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The madness of SaaS chargebacks

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Re: The madness of SaaS chargebacks

#61

Post by therealpygon »

sambroner wrote: post #28
amelius wrote: post #25

Earlier quoted context omitted.

What I don't understand is why my banking app does not show a "cancel subscription" button with the payment. When I click that button, the recurring payment is automatically canceled, and the SaaS company can check that and know that I unsubscribed. Or something along these lines. There is already a power-asymmetry between consumers and companies. This should not extend to unsubscribing. Here, the consumer should hav…

How would this be tooled? A chargeback, a deep link to the cancel page, an API connection between bank and subscription? Chargeback is easy because it's under the card co's control. Deep link would require knowing the cancel page of every sub, plus handling auth factors. API connection would two way integration, with scoped auth between every bank and every service. Hopefully managed by an SI or aggregator, but the b…

Considering they are placing the charges in the first place, it would seem like it would just need to be a response code, not a convoluted network of extensive new development like you suggest.

Re: The madness of SaaS chargebacks

#62

Post by darthShadow »

sambroner wrote: post #28
amelius wrote: post #25

Earlier quoted context omitted.

What I don't understand is why my banking app does not show a "cancel subscription" button with the payment. When I click that button, the recurring payment is automatically canceled, and the SaaS company can check that and know that I unsubscribed. Or something along these lines. There is already a power-asymmetry between consumers and companies. This should not extend to unsubscribing. Here, the consumer should hav…

How would this be tooled? A chargeback, a deep link to the cancel page, an API connection between bank and subscription? Chargeback is easy because it's under the card co's control. Deep link would require knowing the cancel page of every sub, plus handling auth factors. API connection would two way integration, with scoped auth between every bank and every service. Hopefully managed by an SI or aggregator, but the b…

Visa/MasterCard/Amex already support such a facility in India due to RBI requirements. Doesn't seem too difficult to adapt similar functionality for other countries too, if the regulations are updated to require it.

* https://www.visa.co.in/about-visa/newsroom/press-releases/vi... * https://pgi.billdesk.com/web/sihub

Re: The madness of SaaS chargebacks

#63

Post by ta1243 »

re-thc wrote: post #39
ilamont wrote: post #16

> What I don’t understand is why some people can’t just reach out and request it — instead of going straight to a chargeback. Customers don't want to "reach out" if it means hunting deep in their account settings to find the cancel button, or calling a number which may or may not lead them through an endless phone tree to waste 5 minutes talking with someone on the retention team reading from a script. People don't r…

> Customers don't want to {blah blah blah} If this is the way it works and the result are chargebacks it just means things cost more in general (cost of business will be factored in). It's not a good thing.

> the result are chargebacks it just means things cost more in general

shrug. That's just the way it works.

Make it easier to unsubscribe than doing a chargeback. Your competitors who do that will have a lower cost and be able to undercut you and you'll go out of business.

That is a good thing.

Re: The madness of SaaS chargebacks

#64

Post by ta1243 »

jddj wrote: post #22
mtmail wrote: post #9

We have very few chargebacks, not even 10 in 10 years and we consider us lucky. Stolen credit card happens more often than chargeback. I don't attribute it to better messaging or easier cancellation options, we do the same as many others, I guess it's just the type of product of customer. Even in HN comments I've seen people saying they use temporary card numbers (valid for one transaction only) or click a button to…

> They must've had bad experience with companies in the past? Ever used a gym, airline, or subscribed to a newspaper? Many businesses are genuinely customer-hostile.

Newspaper and gym, sure.

It's common enough that popular TV programs cover it

https://www.youtube.com/watch?v=oh8PFs0LTKc

Not sure about airlines though.

Re: The madness of SaaS chargebacks

#65

Post by ta1243 »

evermike wrote: post #50
miyuru wrote: post #45

I just created an account, and the subscription page in the app shows a $50 charge, while the public pricing page shows $10 with 'Minimum 5 seats' in small letters. Your post says about $10 charge, I am not sure how it happened with current flow. Be very direct about the pricing, and please use your own product so customers are not confused. https://beeimg.com/view/d3295639248/

I appreciate your attention. Let me explain. In the post I mentioned that we build several products. I didn’t want to list them all, because I always feel a bit awkward about self-promotion. My goal with the post was to spark a dialogue, not to advertise. RE pricing page: yes, we do state that there’s a minimum of 5 seats. But there are no chargebacks here, since we don’t take a card upfront and we don’t bill in a hi…

Let me explain, you are advertising something for $10 and selling it for $50.

