

Ask HN: How common are credit card disputes? - ydevnow

I run a SAAS website, and recognise that we have some workflow related payment blockers. Putting that aside, we&#x27;ve had cases where customers were actively trying to cheat us out of paying for services provided by us.<p>I was wondering how frequently this happens, and if the data differs across industry or types of services. How common are credit card disputes at your company, and are they legitimate or are customers trying to cheat you out of paying?
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jasonkester
Not overly common, but always baffling when we get them.

For both my paid services, I send an email every time somebody's card is
charged. The first line explains the charge, and the next _two paragraphs_
tell you how to learn more about what we are, why we charged you, how to
cancel, and that _we are happy to refund you for any reason_.

That last bit is an entire line by itself.

And then we still get a handful of chargebacks each year. Usually from the
boss, who gave his card to an underling to buy our thing. And often they'll
remember this when I remind them and _still not cancel the chargeback_.

It's frustrating.

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toomuchtodo
Do you dispute the chargeback, providing the necessary evidence to the
processor?

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MalcolmDiggs
> _if the data differs across industry or types of services._

You hit the nail on the head here. In the more "degenerate" spaces,
chargebacks are high. The more trustworthy the products/services, the higher
ticket the items, and the more gracious the return policies, the lower the
rate of disputes.

So for example: If you're running an adult site selling pay-per-download
pornography for 99 cents, you're going to see tons of chargebacks and disputes
all the time. If you're selling high-touch services (like Notary-Public
services or something), where there is a trust-relationship between you and
the buyers, your rate will be much much lower.

There are a lot of factors that raise and lower the chargeback rate, but I've
found industry and type of services to be the most important. People charge
back for all kinds of reasons (regretting the purchase, slow delivery, finding
a better deal elsewhere, not wanting to deal with customer service), but
generally the better the relationship between your company and the customer
the lower the dispute rate will be. The more they respect you and what you're
selling, the more they admire your brand, the lower the rate. If your brand
comes off as a snake-oil-salesman, there's no trust there, no respect, and
here come the chargebacks. Hope that helps.

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devcheese
Very common with the company I work for now. People will buy our product and
dispute. The credit card companies usually obey it.

