Businesses of all kinds face chargebacks or payment disputes when customers disagree or question the validity of their purchase. Here are a few preventative measures retailers can take to protect their business. This article is for educational purposes and does not constitute legal or tax advice. For specific advice applicable to your business, please contact a professional.

Ways to prevent fraudulent transactions

Businesses of all kinds face chargebacks or payment disputes when customers disagree or question the validity of their purchase. There are a few preventative measures that retailers can take so that they are prepared in the event of a fraudulent or a non-fraudulent transaction that results in a dispute. Typically in the case of a chargeback, the customer will ask for a payment to be reversed. If you use Invu or another payment processor, they will be notified and reach out to you, asking whether you’d like to challenge the dispute or issue a refund.

Here are a few ways you can protect your business against fraudulent transactions:

• Keep a record of purchases.

Having customer information such as an email, a name, and an address for an order can help you make sure the package was delivered to the right place and to the right individual.

• Invest in customer service.

Whether you hire staff or use customer engagement tools, there are ways to stay in touch with customers. Customer engagement tools such as private messaging, customer insights for new and returning customers, or a customer directory can help you manage communications and keep track of potentially critical information.

• Consider risk management software.

here are a range of software available to businesses looking to prevent fraud more proactively. These software can monitor payments and identify unusual or fraudulent patterns.

• Offer delivery confirmation.

There are several ways you can show a confirmation of delivery in the event of a dispute. By requiring a customer signature upon delivery, by requesting the delivery service to take a picture of the delivery, or by using a delivery tracking software that can update both the business and the customer on where the package is, you can show that you delivered an order to the correct address by an agreed-upon delivery date and to the intended recipient.

Ways to prevent non-fraudulent transactions

Sometimes a legitimate customer will chargeback in lieu of contacting a business directly over a purchase they have made. According to a Javelin Strategy & Research study, merchants estimated about 34% of chargebacks they experienced were, in fact, friendly fraud. ” Unlike true fraud, it may be done unintentionally. This can happen for a number of reasons: perhaps the customer felt the item was lost or stolen; a family member made a purchase on their behalf; they did not qualify for a refund; they forgot they made the purchase; or they didn’t recognize the business name on their bank statement. Here are a few ways you can protect your business against non-fraudulent transactions

Communicate delivery times.

When customers are unsure whether a package is still on the way to them, they may worry it is not coming or forget they ordered it when it does arrive. If your products are made to order, communicate in advance that there may be a wait before the item arrives. In addition to this, consider letting a customer know when an order is being prepared or filled and when it has shipped. This will give them a better expectation of when it will arrive.

Help manage customer expectations if a popular item is out of stock. Offer to notify them when it is in stock or mark clearly how long the wait might be. If customers check out a preorder or out-of-stock item that takes longer to ship, they may expect it to arrive sooner than it does