Chargeback guarantee fraud protection: a complete guide

The painful truth is that ecommerce merchants need a chargeback guarantee more than ever.

A chargeback in online retail amounts to an un-conversion. A transaction that was a sale suddenly isn’t anymore. Not only that, but a chargeback transforms a money-making event into a cost to the business. It’s no wonder then that merchants are constantly looking for the best way to avoid chargebacks — and when that isn’t possible the best way to eliminate the cost of chargebacks to the business.

In 2023, the surest way to accomplish both of those things is through fraud protection for merchants that offers a chargeback guarantee.

What is a chargeback guarantee?

A chargeback guarantee is a contractual promise from a fraud protection vendor that it will reimburse a merchant for an approved order that turns out to be fraudulent. One important factor to note is that different fraud protection providers add different conditions to their chargeback guarantees, which in some cases limit the protection a merchant enjoys with a given provider.

And many providers don’t offer a guarantee at all.

To better understand the concept of a chargeback guarantee, it’s important to understand what a chargeback is and how they originate. The most commonly discussed chargebacks occur when an unauthorized charge is made on a consumer’s credit card. Such charges are generally the result of criminal activity. Fraud rings, for instance, use stolen credentials available for purchase on the Dark Web to make online purchases for which they’ll never be billed.

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