Selling intangible items online without a credit card?

Accepting checks or money orders only.

[menial]

Some online store owners I talk to are getting tired of fraudulent customers who do chargebacks for whatever reason. It seems that each year online shoppers become "smarter and smarter" and know how to screw online merchants that sell intangible items. Credit card companies help them as much as they can (since they don't lose any money on a screwed merchant; they actually make more money as they charge them an additional chargeback-review fee).

My question is - has anyone here who sell intangible items online tried not to offer credit cards as a payment option? Only check, money order, or "western union" types? Surely, there would be many potential sales lost. But if you offer truly a great service - would you try not to accept credit cards?

[justgowithit]

Dealing with fraudulent orders is incorporated in the cost of doing business.

But if you offer truly a great service - would you try not to accept credit cards

No. It would only be a matter of time before competition for your great service came along that did accept credit cards. If I came across a niche a business that seemed to be thriving without accepting credit cards my first thought would be the opportunity to compete.

[Corey Bryant]

Intangible items usually refer to downloadable products. Unfortunately this means now and using a money order or Western Union or any other form of payment that would require the customer to wait would potentially lose the sale.

Virtual (online checks) can be pretty good but of course they can bounce.

If you are having excessive chargebacks, review your policies. Though you might be able to cover almost every scenario, there will be customers who will be able to bypass them. If the customer does do a chargeback, consider also adding extra charges to his account and then sell the chargeback

-Corey

[menial]

It would only be a matter of time before competition for your great service came along that did accept credit cards. If I came across a niche a business that seemed to be thriving without accepting credit cards my first thought would be the opportunity to compete.

That's true...

Intangible items usually refer to downloadable products.

Yes + online services (like copywriting, editing, magazine subscriptions, etc.). But the problem is - credit cards couldn't care less about the merchant's own policies. If you send them your policies, they would laugh and tell you that their client claims something else and they obviously agree with their client (80% of the cases). Especially when the client claims the charge was [snip - don't want to give ideas].

[justgowithit]

Virtual (online checks) can be pretty good but of course they can bounce.

That's another can of worms.... :)

Whether the goods in question are tangible or not is really not the issue. Wouldn't you agree that the Internet public is increasingly impatient. Most people want their stuff yesterday and they'll go to the place that can come closest to satisfying that need.