When we hear the word “chargeback”, we often imagine something unpleasant — problems with money refunds or complicated disputes with the bank. However, not all chargebacks are conflict-based.

What are friendly chargebacks?

A friendly chargeback is a situation where a customer requests a refund through a bank, but does not do so because of fraud or unscrupulousness of the seller. For example, a customer might have forgotten about a purchase, thought that his card had been used without permission, or misunderstood the terms of delivery.

Simply put, such a chargeback is not an act of deception or an attempt to take money illegally. This is often a common misunderstanding or mistake that is resolved relatively peacefully. The seller and the buyer come to a decision without litigation and long disputes.

Why are there friendly chargebacks?

Despite their name, friendly chargebacks can be a problem for businesses. They happen for various reasons:

• The buyer’s misunderstanding of the terms of purchase. For example, the customer expected the product to arrive faster or in a different package.
• Forgetfulness. The person simply forgets about the purchase and initiates a refund.
• Lack of transparency in the card statement. The customer does not recognize the seller by the name on the bank statement and believes that someone has used his card.
• Error when placing an order. The buyer may order the product twice by mistake and request a refund for one of them.

One example of a friendly chargeback is buying an online game or subscription when the user has forgotten that they have subscribed to it. He goes to the bank, believing that money was debited from him without his knowledge, although everything was done legally.

How can a business reduce the number of friendly chargebacks?

Friendly chargebacks can damage a business, even if the customer’s intentions were good. However, there are ways to minimize their number:

1. Clarity in transactions. Make sure that the name of your company in the bank statement is easily recognizable and matches what the customer sees on the website.
2. Clear description of goods and services. Sell products with a complete and transparent description so that the customer understands exactly what they are buying.
3. Simple return procedure. Make refunds through your website convenient and fast. This will reduce the likelihood that the customer will go to the bank.
4. Regular subscription reminders. If you have a subscription model, remind users about debiting money in advance.
5. Customer support. Quick response to requests and solving problems directly with the client helps to avoid misunderstandings.

In some cases, friendly chargeback helps to establish a relationship with the client. If the company goes to the meeting and returns the money without further questions, it can build trust and increase the likelihood that the buyer will return again.

Friendly chargebacks are an integral part of an online sales business. Although they may be caused by mistakes or misunderstandings, the right approach to customers and transparent conditions will help reduce their number.