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Stripe Chargeback Protection

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Re: Stripe Chargeback Protection

#91

Post by globile »

patio11 wrote: post #80
PatrolX wrote: post #77

Earlier quoted context omitted.

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…

Isn't this what Ethoca and Verifi do?

Re: Stripe Chargeback Protection

#92

Post by Liron »

tacosx wrote: post #37

The chargeback is one of the few tools consumers still have with real power. Sure fraud is still a problem, but it's a really uncomfortable proposition to start making chargebacks an abstracted cost sink for the corporations. Of course the fact that this is an upsell line item means only big businesses will pay for it, the smallest businesses owned by the people just starting out will be the only ones who actually su…

But this product isn't taking away consumer protection via chargebacks, nor hurting small businesses in any way.

Re: Stripe Chargeback Protection

#93

Post by curiousgeorgio »

jasonkester wrote: post #10

But this isn't the product I want. I don't want to ever fight chargebacks. Because my policy is to never take money from people who don't want to give it to me. I want to automatically refund every chargeback attempt without it affecting my ability to charge credit cards. One of my businesses targets consumers, who have this amazing ability to "forget to cancel" or to have "cancelled 3 months ago, but for some reason…

> We'll happily refund every penny you ever paid us if you simply ask.

I'm all for giving customers the benefit of the doubt (and I'm definitely generous in giving refunds too), but doesn't this policy go a bit too far? Even if your costs are near zero, I find it somewhat unethical to say "yes, I have proof that you used my service and received the value I promised to provide... and yet the contract of the sale (implied or explicit) - past or present - is effectively nullified at your request at any time".

While it often doesn't make sense to chase after money from customers who make these kinds of requests, it also feels wrong (to me) to encourage that kind of consumer behavior. The retroactive part seems especially ripe for abuse from customers who decide to switch to a competitor, making their switching cost effectively negative (they're incentivized to leave you).

Yes - on the whole, people are usually honest and respectable. But in my experience, a surprising number of those same people value saving a few bucks over a clean conscience.

Re: Stripe Chargeback Protection

#94

Post by jopsen »

jasonkester wrote: post #10

But this isn't the product I want. I don't want to ever fight chargebacks. Because my policy is to never take money from people who don't want to give it to me. I want to automatically refund every chargeback attempt without it affecting my ability to charge credit cards. One of my businesses targets consumers, who have this amazing ability to "forget to cancel" or to have "cancelled 3 months ago, but for some reason…

Let's assume you're running a scam (thought experiment). If it was possible to refund anybody who complained and not have the complaint affect your ability to charge credit cards, then wouldn't every scammer do this?

I think it's fair to assume that few people will notice a fraudulent charge, and much less bother to dispute it.

If you charge money you don't feel like you need to charge -- then simply don't charge it :)

For a subscription simply ask inactive users to sign-in and confirm that they wish to maintain their subscription.

Re: Stripe Chargeback Protection

#95

Post by globile »

Things like this are great for the average to small merchant, BUT if you're processing more than, say, 50,000 USD a month, relying heavily on the Stripe ecosystem can take its toll and can cost you big time.

- Use Stripe as the only gateway for all your international traffic, and you will see alarming drops in acceptance rates, meaning the chance of successfully charging a Mexican customer in Mexico with a US Stripe account is much lower than if you have a local acquirer. By a lot!

- Rely heavily and blindly on Stripe Radar for post-charge suspected fraud alerts charges, and you will be refunding many valid orders.

- If you go all in with Stripe Checkout, you are getting a lot of good stuff at a price. If stripe dynamically uses 3DS to sift potential fraud users, you are going to hurt your conversion rates.

Been a big fan of Stripe for a long time, but when order volume goes up, and you grow internationally you have to consider other alternatives and/or backup plans, such as smart routing, local merchants, alert networks (ethoca, verifi), pre-checking for pseudo 3DS charges (no auth need, but fully protected, etc)

Not taking into account these 3 things, can drop your conversions by big double digit percentages.

