Chargebacks can’t be left in ignorance. They can impact your credit score negatively. So, how do chargebacks affect your credit history? Can you obtain a high-risk merchant account without major headaches? Find the answers below.
Chargebacks & High-Risk Merchant Account
Let’s start with the definition. So, a chargeback is a dispute of a purchase (already charged to an account) that can lead to a return of funds. Banks keep the record of your chargeback history. When faced with a higher rate of chargebacks, you’re going to have a poor credit score.
What about chargebacks vs. refunds? In the 1st case, the customer contacts the credit card company or bank for a refund. The 2nd one has more to do with the business associated with the purchase made.
How are you fighting chargebacks? What about fraud? In fact, you won’t have any problems at all if you work with a reliable and secure merchant services provider that specializes in the high-risk field. A respectable high risk processor will provide you with the cheapest possible high risk merchant account, as well as exceptional solutions to fight chargebacks and fraud.
How Chargebacks Affect Your Credit Score
Chargebacks can result in more than just missing out the money that was disputed. Expect to lose also the money on chargeback fees. In addition, you’ll also lose the time and funds you spend selling, packaging, and delivering the goods.
Because of the higher rate of chargebacks, you won’t be able to obtain lower cost credit card processing services. Fortunately, there’re reliable processors and alternative online lenders that’re ready to work with your type of business and offer the cheapest fees possible.
Moreover, you can also lose your merchant account because of higher rates of chargebacks. That’s where true high-risk processing experts come into play. They can help your high-risk business overcome the challenges on its way without major difficulties.
As you see, chargebacks are like refunds, but they aren’t the same. A large number of chargebacks will put rocks on your way: higher payment processing and business funding fees, loss of your merchant account, and more. So, find the right merchant processor in the high-risk space to avoid falling into obstacles.