How to Avoid Chargebacks

Retailers are looking for reasonable EMV solutions that address costly chargebacks due to fraud.

July 12, 2021

EMV Chip

ALEXANDRIA, Va.—Convenience retailers are now fully liable for any fraudulent charges made at non-compliant outdoor payment terminals, and those who have not yet upgraded to outdoor EMV will be required to repay those charges to the credit card networks.

Implementing an EMV solution does not create a fail-safe for retailers to avoid chargebacks. Although the EMV liability shift date has passed, retailers who have not converted to outdoor EMV and are met with fraud are likely to be dealing with chargebacks to cover the liability of fraudulent charges.

Many large outdoor EMV solution providers offer new pump and retrofit solutions. An upcoming Conexxus webinar, “EMV Solutions Overview: Chargebacks Are Here; Know Your Options to Become Compliant,” on Thursday, July 15 will focus on some of the EMV solutions that retailers may be less familiar with.

This webinar is free to attend. To register, sign up for a free or full content subscription to Conexxus365, then use the register link to sign up for the live webinar.

History of Chargebacks

In October 2015, changes in payment network rules took effect to support the migration to EMV by placing liability for fraudulent transactions with retailers who had not successfully transitioned to EMV chip technology. (U.S. Payments Forum)

There are four categories for why chargebacks occur (Chargebacks 101: The Basics):

  • Fraud: Fraudulent chargebacks occur when a counterfeit or lost/stolen card is used to pay for goods or services.
  • Authorization: The user’s card cannot be electronically approved.
  • Processing errors: Outdate POS software, for example
  • Customer disputes: Cardholders chargeback a transaction if the goods or services are damaged or defective, not as described, not received, or the merchant name isn’t recognized.
Earlier this year Conexxus released a white paper, “Resources and Guidance for EMV Implementation in a C-Store Environment.” The resource brings together educational information, frequently asked questions and links to resources for convenience retailers on EMV implementation.