Let’s face it, the way we do business has changed and you may be accepting more payments without a card present. A card-not-present (CNP) transaction is when a customer buys something online or over the phone and you don’t have access to the card used. From curbside to online, here are a few ways to help prevent card not present disputes no matter how you’re doing business.
You can prevent disputes and fraud with these handy tips
- Cancellation and Return Policies: Clearly display your policies. Provide tracking once order ships and use an “I agree” checkbox prompting policy acknowledgment during the order process.
- Confirm Identity: Confirm the customer’s identity by asking for the complete billing address and the CVV code on the card.
- Tracking: When shipping products, send tracking information once the order ships.
- Recurring Transactions/Subscriptions – Send an email reminder before each cycle
- Cancellation and Return Policies: Clearly communicate your policies with your customers.
- Verify Shipping Information: Confirm you are shipping to your customer’s billing address. If not shipping to the billing address, ask for a “ship to” address and send tracking information once the order ships.
- Shipping & Delivery Expectations: Set clear expectations on delivery time frames and update customers if there are changes.
- Send Order Confirmation: Includes details of the order and relevant policies. For services, be sure you clearly communicate your terms & conditions and cancellation policy.
Curbside Pickup Orders and Deliveries:
- Order Confirmation: Send confirmation as soon as the order is completed that includes your policies and pick-up instructions. If someone other than the Card Member is picking up the order, be sure to note this on the order invoice and confirmation.
- Get Receipt Acknowledgment: Have the customer sign the credit card receipt when the order is picked up or delivered. If the customer’s email address was captured when the order is placed, send an order status with pickup details such as the date, time, and person who received the order. NOTE: This can act as a supporting document in case of a dispute.
Best Practices for Managing Disputes with Card Not Present Purchases
There are three types of chargebacks where the customer calls his or her credit card company or bank to reverse a charge. Below we’ll look at all three and ways you can insolate yourself from giving back your hard-earned money.
No knowledge on the part of the Card Member
- Use the name your customers know your business by on your merchant account. This way your customer recognizes the charge on their card statement.
- Include the customer service phone number on statements
- Explain auto-renewal and auto-shipment terms for free trials, reiterate your cancellation policy in your confirmation emails and include the steps the cardmember should take once their trial ends
The Card Member claims that the transaction was returned or canceled
- Clearly display return and cancellation policies
- Note “non-cancellable” or “non-refundable” purchases
- Call out advance payments that are billed immediately
- Send a reminder 10–30 days before auto-renewals or recurring billing
- Issue refund credits promptly
The Card Member claims that the goods/services were not received
- Hold the charge until shipping or service date
- Notify customers about delays in fulfillment
- Confirm when subscriptions will begin