Skip to content

Help! I just got a chargeback!!

Join our mailing list

Signifyd regularly publishes free reports packed with business insights, commerce trends and data from our massive Commerce Network. We’ll only email when we have something meaningful to share, no more than once per week. And of course you can unsubscribe any time.

When setting up an online store, it can be an exciting time. You are building your website, uploading images of your items for sale and building out a loyal customer base that will help you increase sales as you lift your brand from nothing to a recognized symbol. Like many customers who have reached out to Signifyd, chargebacks and fraud was never even on their radar, until they got one.

Signifyd often receives phone calls that follow a format similar to this, “Hi, this is Joe from ABC company and I need help right away. I just got an email from my bank telling me that they are reversing the funds on this really expensive order and I don’t know what to do. The guy sounded legit, I looked him up but now he is saying he didn’t place that order but I already shipped the product. I need to prove that he placed the order!!”

Such frantic phone calls are often heartbreaking because more often than not the merchant who called in is ultimately going to lose out on both their cash and their product. Banks frequently side with the cardholders, and re-reversing funds is very difficult. Many merchants don’t take into account that fraudsters will answer the phone and talk to them, or that a fraudster will manipulate his IP address to give the appearance of living at the cardholders residence. Even worse are legitimate cardholders with a history of buyers remorse or are purposely seeking to steal online through the chargeback process.

So when merchants first start selling online and they see an odd order, it’s not unusual to them that if they should be able to get a hold of the customer that they should be able to ‘sort things out’. It is only after they realize that they have been duped do they become fully aware of the risks of selling online. But selling online is the future. So learning about ecommerce chargeback protection is very important for merchants looking to avoid them.

To learn fully about chargebacks, check out a previous post that Signifyd wrote up that helps define what chargeback fraud is. In todays post though, lets get the facts on the table. The fact is, if you have a chargeback there is very little you can do about it. The key is learning how to avoid them, and there is a tool on merchants side. Everyone online leaves a digital footprint. From the devices they use, the social networks they log into or the emails and phone numbers they register online. From the moment they create any kind of a presence, it has a history and that history can be either good or bad but it is never neutral. And that history can be tracked and is by companies like Signifyd.

Currently only about 5% of all shopping is done online, and yet that number poised to explode in the coming years. With that expansion is going to come all sorts of histories that internet users are going to leave behind. Every email, every IP address, ever card used is going to have a history of good transactions or of fraudulent ones. The key is to find and utilize that data to prevent chargebacks.

Don’t fight chargebacks, avoid them

Signifyd has an enormous database of knowledge, and plugs into other database providers to fill in the gaps that we currently don’t have to provide a global user database of internet history. Every time a shopper makes a purchase from one of our merchants, we can tell that merchant if the IP, phone number, device, card, email, and address or social media account is a good account or if it has fraud or chargebacks in its past.

Research shows that in the war against online thefts, the trend is going away from one off users making bad purchases online and is going towards cyber gangs who steal online. Therefore, if a Russian gang for example steals an American’s credit card and places a delivery address that Signifyd has registered as a bad address known for fraudulent orders or is associated with chargebacks, Signifyd can alert the merchant and advise them to cancel the order.

Tracking all of these histories by themselves would be an arduous task for any one merchant to tackle by themselves, but with Signifyd merchants get unprecedented analysis into their customers and who is most likely a good customer and who will likely place a chargeback.

So if you are a small but fast growing merchant who has just been hit by a chargeback, we offer our condolences. It’s a brutal growing pain, and likely won’t be the last chargeback you ever go through. But the collective power of the Internet is a tool that’s on your side through Signifyd, and together we can stop those who would seek to steal from you.

If you are a merchant who is suffering from chargebacks, consider signing up for a 2 week free trial with Signifyd and witness for yourself what professional fraud prevention services can do for you company and bottom line. Reach us at [email protected]



Signifyd, the leading commerce protection provider to Digital Commerce 360's top 1,000 merchants, provides an end-to-end Commerce Protection Platform that leverages its Commerce Network to maximize conversion, automate customer experience and eliminate fraud and customer abuse for retailers.