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Payment Descriptors Can Prevent ChargebacksThe chargeback is one of the most dreaded financial activities for any business. It’s particularly likely—and unwelcome—during busy periods, such as the holiday season, when there is an increased amount of business. No business enjoys finding out that a credit card company is removing funds from the business bank account because a customer is unhappy with a purchase. However, when you agree to do business via credit card, the banks tend to find favor with the customer, not the vendor, meaning chargebacks are always a possibility.

But there’s one thing you can do to prevent unnecessary chargebacks from happening. It might not seem like such a big thing making sure you have a clear, informative payment descriptor can make a huge difference in chargeback prevention!

People Don’t Always Remember

In a surprising number of cases, one of the most common causes of a customer getting in touch with the credit card company and asking for a refund—that results in a chargeback to you—is because of poor payment descriptors. Even when you’ve clearly laid out an item description, laid the terms of payment processing, and then sent the customer a product or service they actually wanted, to their satisfaction, a bad payment descriptor can cause a chargeback.

The reason is embarrassing but simple. Sometimes people simply don’t recognize the names they see in a payment descriptor, especially if the purchase was made a few weeks ago. While reviewing their credit card bill for the month, they see a name they don’t remember, and think that maybe identity theft has occurred, and someone has used their card to make an unauthorized payment.

Ensuring that your payment descriptor is the name of the storefront you manage—rather than a parent company customers may be unfamiliar with, for example—is a good way to maintain familiarity. If the name of your business, and the name on the payment descriptor don’t match up, this can sometimes cause unintended problems and lands a chargeback at your doorstep!

Posted in Chargeback on Dec 27, 2018