Chargebacks - A cost of doing business? Not if you do it smart.
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A Chargeback is an automatic retrieval of funds that happens between the banks of the seller and the buyer. Nothing is required from the buyer to make the claim apart from his own word. No agreement from the seller (MC’s billing system in this case) is required. All a seller can do is start a legal procedure against the buyer once he/she finds out about the chargeback if he/she feels it was fraudulent.
Chargebacks are often called “a cost of doing business”. And – to some extent – that’s true.
Unfortunately for us, chargebacks are more frequent where the card or card holder are not present at the point of sale – online purchases.
That’s why it’s better to learn how to avoid chargebacks - forewarned is forearmed.
We’ve found a very useful thread on xbiz.net – the industry hub, and would recommend you to check it here.
A couple of “rules of thumbs” against chargebacks are:
1. Make it easy for the member to contact you for the times they decide to cancel or seek a refund.
2. Make sure that the member knows what he’s getting, give clear information on what the member is paying for on your join page.
Sometimes users cancel or even charge back their subscriptions because they just don’t see any updates on the website (especially if your join page promises “new videos every day!”). Make sure that your offer is reflected on your site, otherwise your fans will feel cheated. If you engage your members, get them to communicate, comment, log on often to check for updates and just outright give them reasons to stay – they will do just that. Stay connected with your members, inform them about future events and make them feel as part of your life and you will keep them longer and keep them paying. This could be as easy as a short welcome message from you upon signup.
Although chargebacks are rare at ModelCentro, even a small loss in addition to amount’s reversal can hurt a small business, operating on a slim profit margin. That is why ModelCentro will cover chargeback fines imposed by the bank on the account where the chargeback occurred.
We want your business to be successful and your fans to be satisfied, that’s why MC has the following chargeback coverage policy:
1. We will cover chargebacks if the cause of the chargeback is a technical problem, which is our responsibility;
2. We will of course review every single chargeback and make an individual decision on each. If we believe we are able to get the money back, we will consider covering the chargeback to the model in full or in part;
3. We will cover chargebacks of only registered members, free members’ chargebacks (i.e. Tips without registration) will not be covered. That is due to the fact that we have no evidence of user activity if he/she is a free member.
In any case, ModelCentro is interested in keeping you satisfied, so we are going to try and fight against each chargeback with the help of a dedicated company which handles such situations, and any saved amount will be added back to your account.
Have you ever had experiences with chargebacks? Please share and as always - we greatly appreciate all feedback! 
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