In addition to the direct financial losses related to refunding transactions, chargebacks can also have indirect negative consequences for your organization.
Financial Impacts
Direct Costs: A fee of $40.00 is charged to the organization for each lost chargeback;
Refund of the Disputed Amount: The transaction amount is refunded to the cardholder;
Increased Credit Card Processing Fees: Card issuers may increase credit card processing fees for organizations with a high chargeback history;
Holdbacks from Your Payment Platform: Your revenue might not be easily accessible;
Loss of Revenue: The chargeback represents a loss of revenue for the organization.
Reputation Impacts
Reputational Damage: Chargebacks can harm the organization's reputation among consumers;
Loss of Customer Trust: Customers may be less inclined to make purchases from an organization with a high chargeback history;
Refusal of Service by Payment Platforms: Some platforms may refuse to do business with your organization if you have a high chargeback history.
Learn more about Chargebacks