A Chargeback occurs when a credit card company rejects a charge made by a business because of a complaint filed by the cardholder. There are many reasons a chargeback may occur and several will be discussed below.
Reasons for Incurring a Chargeback
A buyer may file a chargeback claim for a number of reasons including:
- Non-Receipt: If buyers do not receive the items purchased, they can file a chargeback claim against Amazon fees on their card.
- Damaged Goods: According to the Amazon A-Z Guarantee, a buyer has the right to a refund if goods are received damaged. Some buyers, however, prefer to file a chargeback complaint instead of being reimbursed.
- Misrepresentation of the Item: If buyers feels that the item received varies greatly from the product description, they may file a chargeback claim.
- Illegal Use of Card: A common reason for filing a chargeback complaint is unsanctioned usage of the credit card. This often occurs when a card has been stolen or the information was retrieved by illegitimate means.
How to Recognize a Chargeback Notice
When a bank receives a credit card dispute from a cardholder, the company will contact Amazon. Once this chargeback claim is received by Amazon, they will email the seller with a notification informing the seller of the situation. The subject of the email will tell the seller immediately that this is the case. It will also include the order number, and the fact that a reply is expected without delay. The email will have a section that asks the seller to check whether the item was shipped via media mail or some form of traceable shipping method.
What to Do if a Chargeback Notification is Received
If a chargeback dispute is filed, the seller will be notified immediately via a notification email. It is within the seller’s best interest to deal with these matters expediently so as not to incur further penalties. When a notification is received, the seller should immediately respond with the requested information. This could include the shipping date and information such as shipping method or company and any tracking numbers that are related to the item in question, a confirmation email that the items had been received by the buyer or other such pertinent data that could assist the culmination of the process.
Any interactions between the seller and the buyer can also be useful at times, and these may be included within the response to the notification if relevant.
The Effect of a Chargeback on the Seller’s Account
A chargeback can adversely affect a Seller’s Performance Ratings. A seller can view the Customer Metrics section to gain a better understanding of all the factors that are involved within this formula.
Accountability for Chargebacks
Once the information is transferred, Amazon will contact the bank to argue the seller’s side of the situation. As stated within the Terms and Conditions, the seller is responsible for all chargebacks regarding quality or accuracy of the product. Chargebacks that were claimed due to stolen identity or other fraudulent accusations are the responsibility of Amazon, and the seller will not be held accountable for such claims.
A chargeback can take 90 days or more to reach a conclusion, and the seller will receive a summation email only if he is being held responsible for the fees. If no further email correspondence is received, the seller can assume that the matter has been taken care of and he is not being held accountable for the charges.
Disputing the Chargeback Claim
If a chargeback is determined to be the fault of the seller, the seller may contest the charges in an email response to the final notification. It should be noted, however, that once a decision has been made, that conclusion is generally upheld. Though it is possible for the seller to Appeal the Suspension of Selling Rights.
Protecting Against Chargeback Claims
Sellers are advised to follow several sensible practices in order to prevent a chargeback from occurring or to protect themselves in the event that one in filed.
- When shipping an item, the seller should copy the mailing address accurately and double check to ensure the accuracy before shipping.
- Using shipping methods that are trackable can easily allay any blame away from the seller, as there is concrete evidence concerning the location and shipping path of the item in question.
- The seller should retain all transactions between the buyer and the seller for a minimum of six months, particularly personal requests or requests to deviate from the standard procedure. These can be invaluable to a seller in the event that a buyer disputes a previously made request.