EDIT: spelling

Re: Stripe Chargeback Protection

#96

Post by Filippoi »

eeke wrote: post #24
jasonkester wrote: post #10

But this isn't the product I want. I don't want to ever fight chargebacks. Because my policy is to never take money from people who don't want to give it to me. I want to automatically refund every chargeback attempt without it affecting my ability to charge credit cards. One of my businesses targets consumers, who have this amazing ability to "forget to cancel" or to have "cancelled 3 months ago, but for some reason…

We can send you a webhook on every dispute being created ( https://stripe.com/docs/webhooks ) and you could use the API to either refund the underlying charge or accept the dispute (and refund the underlying charge). We can also give you access to receiving early fraud warnings from issuers (like Visa TC40s). These are notifications from the issuers that the customer is likely going to dispute a charge. If you're hap…

> We can send you a webhook on every dispute being created (https://stripe.com/docs/webhooks) and you could use the API to either refund the underlying charge or accept the dispute (and refund the underlying charge).

Unfortunately, I don't think that's possible.

On Stripe, attempting to refund an actually disputed charge results in an error / invalid request.

https://stripe.com/docs/error-codes#charge-disputed

It does work for inquiries but I am not sure how often those happen vs. "proper" declines/chargebacks. I'd assume the majority is of the latter type.

Re: Stripe Chargeback Protection

#97

Post by jasonkester »

ensignavenger wrote: post #83
jasonkester wrote: post #46

Earlier quoted context omitted.

Here's one of those invoice mails in its entirety. Sent from (and reply-to) info@twiddla.com. See if you can figure out how to go about cancelling your subscription or getting a refund: Your Twiddla Bill for April 4, 2019 to May 4, 2019 Hey, we wanted to let you know that on May 4, 2019 we charged your credit card $14.00 for your monthly Twiddla Pro subscription. You can find additional information regarding your bil…

I have no desire to yell at you, simply to cancel the account and request a refund. While sending an email is okay, it would be better if there was a link directly to a page to do so, just like unsubscribing from an email list. Regardless, I would recommend changing the wording from "yell" because that sounds hostile, and most people don't want the conflict.

One nice thing about running your own business is that you can develop your own "voice" throughout the copy on your site and in your communication with users. And that that voice need not be soulless nor corporate nor cleared by Legal.

Plenty of people have taken me up on the offer for a refund, and none of them felt the need to "yell", so I think they got the correct vibe. All our site copy and mails have this same casual, friendly tone. People seem to like it.

Re: Stripe Chargeback Protection

#98

Post by HatchedLake721 »

hedora wrote: post #82
eeke wrote: post #8

I’m the PM on Chargeback Protection. Startups told us they don’t want to deal with the hassle and unpredictability of chargebacks; that’s why we built this. Happy to answer any questions you have.

As an end user, how can I tell the modal dialog is actually my bank? It looks trivial for the vendor to man in the middle attack. I’d take my business elsewhere if presented with a UI from some random e-commerce site asking for extra personal information.

3D secure payments in Europe have been a standard for years - being presented with additional verification steps for online purchases.

Attacker cannot know who you bank with. Plus, most of the time the confirmation screens are something like confirming 2nd/Xth characters of your password/date of birth.

Re: Stripe Chargeback Protection

#99

Post by luka-birsa »

ddebernardy wrote: post #57
ysavir wrote: post #25

Earlier quoted context omitted.

Stripe can do refunds through their API, so there's nothing stopping you from building this feature into your own business, on your own site, with your own branding and wording, etc. I would look at Steam's refund flow for inspiration.

That's different from what OP's point is. Dealing with refund requests is easy. The problem is customers who request chargebacks from their banks instead of requesting refunds from you. Payment providers usually contest such chargebacks automatically. This ends up costing you a fee. And if you lose the dispute, or issue a refund as a matter of course, these chargebacks contribute to lowering your account's reputation…

Ideal for a company that has near infinite markup on the goods (eg. SaaS business with very good unit economics). As somebody that processes a lot of payments for physical goods (electronic devices) the preference is not as clear cut. You ship out the goods in the COGS value of couple K of USD just to get the chargeback.

We've ended up adding additional heuristics to mark the fishy payments and manual checking before shipping out.

Something like Stripe Chargeback protection actually makes sense and I'll ask my team to look into the ratio of chargebacks to see if it makes sense to migrate from Braintree just because of this.

Re: Stripe Chargeback Protection

#100

Post by jtbayly »

dthedev wrote: post #56
zenexer wrote: post #50

Earlier quoted context omitted.

That’s pretty cool. Is this something Stripe customers have to pay an additional fee to access, or is it included? Another question: what’s the percentage of false negatives?

It says on the page, the service costs 0.4% per transaction.

That's for the service in the original link. Not sure that's the same for the potential service under discussion here.
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