Credit Card Chargebacks

what percentage of your sales are they?

[wingslevel]

I operate 5 ecommerce sites and I average about 2.5% About .5% of this is pure fraud. What kind of numbers are the rest of you getting?

What are you all using to combat chargebacks? AVS (address verification)? Are you accepting orders from free email accounts (yahoo, hotmail etc.)?

[gaouzts]

I operate 5 ecommerce sites and I average about 2.5% About .5% of this is pure fraud. What kind of numbers are the rest of you getting?
What are you all using to combat chargebacks? AVS (address verification)? Are you accepting orders from free email accounts (yahoo, hotmail etc.)?

We have been able to get it down to less than 1%. We don't use AVS as 60% of our orders are international and many use the free email accounts. We have found no correlation with fraud and free email accounts. Our processor employs IP filtering, stolen card data base and their own rule-based technology which has really helped reduce our exposure.

[wingslevel]

We have just begun using avs - we are using pccharge - and there are some problems, initially we were getting high decline rates because of address mismatches (P.O. Box <> PO Box) - now we are just putting the address numeric in the field and the results are more meaningful.

On the subject of address matching, how about separate ship to addresses? If we get an approval on a charge and the billing address is a match but the product gets shipped to a separate ship to address, do we "own it" if the charge is later disputed?

As for free email accounts, they comprise 16% of our sales and 75% of our problems. Let's face it, if you just stole a credit card and you want to order some stuff online, you aren't going to give the vendor your earthlink account. Lots of people who have a hotmail account also have a "real" email address which they choose not to use for privacy reasons - if we stopped accepting free email accounts, I wonder how much of the 16% we would lose? Is it like when I am at a restaurant that won't take my amex (I pull out a visa)?

[gaouzts]

As for free email accounts, they comprise 16% of our sales and 75% of our problems. Let's face it, if you just stole a credit card and you want to order some stuff online, you aren't going to give the vendor your earthlink account. Lots of people who have a hotmail account also have a "real" email address which they choose not to use for privacy reasons - if we stopped accepting free email accounts, I wonder how much of the 16% we would lose? Is it like when I am at a restaurant that won't take my amex (I pull out a visa)?

Unfortunately, too many of our customers want to use their free email address as they set them up for use in any purchase where they might suspect that they will get spam (we don't spam, of course).

Ideally, you would want to give your customers a way to register their free email address with you so they could use it in purchases (like a preferred customer or a verified customer). I agree on the problem, it would be good, though, to find a solution that would let customers continue to use their free email address without raising suspicions or making it too inconvenient.

[sun818]

Our rate is virtually 0% but our average is under $25. I'm not sure, but I believe the credit card holder pays up to $50 out of their pockets.

how about separate ship to addresses?

For international transactions, we disallow orders that have different billing and delivery addresses. We had one once had a billing and shipping address that were in separate countries... I mean come on!

For domestic deliveries, the only ones we double-check are the ones with a different delivery name than the billing name. Sometimes it is a company name and other times it is a gift for someone.