Somewhere along the way, many software companies got stuck in a belief that chargebacks are just a part of selling software online and cannot be avoided. They just choose to ignore the problem. Although it is almost impossible to entirely avoid chargebacks when selling software online, most of them can be prevented, mitigated and disputed in the end.
- Inside-out analysis of chargeback processing by financial institutions
- Risks and damages caused by chargebacks
- Key features to look for when selecting an e-commerce provider
- Industry best practices in chargeback prevention
Often the cost of chargeback processing fees can exceed the original cost of the product. These can vary between $15-$100 per dispute. Even if the company has a 100% dispute win ratio, the real threat behind chargebacks are the negative statistics which cannot be reversed. Together with negative statistics, reaching 1% threshold in chargebacks can threaten a software company in losing one of the most popular payment methods for its online store. Without payments, there would be no online marketplace for software.
In the digital age, information is power. The more a company knows about the risk associated to chargebacks, the less vulnerable it is in front of this problem.
What is your average chargeback ratio? What steps do you make to avoid them?