No wonder you get unhappy customers.

Here are two fixes

> "From $50"

> "$10/user minimum 5 users" in the same font and size

Re: The madness of SaaS chargebacks

#66

Post by post_break »

mrtksn wrote: post #13

This is something good about the Apple AppStore, they handle the chargebacks and no ridiculous fees incurs(When a refund request is initiated, they will send you a consumption info request over API to ask for your opinion but ultimately its their decision and its handled by them). That's why I don't have a problem with Apple's cut as they handle something that's actually quite complicated and annoying. Their control…

You can't exactly charge back the AppStore because you risk losing your entire account. I'd much prefer every app be billed separately because then I CAN request a charge back, without fear of literally losing my entire phone, house access, etc.

Your definition of good, is my definition of a prison.

Re: The madness of SaaS chargebacks

#67

Post by arccy »

CamelCaseName wrote: post #37
jddj wrote: post #22

Earlier quoted context omitted.

> They must've had bad experience with companies in the past? Ever used a gym, airline, or subscribed to a newspaper? Many businesses are genuinely customer-hostile.

I actually find airlines very customer friendly. Depending on your country / ticket, you have a 24 hour cooling off period, easy to call phone numbers, self serve web platforms and apps, very well documented processes and procedures. Most of the worst airlines have some of these things, because if they didn't, they wouldn't be allowed to operate in certain regions (Canada/US, EU)

every time i have to book something in the UK / EU, I'm sad there's no 24hr cooloff unlike in the US.

Re: The madness of SaaS chargebacks

#68

Post by re-thc »

ta1243 wrote: post #63
re-thc wrote: post #39

Earlier quoted context omitted.

> Customers don't want to {blah blah blah} If this is the way it works and the result are chargebacks it just means things cost more in general (cost of business will be factored in). It's not a good thing.

> the result are chargebacks it just means things cost more in general shrug . That's just the way it works. Make it easier to unsubscribe than doing a chargeback. Your competitors who do that will have a lower cost and be able to undercut you and you'll go out of business. That is a good thing.

> Make it easier to unsubscribe than doing a chargeback. Your competitors who do that will have a lower cost and be able to undercut you and you'll go out of business.

How do you know people aren't already doing so? It's not about the competitors but the industry in general.

Have you not read the post I was replying to?

I quote:

> People don't remember they signed up.

> They can't remember how to log in from a different device to cancel.

> It's easier to use their credit card app to dispute the charge.

> The company name is different than the product name

> A worker or family member signed up using someone else's card

> People expected one thing from your SaaS product

> They rarely check or read their email

Sure there were other points, but more than 50% of the list is about the customer having their own problems. It's like having a bad actor in the system making it worse for everyone.

Re: The madness of SaaS chargebacks

#69

Post by marcosdumay »

sambroner wrote: post #28
amelius wrote: post #25

Earlier quoted context omitted.

What I don't understand is why my banking app does not show a "cancel subscription" button with the payment. When I click that button, the recurring payment is automatically canceled, and the SaaS company can check that and know that I unsubscribed. Or something along these lines. There is already a power-asymmetry between consumers and companies. This should not extend to unsubscribing. Here, the consumer should hav…

How would this be tooled? A chargeback, a deep link to the cancel page, an API connection between bank and subscription? Chargeback is easy because it's under the card co's control. Deep link would require knowing the cancel page of every sub, plus handling auth factors. API connection would two way integration, with scoped auth between every bank and every service. Hopefully managed by an SI or aggregator, but the b…

> Deep link would require knowing the cancel page of every sub, plus handling auth factors.

All it needs is a "payment refused, user canceled service" response to billing and not to flag the billing attempt as fraud.

Re: The madness of SaaS chargebacks

#70

Post by JumpCrisscross »

evermike wrote: post #47
infecto wrote: post #42

Earlier quoted context omitted.

If chargebacks are a significant issue for your business then you are doing something wrong.

As I mentioned in the article, this is extremely rare for us, but it has happened a couple of times. And that’s where I start having questions and frustration about the process itself. I’ve shared examples in the article.

> this is extremely rare for us, but it has happened a couple of times

Put punitive terms into your SLA. (Though check with a lawyer about adhering to your merchant agreement.)

Charging back doesn’t cancel a contract. If you want to be vindictive, you could sell the debt to a collector.

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