Minimise revenue loss by following best practice guidance to prevent chargebacks.
A chargeback occurs when a customer disputes a transaction with their bank and gets the payment reversed.
Common reasons include:
- Seeing a duplicate or unexpected charge
- Suspecting unauthorised use of their card
- Not receiving their food or drink
- Not being satisfied with how an order issue was resolved
Why it is important to take action
Chargebacks directly impact your revenue. Once a chargeback is lodged, you lose the order payment, the cost of goods provided in the order, and may also incur a $25 chargeback administration fee applied by Stripe.
Worse, if your chargeback rate stays high, payment processors may impose restrictions on your account. This could prevent you from accepting online payments altogether.
Preventing chargebacks
While it’s impossible to avoid chargebacks entirely, following these best practices can significantly reduce the risk.
🧐 Be cautious
If an order feels too good to be true, trust your instincts. This could include orders that are larger than usual, or any kind of suspicious behaviour by the customer.
For any orders that don't feel quite right:
- Confirm the customer’s details before preparing the order.
- Use additional verification methods to ensure the transaction is legitimate.
✅ Verify customer identity
Establish a process to check customer ID, ensuring it matches the name on the order.
- Inform customer in advance if ID will be required at pick-up or delivery.
- If ID cannot be provided, consider cancelling the order to avoid potential chargebacks.
💳 Verify payment method used
Ensure the customer owns the card used for the payment. The Bopple Back Office ‘Orders’ area shows the card brand (e.g., Visa) and the last 4 digits of the card.
On request, legitimate customers should be able to present:
- The card in their Apple or Google Wallet showing the brand and last 4 digits, or
- The physical card
🤓 Train your team
Equip your team to follow these steps consistently:
- Recognise triggers for additional checks (eg. high order value)
- Communicate with customers about verification requirements
- Handle scenarios where customers cannot or refuse to verify
Example script for notifying customers
How you might like to communicate with customers when you required additional verification on an order. Just a guide, so feel free to add your own touch.
Hi [Customer Name], this is
[Your Name]from[Store Name]. Thanks so much for placing an order with us!As part of our process, we’ll need to see some ID and proof of the payment method you used when your order is
[picked up / delivered].This helps protect our customers and our business from fraud and unauthorised transactions. It might seem like an extra step, but it's there to ensure everything is safe and above board, so we hope that's ok.
We'll have your order ready soon!