chargebacks arise from disputes over digital downloads and subscriptions.
IPTV Services: With many of these companies providing shady services, it’s no surprise IPTV made our list.
Craft Supplies: Issues with orders and product quality lead to chargebacks.
Transportation Services: Disputes over fares and services can result in chargebacks.
Firearms: Returns and product dissatisfaction lead to chargebacks.
Rental Services: Disputes over rental agreements and charges lead to chargebacks.
Art Supplies: Issues with orders and product quality often result in chargebacks.
Online Dating: Disputes over memberships and fraudulent profiles lead to chargebacks.
Put An End To Your Chargeback Woes Today
Applying with CB-ALERT is a breeze. Please provide us with the following information:
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- 3-6 months processing history of statements
- Voided check
- Principal’s driver’s license
- Proof of operating address
- Company EIN document
- Chargeback ratio
- A functional and compliant website with login credentials
Why CB-Alert?
Are you a merchant struggling with chargebacks? Look no further than CB-Alert.
Chargebacks can pose a significant financial risk to businesses. At CB-Alert, we’re dedicated to easing this burden and helping you regain valuable time.
With over twenty years of expertise, we are a crucial partner in your business’s success. Here’s what CB-Alert offers:
- Real-time alerts through Ethoca and Verifi
- 24/7 customer service support
- Transparent pricing models
- Comprehensive RDR (Representment, Dispute, and Resolution) services
- Compatibility with various gateways and CRMs
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