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Stripe Chargeback Protection

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Re: Stripe Chargeback Protection

#71

Post by rattray »

jasonkester wrote: post #40
peteretep wrote: post #32

Earlier quoted context omitted.

> to have "cancelled 3 months ago, but for some reason we're still billing them" or to just plain decide that the last six months of charges were fraudulent I've had both of these things happen as a consumer. Coschedule kept billing me for six months after I cancelled (and my accounts administrator didn't know we'd cancelled), and I had Experian in the UK continue billing me for six months after they'd disabled my ac…

I do have the occasional customer claim to have "cancelled 3 months ago" via email. We keep good records of such things, so we know him to be mistaken but I always make a point of apologizing and issuing an immediate refund. I word my "Why did you open a chargeback" mails the same way, and offer to handle things via a refund (and to please close the dispute because it affects our business). But the people who use the…

Perhaps the ethical thing to do in those situations is to fight the dispute? Acquiescing encourages bad actors.

Your current course of action is probably still best for your business and sanity, though. Hmm...

I assume you send an invoice/receipt email every month by default, to reduce the chance that a user forgot to cancel and to make it easier for those that wish to. (If not, I think Stripe Billing offers this, though I'm not sure...)

(disclaimer, I work at Stripe, though not on Radar or Billing, thoughts my own, etc)

Re: Stripe Chargeback Protection

#72

Post by fyfy18 »

judge2020 wrote: post #68
kmfrk wrote: post #59

It'd be great to see Stripe adopted by donation platforms for livestreaming like Streamlabs and StreamElements, chargebacks remain an awful abuse vector there.

Didn't Paypal add a TOS clause (or something along those lines) that prevented donations from being valid for chargeback?

How does that even work? The chargeback is initiated and the fee levied by the card issuer (Visa, MasterCard, etc).

Re: Stripe Chargeback Protection

#73

Post by michaelmior »

michaelt wrote: post #62
eeke wrote: post #44

Earlier quoted context omitted.

Card issuers are often able to detect that a transaction is fraudulent before it is disputed, and when this happens, they will send us a notification. These notifications are commonly called TC40s (Visa) or SAFE reports (MasterCard). On average ~60% of early fraud warnings end up being disputed, and most disputes have an early fraud warning (though there’s a wide range depending on your business). If you refund these…

Card issuers are often able to detect that a transaction is fraudulent before it is disputed, and when this happens, they will send us a notification. Is there a mechanism like that but in the reverse direction? i.e. if a seller detects someone testing stolen cards, and wants to alert the card issuer all those cards are stolen?

Shouldn't the issuer be able to figure this out on their own when they see the attempted charges coming in? It seems like the resources of the issuer would be better spent improving their own detection rather than dealing with third-party reports.

Re: Stripe Chargeback Protection

#74

Post by kmfrk »

judge2020 wrote: post #68
kmfrk wrote: post #59

It'd be great to see Stripe adopted by donation platforms for livestreaming like Streamlabs and StreamElements, chargebacks remain an awful abuse vector there.

Didn't Paypal add a TOS clause (or something along those lines) that prevented donations from being valid for chargeback?

PayPal ran into some bad PR a while ago with people making "fake" donations to the tune of thousands of dollars and ended up refusing the chargebacks. But as far as structural change, things are still pretty bad.

Streamlabs's tutorial on chargebacks was updated as recently as a month ago: https://support.streamlabs.com/hc/en-us/articles/11500601766....

Re: Stripe Chargeback Protection

#75

Post by andrewbarba »

This appears to require the new Checkout product in order to enable it. What happens if we have a percentage of sales coming from a native iOS or Android app? Are we not allowed to enable protection? Or would just the web transactions be covered?

Re: Stripe Chargeback Protection

#76

Post by smoovb »

Does this mean Stripe will change its allowed merchants? We sell digital telecom products and Stripe does not accept our business. This would be a product we could use, but can't if they are still rigid about their accepted business.

Re: Stripe Chargeback Protection

#77

Post by PatrolX »

eeke wrote: post #44
jasonkester wrote: post #31

Earlier quoted context omitted.

How does that work? When I'm notified of a dispute, the first thing I do is go in and refund the charge. I still have to watch the whole dispute resolution process play out and have it be ruled against me. How would I go about stopping it before it starts, as you seem to imply is possible? Edit to add: Does it even make a difference if I go in and refund the disputed payments? It sounds like I get dinged either way a…

Card issuers are often able to detect that a transaction is fraudulent before it is disputed, and when this happens, they will send us a notification. These notifications are commonly called TC40s (Visa) or SAFE reports (MasterCard). On average ~60% of early fraud warnings end up being disputed, and most disputes have an early fraud warning (though there’s a wide range depending on your business). If you refund these…

But wait, what about Stripe Radar?

If card issuers are "often able to detect that a transaction is fraudulent before it is disputed" (presumably because of transaction history) then why can't Radar block the transaction from ever taking place? Maybe there's more to it than transaction history? Can you clarify?

Re: Stripe Chargeback Protection

#78

Post by awinder »

GarrisonPrime wrote: post #69
awinder wrote: post #52

Earlier quoted context omitted.

Regardless of the ethics of this approach (I don't even want to touch that part), continuously charging back has a number of ways that can ultimately hurt you: 1. If you run this scheme enough and your credit card company flags your account for excessive chargebacks, you could very well have that card shut down and take a credit hit along with it. 2. More and more companies implement against (effectively) data broker…

Few consumers are going to be aware of such potential drawbacks, and those who are will generally risk it anyway. I think you underestimate people’s eagerness to trigger a system that makes them feel powerful and righteous.

Oh I am fully aware of people’s eagerness, which is why I’m not even going to start with the parent poster. I’m here for anyone else who comes by who innocently thinks that might be good advice ;-)

Re: Stripe Chargeback Protection

#80

Post by patio11 »

PatrolX wrote: post #77
eeke wrote: post #44

Earlier quoted context omitted.

Card issuers are often able to detect that a transaction is fraudulent before it is disputed, and when this happens, they will send us a notification. These notifications are commonly called TC40s (Visa) or SAFE reports (MasterCard). On average ~60% of early fraud warnings end up being disputed, and most disputes have an early fraud warning (though there’s a wide range depending on your business). If you refund these…

But wait, what about Stripe Radar? If card issuers are "often able to detect that a transaction is fraudulent before it is disputed" (presumably because of transaction history) then why can't Radar block the transaction from ever taking place? Maybe there's more to it than transaction history? Can you clarify?

Here's a stylized example which may help:

Monday: credit card does a transaction at a particular business.

Thursday: user calls bank to report card stolen as of previous Sunday. This kicks off a TC40 on all transactions on or after Sunday.

Friday: bank staff and/or user walk through the transactions which were post-theft, figure out which ones were still authorized (e.g. the recurring Netflix bill), and file disputes on all the other ones.

Since there is no way to send the TC40 back in time to Monday, it can't influence the fraud scoring run at the time of the transaction. But there is, in this stylized example, a window between the TC40 and the dispute for the business to proactively investigate and possibly refund.

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