What is a chargeback?
Chargebacks happen when a fan disputes a charge with their bank or credit card company. There are many reasons a fan may decide to file a chargeback, but some common reasons include: not recognizing the charge, being unhappy with a product or service, or believing the transaction was fraudulent.
What happens when a chargeback is filed
When a chargeback is filed, the bank or credit card company preemptively refunds the fan while the bank begins a chargeback review. Chargeback reviews are entirely at the discretion of financial institutions and can take up to 75 days (sometimes longer) to resolve. After they complete their investigation, the bank or credit card company (not Passes) determines whether to keep the transaction reversed and side with the fan, or side with Passes and re-bill the fan. Funds for the chargeback are deducted from a creator’s balance while this review takes place.
Can chargebacks be prevented?
Chargebacks can’t be completely prevented, since under U.S. consumer laws customers always have the option to dispute a charge with their bank or credit card company; this is a process that businesses have no control over. Sometimes disputes happen even when the transaction is valid, such as if a fan doesn’t recognize the charge, forgets about the purchase, or is unhappy.
However, while no one can prevent chargebacks entirely, creators can reduce chargeback risks by keeping communication open with unhappy fans, responding to fans’ issues quickly, and offering fair solutions when something does go wrong. This helps turn frustrated fans into satisfied ones, which makes disputes a lot less likely to happen.
Additional steps creators and agencies can take to reduce chargeback risks are:
Set clear expectations upfront. Be very clear about what your fans are buying and when they can expect to get access to the purchased content or item. This includes describing membership perks and benefits in specific detail, so that there is no room for confusion and mismatched expectations. When fans know exactly what they’re getting (and when they’ll get it), they’re less likely to dispute the charge.
Deliver what you promised, on time. Late or missing content can be one of the biggest triggers for disputes. Communicating delays or updates helps keep fans satisfied and increases the chances of turning them into a repeat customer.
Respond to fans quickly. If a fan has a problem with their purchase, try to resolve it with your fan directly one on one, ideally in a private message. If you cannot reach a resolution, please have them contact our support team at help@passes.com and we can take a look.
Keep proof of delivery and communication. Save messages, receipts, and proof that the content or item was delivered. If a dispute happens in the future, this helps increase the chances of our automated counter-dispute program winning the chargeback on your behalf.
How does Passes handle chargebacks
We are excited to share that Passes’ automated chargeback dispute system is live and already hard at work! 🎉 This means that whenever a chargeback is filed, Passes automatically submits a counter-dispute on your behalf in order to give you the best possible chance of winning it. If we win, the funds will likely return back to your Passes account balance.
What does that mean for creators?
No extra work on your end
Faster action taken on chargebacks
A better shot at getting your money back
If the fan wins the chargeback, they get to keep their refund and the matter is considered closed. Please note that we cannot guarantee the outcome of chargeback reviews, as they are at the sole discretion of financial institutions, and Passes has zero say in how they are decided.