I just got a 'chargeback' email from regsoft, saying that the charge was refused by the customer?Anybody know what on earth this means? Sorry for the dumb question, but this has never happened before.
Thanks

The person who owns the credit card complained that s/he either did not make the purchase or somehow feels cheated by the purchase.

Especially with internet purchases, credit card holders pretty much always have the ability to say "I didn't do that" or "I don't want that". There is also, in general, no arbitration or anything involved in finding out if the person DID actually buy it - it's assumed that the CC number was stolen by a pirate and used without authorisation. (Which can, of course, be true.)

Unfortunately, the seller gets saddled with nasty charges in the case of a chargeback - and if they get more than a certain percentage of sales charged back, will generally be kicked out of any program. So it's something to be incredibly paranoid about when selling online. :)

Chargebacks are a larger problem in the porn business than elsewhere, though, for multiple reasons - a lot of porn sites use slightly dodgy tactics ("free trial" and then charging you $50 the minute after said trial expires, without asking) and a lot of people are embarassed about buying porn and later swear it wasn't really them who did that.

Outside of porn it's usually either a stolen CC number, a dispute about shipping, or a thief who's figured out that the rules are in the consumer's favor. (Or could be a kid took a parent's card without asking...)

Thats pretty grim, so theres really nothing I can do here? Luckily RegSoft absorb any charges, but I still lost a sale...

Originally posted by cliffski
Thats pretty grim, so theres really nothing I can do here? Luckily RegSoft absorb any charges, but I still lost a sale...

You can always dispute the chargeback if you are sure it was a legitimate purchase, but unfortunately the investigation fees charged by the credit card company would surpass what you stand to gain if you "win". And if you "lose", you are out the sale plus the investigation fee. So for all practical purposes, there is nothing you can do.

About the only thing you can do (if you really want) is try to implement ways of identifying this in the future. If you see the same person from the same IP address trying to use multiple card numbers, multiple names, or multiple addresses, you can always reject the order (or flag it and tell them the order requires manual verification or something). You just want to make sure you don't get too aggressive and reject legit customers (sometimes people honestly don't know their card is maxed out...I've had legit orders where the customer's first card failed but a different one worked)

This is a good reason to always return someone's money if they are demanding it, no matter what your refund policy is. The customer can go to their credit card company any time and get their money back. It's easier for you in the long run just to swallow your pride and make a refund rather than deal with a chargeback later.

Isn't there a certain percentage of assumed chargebacks that will result? I'd be curious to hear other publisher's / developer's experiences as to how often this happens. Is it a consistent rate that can be accounted for in a business plan?

From the sounds of it you're doing pretty well if this is your first chargeback.