Chargebacks 911 to Online Merchants: How to Avoid Inadvertent Double Refunds

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Chargebacks 911, a company established to provide solutions to merchant chargeback issues, explains how double refunds occur and the best way for merchants to prevent them.

Chargebacks 911

While chargebacks are an unavoidable aspect of e-commerce, double refunds can and should be prevented through conscientious merchant practices.

Online merchants often pay a steep price when it comes to chargebacks (which occur when a consumer disputes a charge made on their debit/credit card). Recipients of chargebacks often lose the sale, associated product, valuable time and the fees from card issuers (banks). But those are not the only losses for merchants, as “double refund” scenarios have been discovered—these mishaps originate when consumers receive a refund from both the merchant and their bank for a single transaction. Chargebacks911, a mitigation company that services merchants and financial institutions, says that double refunds can be prevented by being proactive business owners and implementing simple measures.

Acquiring excessive chargebacks puts online retailers in jeopardy of having their accounts closed, paying unnecessary fees and, in some extreme cases, losing their business. Chargebacks alone are detrimental to any e-commerce business—but coupled with double refunds, merchants are essentially thrusting themselves into an unbeatable situation.

How Double Refunds Happen

Chargebacks 911 estimates that approximately 12% of all chargebacks have been refunded by the merchant; the refunds are sometimes issued from the merchant prior to initiation of the chargeback, but are often—unbeknownst to the merchant—also issued after a chargeback has already been initiated. As a result, the loss for merchants is increased—they lose the money that they refunded to the consumer, as well as the fees resulting from the chargeback.

In similar cases, the consumer will contact both the merchant (to demand a refund) and their bank (to initiate a chargeback). The customer not only receives a refund from the merchant, but also from their bank following completion of the chargeback. In essence:

● Providing a refund does not always dissuade consumers from initiating a chargeback; and

● Just because a customer filed a chargeback and was promised a refund by their bank doesn’t guarantee that they won’t contact you and demand a refund from you, as well.

How to Prevent Double Refunds

Chargebacks 911 says that the best way to prevent double refunds is for merchants to train their customer service representatives to know what to listen for before issuing refunds to customers:

● Pay close attention if a customer calls and states that they just spoke to their bank. This information is the largest clue that a chargeback may already exist for the transaction.

● If a case number has been issued by the cardholder’s bank, the dispute has graduated the status of a chargeback. In this case, do not issue a refund—you are already going to be charged the associated fees, and the funds will be levied against your merchant account.

● In the event you suspect a chargeback, offer to connect the call with the customer and their bank. This will enable you to verify that a chargeback does not yet exist before attempting to provide them with a refund.

● Be wary if a bank representative offers to “resolve or close the case if you issue a refund now.” Bear in mind that a case number usually means there is already a chargeback—you have already been charged for this transaction, and a forced refund was subsequently provided to the customer. Your best options are to either fight the chargeback in order to win back your money (because the customer did not legitimately deserve a refund in the first place), or to consider the customer to be in the right, and allow them to obtain a refund through this method. (1)

The founder of Chargebacks 911, Monica Eaton-Cardone, says that chargebacks have liberalized the dispute process for consumers. They are now able to essentially get something for nothing, often leaving merchants to pick up the pieces — but, Eaton-Cardone continues, merchants should not accept the inequality and must continually strive to protect their businesses.

“Today, the chargeback dispute process largely favors consumers,” said Eaton-Cardone. “Merchants need to acknowledge this and be proactive in doing what they can to limit their risk. While chargebacks are an unavoidable aspect of e-commerce, double refunds can and should be prevented through conscientious merchant practices.”

Chargebacks911 provides fast and reliable solutions that not only help recoup the loss of funds as a result of increasing chargebacks, but also help to curb future chargebacks so that merchants can retain processing abilities.

Chargebacks911 specializes in servicing those whose primary transaction activity is classified as card-not-present.

For more information on Chargebacks911, visit

About Chargebacks911:

Co-founder Monica Eaton-Cardone established Chargebacks911 in September, 2012 out of necessity, after many years as a merchant struggling to find a solution to chargeback issues. Chargebacks911 was developed specifically for merchants to offer immediate aid through proprietary technology, and provides the necessary function that gives merchants the freedom to focus on their core competency and optimize their in-house skill set. Chargebacks911 specializes in servicing Internet merchants, and offers both response and resolution services for chargebacks and cardholder disputes. The company works with merchant clients to help them keep their dispute rates down and retain their ability to accept credit cards. Chargebacks911 provides a unique exception to standard dispute processing for dissatisfied consumers who wish to remedy transactional disputes without the requirement of additional intermediaries or lengthy correspondence requirements. For more information, visit

1.“Prevent Giving Customers ‘Double Refunds’.” Chargebacks 911, n.d. Web. 31 May 2013.

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Alyssa Kaplan
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