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Will buyer's signature help me to dispute a chargeback?
Trying to ship software on CD-ROM
Freddy81




msg:3895114
 10:24 am on Apr 18, 2009 (gmt 0)

I'm selling expensive (yet digitally delivered) software. I want to ship the software on CD-ROM to get the buyer's signature of receipt. Will this approach guarantee me from fraudulent chargebacks? Or what should I do to protect myself?

 

gpilling




msg:3895573
 2:50 pm on Apr 19, 2009 (gmt 0)

Have you had chargebacks or is this a theoretical concern? We are getting .5-1% of sales as chargebacks. It happens.

It will probably be cheaper to eat the chargeback than to pay for postage to the 99% of customers that are honest. Your experience may be different than mine, since I sell physical products.

Marley




msg:3895592
 3:39 pm on Apr 19, 2009 (gmt 0)

In the UK the answer is no. It can be fought through the merchant, say Barclays as an eg, showing them the card and delivery sig are the same, most of the time the end user "remembers" if you know what i mean.

I have got my chargebacks down to less than 0.5% introducing on the backend a traffic light system, eg: different delivery address, 1 point, authorization attemps, more than 1 attempt gets a point, value of order.

Once the end user get to five points, it flags red, order can't go out and is referred to a manager, then the procedure starts to complete that order.

Barclays were supposed to bring out an insurance policy against chargebacks, you pay in and they gaurenteed the monies, but this never happened, i wonder why!

ssgumby




msg:3896277
 5:29 pm on Apr 20, 2009 (gmt 0)

No - I had a signature and lost a chargeback. The customer simply said they didnt know who signed but it wasnt them.

LifeinAsia




msg:3896290
 5:54 pm on Apr 20, 2009 (gmt 0)

Given the cheap cost of digital cameras/cell phones, I think that in addition to getting a signature, the signer's picture should be taken. That would eliminate most of the "That's not my signature" chargeback rebuttals.

Maybe not make it required for every deliver, but make it an option, like requiring a signature for delivery. If the person refuses to have their picture taken, then they should have to provide a valid government ID.

Actually, I like that idea- adding an "require verification with government ID" option to shipping. If I had a high value product I was shipping, I'd probably be willing to pay extra for that.

Unfortunately, I doubt UPS/Fedex would go for it because it would slow down the deliveries. Then again, I can see that a lot of e-tailers might move their business to a shipper that DID offer such a service, IF it did its job of cutting down on chargebacks and the extra amount was reasonable.

ssgumby




msg:3896301
 6:00 pm on Apr 20, 2009 (gmt 0)

ahhh, a finger print scanner right on the fedex/ups signature terminal! Now that would be sweet ;)

LifeinAsia




msg:3896326
 6:24 pm on Apr 20, 2009 (gmt 0)

ssgumby- I like that! That would probably be cheaper than a camera and bring up fewer privacy issues.

Marley




msg:3896362
 6:58 pm on Apr 20, 2009 (gmt 0)

I don't think the picture idea would work but i like your thought pattern, anything to stop those mother..... i presume the bank will have to carry photo id, could cause a few issues there. I would hate to think if someone orders a dildo and has to have his picture taken, not sure if the repeat sales would be good, lol.

I am more in favour of the banks taking the hit rather the e-tailor, once 1 bank gets a insurance policy in place the rest would follow. At the end of the day they won't, its down to businesses to do what they can, but if the end user know's the system you have lost, best place that end user on a internal blacklist with the property and carry on trading.

Demaestro




msg:3896392
 7:32 pm on Apr 20, 2009 (gmt 0)

Without one of your staff witnessing the signature there isn't a lot of point since it would be impossible to tell who actually signed, also making it impossible to compare the signature to the one on the card.

Lightguy1




msg:3896431
 8:26 pm on Apr 20, 2009 (gmt 0)

I always gett screwed on chargebacks. If you ship-to a different address than the bill-to, there is not much a cc company will do. If this is the case and it is over a certain dollar amount I require a signature upon delivery. That way I do have proof they received and signed for the items.

I had a 3 chargebacks last week. Some old lady had her card stolen, reported it stolen, but it took her bank about 2 days to shut down the card. Needless to say, the fraudster placed 3 orders valuing 900+ total from me and they all went through fine cause her bank did not send a Declined signal yet.

Freddy81




msg:3896979
 1:21 pm on Apr 21, 2009 (gmt 0)

Thanks for your ideas guys. I guess that shipping the software on cdrom won't give me a significant advantage when it comes to disputing a chargeback.

Btw, the software has 2 license types which cost $500 and $1000 USD, so the chargebacks from dishonest customers are pretty much unpleasant. Since the software is niche and mainly used by companies rathar than individuals, I've removed payment links from our website at all - customers call or write to get one. We've got no chargebacks recently, but the cashflow dropped by 30%.

ytswy




msg:3897028
 2:34 pm on Apr 21, 2009 (gmt 0)

One of our sidelines is selling licences to some software, typical order values range from 100 - 2000 GBP depending on number of seats. We don't actually supply the software, just the key that unlocks the time-limited demo they download from the developer's site.

Anyway my point is that since the unit cost to the developer is nothing in software, they have always said that if we have any problems with fraud or chargebacks they will refund us since they haven't lost anything (never had a chargeback, but they've been very good when a customer has demanded a refund for whatever reason).

I'd always assumed that this was the standard way of doing it - maybe if you approached your supplier they could sort something out? It seems harsh that you are bearing all that risk...

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