Most merchants know about chargebacks on the Internet and try to find good chargeback protection, but this does not prevent fraudsters from finding new ways to steal and deceive victims. Fortunately, the cancellation of payment is a complex process, and you can protect yourself, and the chargeback protection can help you with this.

What are chargebacks? A chargeback is a cancellation of a transaction initiated by a customer's bank when the customer requests the money back for the purchase. It is intended as a mechanism to protect consumers' eWallet or a payment system online account from fraudulent activities carried out by illegal companies or individuals.

What are the reasons for a chargeback?

For the most part, chargebacks are legitimate complaints from your client, but there are times when chargeback protection can play a role:
● As for the claim that the item was never delivered or received, your customers may have their own expectations about when the item will be received.

● Customers may see a double charge on their banking online account statement for the same item/transaction, but they may have accidentally purchased the item twice.

● A customer may see a charge on their credit card statement for a purchase they never made or for a transaction that was not from the merchant they purchased the item from.

● Your customer receives a product that they believe does not match what they originally intended to purchase.
● In terms of fraud claims, a customer might say they were the victim of identity theft and never made a purchase.

Protect your business from fraud: Chargeback protection of payment systems can prevent fraudulent transactions during electronic transactions. It should be noted that chargeback protection is a monitoring system, like Ethoca, that checks each transaction on the online account in real-time according to certain criteria. If a transaction does not pass the test for at least one filter, the system can reject the payment.

Most online services and online stores use third-party services, such as Maxpay (https://maxpay.com/), to accept payments that already have similar chargeback protection systems.

Chargeback protection work: Consider how this works, for example, Maxpay. This chargeback protection which works in the SEPA region, contains a lot of different filters, which are selected depending on the field of business. The parameters by which each payment is analyzed may include:

● the amount and currency of payment, such as for stores in Europe it is USD, EUR, and other currencies in the SEPA region;
● date and time of payment;
● unique bank card tokens;
● IP address and MAC address of the device used for payment;
● history and frequency of purchases;
● 3D Secure security protocol eWallet support;
● history of failures and successful prepayments, etc.

When it comes to the security of e-commerce, the goal № 1 for all online merchants is to ensure the secure storage, processing, and transmission of payment data of their customers. Whether you are working with a third-party vendor, Maxpay or Ethoca, relying on your own, or a combination of both, your security system must work effectively at all of these levels.