9 secrets of online payments. Part 8: Returns - and How to Avoid Them

Can there be something more offensive for an online store than lost profit? Can! Even more offensive is the situation when the money has already been credited to the account, and the client or the bank suddenly demanded to return the funds back to the payer's card. Especially if the service has already been provided or the shipment of goods has already taken place. What to do in this case? About this - in the new, the penultimate material of the cycle "9 secrets of online payments", in which the eight-year experience of the PayOnline team is concentrated .

Imagine a situation: a buyer makes a purchase using a card, but for some reason the product does not suit him. The client returns the goods and initiates the so-called refand (English refund) - a voluntary refund of the payment made earlier on account of the purchase with a bank card. Most often it is carried out at the request of the buyer. Another case is card fraud, and there may be different situations. First, a friendly fraud (from the English fraud - fraud) - when an attacker makes an order for a large amount, the goods are shipped to him, and the online store receives a request for a refund of the “real” cardholder. According to the legend of the accomplice, his card was stolen, and they made a purchase from it. The “real” cardholder demands to return the money to him, and if the bank stands on his side, then the online store remains without goods, and without money.

Part 1. Setting up 3D Secure
Part 2. Recurring payments
Part 3. Payment selection page
Part 4. Payment Form
Part 5. Mobile payments
Part 6. Payment in one click
Part 7. Fraud monitoring system
Part 8. Returns and how to avoid them.
Part 9. Payment service settings for the type of business

Secondly, these are real cases of card theft for the purpose of making purchases without the knowledge of the owner. Even if the fact of fraud could be detected, and the goods have not yet been delivered, the online store still loses the commission for processing the transaction by the processing center. Such returns are called Chargeback. This is a procedure for debiting funds from an account of an online store or another e-commerce enterprise by an authorized, that is, a previously made payment, initiated by the cardholder or issuing bank. Often the procedure of charge-back is made in accordance with the rules of the international payment system in case of their violation by the enterprise of electronic commerce.
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The first task to reduce the number of returns falls on the shoulders of the online store. It is he who is most interested in preventing such situations. The entrepreneur has many motives: first of all, this is his income, secondly - minimization of the risk of non-refund of the commission for the transaction; In addition, the online store may lose customer loyalty. What methods can be used to fight returns?

Site Requirements

In the process of connecting the payment acceptance system to the site, there may be many demands imposed not only on the security of transactions. Here is an example of some requirements for sites that plan to use a PayOnline connection:

It is recommended to place on the website the minimum amount of reference information:

• Description and consumer characteristics of each product / service. Description of the procedure for ordering goods / services.

If the buyer purchases a product and then decides to return it back, arguing that “I did not know that it was too big / small / of a different color”, it means that the information on the website was not enough. The clearer and more accessible the product description is formulated, the more high-quality photos it describes, the less likely it is that the buyer will not buy what he wanted. Accordingly, the less there will be cash back cases. The same situation with the order procedure: for example, if a customer wanted to buy one issue of an online magazine, but accidentally subscribed for a year, every month his card will automatically be debited - this option is available if you tick the “Autopayment” box when making order. Naturally, the client will be dissatisfied and will demand to return funds for the service, which he was not going to use at all so often. To avoid this, make every step of the ordering process very clear.

• The list of available payment methods and description of the payment procedure. Information about the refund process.

The return procedure is an unpleasant process for all participants. Terms of returning funds to a bank card are regulated by payment systems and can be up to six months. Perhaps, if the buyer finds out about this, he will nevertheless decide to keep the product that he had spontaneously bought earlier, but then simply changed his mind and decided to return it.

• Contact phone number and e-mail address of your company.

Of course, the ideal option for an online store would be to have a call center where customers can get support on issues of interest to them. The problems with payments are complicated by the fact that not every online store specialist can provide comprehensive advice on them. Transactional difficulties associated with the work of several banks and the processing center, the laws of the country and the ICS (Visa, MasterCard). Payers can be supported by the payment system itself - for example, in PayOnline it is a round-the-clock multi-language call center. But issues related to the return of goods - the area of ​​responsibility of the online store. If the client could not “reach out” to his representatives and tell about his problem, the refand will turn into a charge back (due to the client’s application to the bank that issued the card) - and this is a heightened attention to the online store with point of view of its security.

• Information on the delivery of goods and the rules for the provision of services (including export restrictions and rules for the delivery of goods outside the Russian Federation, as well as restrictions on the provision of services).

In the case of the delivery of goods, the situation is the same as with its description: if it is not obvious to the customer how much the delivery will cost and what its terms are, he can change his mind after payment. The more detailed description of the products and processes of their purchase, the fewer returns from the online store.

Anti fraud

If an online store faces fraud too often, banks may refuse to work with it, and it will not be possible to accept cards or other online payment methods. To combat fraud, there are a number of technologies (PayOnline told about them earlier in previous articles of the cycle “9 secrets of online payments”).

• AntiFraud fraud monitoring system. In the automatic mode, it checks the transactions and literally “makes them verdict”: if the card operation seems suspicious, it is checked especially carefully, up to manual skipping or cancellation.
• 3-D Secure - security protocol. This is the requirement of the IPS to the payments to confirm the identity of the payer. Most often, the client is required to specify a code generated specifically for a particular payment that comes in the form of an SMS message. Some online stores disable this feature in order not to lose customers, who may mistakenly enter a wrong code or their card is not subscribed to 3-D Secure, but this leads to additional losses due to fraud.

Setting up a payment service

Another possibility to avoid refunds for online stores is to freeze funds on the payer's card. It enjoys particular popularity among large retailers during the period of their active growth or sales. Laughter is simple: the client draws up the goods on the site, and the desired amount is frozen on his account. After the online store confirms the availability of goods and the willingness to deliver it to the customer, a payment transaction takes place and the money is debited from the card. PayOnline partners shared their impressions of this option, saying that during sales, when orders went one after another, the online store employees simply did not have time to quickly check the availability of goods. Using the freezing of funds on the map, they collected orders and at the end of the day checked that they could be delivered the very next day, and which products were out of stock. In the second case, the client was offered an alternative option, or the amount of the payment on the card was unfrozen on the same day.

This method solves several problems at once:

• Sale of goods. Even if it is not available, the seller can always add the necessary amount by offering the customer a bonus for longer delivery.
• Offer alternatives. The seller can pick up the goods, which may be a little more expensive, but the buyer will like it no less. Perhaps the client did not even know about its existence, but the seller was able to establish contact with the buyer and tell him in more detail what else the online store can offer him.
• Instant refund. The client does not need to wait until the refund is initiated - it may take several days. Instant return of the payment amount to the card will significantly save time and allow you to continue shopping.
• Customer loyalty. Problems with the order - it is always unpleasant, especially when the money has already been withdrawn from the card. But if a customer is offered bonuses for waiting, alternatives or instant returns, he will feel an individual approach and either become a loyal customer himself, or else recommend an online store to his friends, since a high level of service today is a significant competitive advantage.

Thus, having avoided the return of funds, the online store will not only save profits, but also its image in the eyes of customers and partner banks. In the next, final part of “9 secrets of online payments” we will talk about how to set up a payment service specifically for your type of business. If you have any questions or you need to organize payment acceptance on the website / in the mobile application, please contact our specialists to consult you and select the appropriate payment solution.