It depends. Its not always just about the ratio of chargebacks but also volume.
So you might trigger some flags with the card associations if you say have the following
1) 1% chargeback ratio
2) 1% of revenue result in chargeback
3) Have like 50-100 (forget exact number) of chargebacks a month for like x consecutive months.
If you don't fix the problem, then bad things happen like additional fines....etc.
So for merchants with very low volume, a higher chargeback rate is sometimes permissible. Acquiring banks have their own risk assessment so they may allow it or may not.
> What I'd like to see tho and I haven't seen it yet - is the ability to get the chargeback refunded in case I decide not to fight it. I know this usually involve some work on both sides, however I think this should be automated and the chargeback lifted if I decide to make Stripe's life easier.
This is unlikely to happen. The chargeback fee is levied on the acquiring bank (merchant processor) by the card associations which is then passed onto the merchant.
Best way to avoid chargeback fines is to have better fraud prevention process in place. Companies like Stripe are really just passing on costs that are imposed on them. Stripe offering to refund the fee if you win the case is a great gesture but only solves part of the issue with chargebacks in particular friendly fraud chargebacks.
Stripe has something similar to IPN? Many users have been asking us to build integration with Stripe so they can use have better fraud prevention but I didn't see an easy way to do this. If they have something like IPN, it might work.
I agree that this won't make much practical difference.
I think it depends on the chargeback reason code. If the chargeback was due to fraudulent reasons, merchants have very little chance of having it reversed. Now, they may be able to fight it and win based on procedural reasons relating to the chargeback dispute process. Not something worth doing though for most merchants.
Sometimes, its more costly in time to fight a chargeback than the fee that is imposed. Many merchants just let it go and eat the costs.
While there are higher risk, you can't really just blacklist them all since there are a lot of legit orders that get sent to reshippers. For example, customers buying from overseas and the merchant may not offer international shipping. So you have to look at other data points as well.
In this case, having an established order and delivery history and then to have it shipped to reshipping is odd and should've raised a flag.
I'm sure Amazon's fraud system knows about that address. But maybe that flag is not exposed or given to the csrs. That particular one in Oregon is used fairly frequently by fraudsters. We've seen it a number of times among our merchants.
They usually don't since they may not have the bank login information or be able to pass the bank's verification checks in order to change the registered info. Even if they do, merchants many times won't check because its very time consuming to call up the bank to verify shipping address.
Thats unfortunate that it causes you the hassle. But from the merchant's perspective, especially if they have been burned before, ship forwarding services are high risk.
Look at it this way. When you place your order, to the merchant, your IP will be from overseas, the credit card will be based in the US, and you are shipping to a ship forwarding facility. This is very typical of what fraud looks like with stolen US cards. The problem is that merchants bear the responsibility and chargebacks are a big problem, so they may not want to take the risk.
Thats true but I'm sure Amazon has some form of blacklist somewhere in their risk management process. Or maybe that is not tied to csr changes and only in order processing.
Having shipping patterns change especially to a ship forwarding sites is highly suspect. There are databases that can help flag these either done commercial or collected internally. I'm sure Amazon has a pretty extensive list.
So you might trigger some flags with the card associations if you say have the following
1) 1% chargeback ratio 2) 1% of revenue result in chargeback 3) Have like 50-100 (forget exact number) of chargebacks a month for like x consecutive months.
If you don't fix the problem, then bad things happen like additional fines....etc.
So for merchants with very low volume, a higher chargeback rate is sometimes permissible. Acquiring banks have their own risk assessment so they may allow it or may not.