Notes to an issuing bank on chargeback prevention and improved customer experience
The summer sales are in full swing, packed full of discounts, offers, and flash sales from all your customers’ favourite brands. That’s great for business. On the flip side, bank contact centres will soon be flooded with a record number of calls, and chargeback prevention could soon become a time-absorbing and costly focus on operations.
A recent report from Aite Group found that when it comes to transaction disputes, 86% of customers skip past merchants and go straight to their card issuers. When it’s easier and faster for a customer to file a chargeback through their card-issuing bank than to reach the selling merchants, you may have a major business problem.
It happens every year and means the same thing—longer hold times, longer payment dispute conversations, and larger chargebacks queues. The truth is, customers don’t like to be put on hold when calling to dispute something they didn’t buy. Moreover, studies show that after an average of 1 minute and 55 seconds of hold time, most callers hang up frustrated—and over one-third of those callers who hang up will not call back.
Positive Customer Experience
This interaction inevitably leads to a negative customer experience, which can often be avoided. Queues are the bane of the contact centre industry and one of the aspects that receives the most complaints. Issuers that must deal in a real-time, online world are acutely aware of how serious a challenge this is—with lost customers and increased operating expenses a very real by-product of negative customer experiences.
We know the purpose of any business is to be profitable, and in doing so create emotional connections with their customers to develop return visits and loyalty.
You may or may not be able to plan what your customers’ experience will be, but, nonetheless, an experience will take place. One negative customer experience can make or break a business-customer relationship, and is usually followed by customers breaking down the negative experience with friends and loved ones.
Similarly, a highly positive customer experience generates loyalty, repeat business, and word of mouth support from happy customers. These customers tell friends so they can repeat the experience together. Friends want other friends to enjoy positive experiences, and as a result they will recommend your business.
From an issuer’s perspective, chargebacks can be a root cause of negative customer interactions and a costly hassle and drain on resources, so chargeback prevention is a priority. The chargeback process was originally instituted to increase consumer confidence, though it’s now very easy for credit card users to dispute charges and take advantage of this process. Invariably, merchants and issuers must do all the legwork to determine whether a transaction is legitimate.
Current inefficiencies in the chargeback process lead to many expensive problems and operational costs for card issuers, including:
- Loss of revenue
- Increased costs and representment volume
- Increased small-balance write-offs
- Customer dissatisfaction/negative brand association
- Unmanageable pend queues and lower productivity
- Increased dispute volume/inability to handle disputes on first call
So, how do you create positive customer experiences? Eliminate pain points and provide immediate gratification. Reducing the pain your customers feel will go a long way towards creating a positive experience.
Secure Payment Solutions
Customers want intelligent solutions that provide them the answers they need, quickly and efficiently. If you get a lot of chargebacks, are operationally hampered by the dispute process, or prefer to engage dedicated, expert help to deal with chargeback issues, then know that our chargeback prevention service, Order Insight, was designed with the issuer’s need in mind for reducing costs and retaining valued customers.
Order Insight is a merchant-issuer collaboration platform that provides robust details on order information of cardholder transactions. If a consumer elects to contact the issuing bank, their call centre staff will have access to the order details, such as merchant name, address and phone number, product or service details, date of transaction, etc. This way, the issuer can quickly resolve billing confusion, validate the sale, or flag it as true or first-party fraud, so merchants can retain sales and avoid losses to unwarranted chargebacks. In short, Order Insight delivers the insights necessary to provide an enhanced customer experience.