Chargebacks are a great tool for banks to use in order to protect consumers from illegitimate companies whom offer tangible products and do not send them or send a different product instead. Who would want to ever pay for something they didn’t receive or didn’t select to buy. That’s easy to see, no one would.
In most circumstances a chargeback is a result by an action created by the consumer where they were to acknowledge that they were only authorized to take a chargeback action only in a last result situation; in other words, the consumer has to try to work it out with the merchant before submitting a dispute and is supposed to be coupled with the documentation of the attempt being made. Then and only then is the consumer have the legal ability to submit a dispute.
After filing a dispute with an authorized bank represent, the dispute has to be filed and then reviewed. In review, these banks are supposed to go to the contact the merchant for their businesses agreement information and then review it. The bank is legally bound to the guidelines as a third party in those agreements. They can not rule in the customers favor because the consumer is their customer. If the guideline of a business agreement is broken and the bank allows it, it is call willing blindness and there are laws for that too.
Victimizing Small Business
Ever pay close to $1000.00 in losses for trying to sell a $25.00 product/service because of a chargeback? It happens. That’s what some companies/merchants end up having to pay and the merchants hands are tied because the banks have the authority for some reason and there not following law correctly if their allowing it to happen.
Banks do it every day. Many business have suffered and have failed due to the willing blindness of banks. Every time a bank allows a self deluded customer walk in and file a complaint on assumption and then follow through with it has been in breach of laws. It is fraud to dispute for items you received in the mail unless it was not as described. It is fraud to dispute end business policy driven non-refundable charges. If a companies policy is no refunds, and the bank files a chargeback anyway, they’ve broken the law by allowing it.
It’s time to get our banks lined out, they are screwing up this world every second that goes by. When they allow this kind of stuff, they further our disaster and it is a disaster. The banks should be forced to follow law and not over rule policies agreed to by their customers. You can just bet many other laws need to be en-forced but you can’t cut any slack with these “COMPANIES”. These are companies just like regular mom and pop shop owners and they shouldn’t have the power and authority they do have. What’s funny, the banks bully governments. Want to know why? Banks can think up more ways to generate money and faster than the government can and are able to regulate it. It’s kind of like the banks and financial organizations have a courthouse full of lawyers figuring things out and are playing loophole games. Oh yeah, they have that too.
Once all this stops happening as much as it does, small business will began to make headway due to less loss.
What is loss? The question should be what is a gross loss?
Ruling in the merchants favor:
For a $25.00 non refundable service chargeback even in the favor of the merchant; the merchant makes $5.00 on the $25.00 after being favored against the consumer. So the merchant only gets five dollars less in some cases, and in some cases, the merchant owes in addition to the $25.00. Then the merchant has to pay the labor and all ending costs that occurred during the whole process. Even though they won the chargeback, they lost out anyway because the bank they and the consumer used charged.
Ruling for the consumer:
Consumer get’s money back, keeps product or declines payment for services, and it’s all virtually free to them where the company suffered maximum fees, cost for their product or service, pays higher service fees, has to pay the labor and all that. So what makes it worth it to be in business or a small business?
Either way you look a it, or who ever the bank favors, the merchant pays.
It is worth it to be in business, if you have a good product or service and where success is measured in the good a business does and not the amount of money you make. But when you get someone new or a small business just starting out, they don’t need this type of shenanigan, One chargeback for $25.00 could cost a thousand bucks folks and that’s not right and we have to stop this, otherwise small business will not grow and the banks will get even stronger.
While all this is going on, there are certain individuals targeting certain companies over the with these types of actions and if you are a merchant you should watch your back because they will do it to you, because they can virtually get away with it, they think.
Protect Small Business
As consumer require protection from illegitimate business, we need protection from illegitimate consumers who use such procedures to steal products and services. Small businesses are being abused like this every day. These banks or who ever makes a bobbled ruling and allow fraudulent disputes to be processed are breaking the law and should be stopped.