If you've ever experienced a fraudulent chargeback on your store, then you know how frustrating
it can be.
This video covers one way you can help protect your business from fraudulent chargebacks.
First, what is a fraudulent chargeback?
A chargeback is the return of funds from your store to a customer.
Chargebacks happen when a customer disputes a credit card charge.
The bank that issued your customer’s credit card can take the purchase amount from you
and refund it to the credit card holder.
When the chargeback is requested for a fraud-related reason, this is called a chargeback due to
fraud or a fraudulent chargeback.
For example, a customer may request a fraudulent chargeback if their credit card was stolen
and used to place an order through your store without their permission.
If your store accepts credit cards, then you will likely need to deal with chargebacks.
If a chargeback isn't resolved, then you might lose the product, the purchase amount, and
pay a chargeback fee.
See the link in the description to learn more about chargebacks.
Shopify’s fraud analysis appears on each order placed through your online store and
can help you make informed choices about the risk of fraudulent chargebacks.
For an added layer of protection, eligible businesses can also activate Fraud Protect
for Shopify Payments.
Fraud Protect for Shopify Payments literally protects you against fraudulent chargebacks.
This makes it easier for you to confidently fulfill orders.
After Fraud Protect is activated, online orders processed through Shopify Payments are automatically
analyzed and labelled as "protected", or "not protected".
You pay a small fee on each protected order, and Shopify guarantees the payment.
You don't have to do anything if there’s a fraudulent chargeback on a protected order
- Shopify automatically reimburses you the full chargeback amount and you don’t have
to deal with the chargeback dispute.
Only businesses that meet certain criteria are eligible for Fraud Protect.
For example, your business must be based in the United States and must use Shopify Payments.
If you see a Fraud Protect for Shopify Payments section on the Payment providers page in your
settings, then you are eligible for Fraud Protect.
To activate Fraud Protect, log in to your Shopify admin as the account owner and click
Settings.
Click Payment providers.
On the new page, scroll to Fraud Protect for Shopify Payments.
If you don’t see this section, then your store isn’t eligible for Fraud Protect.
If your business does become eligible for Fraud Protect in the future, you will see
a notification in your store admin.
If you do see this section, then click Set up Fraud Protect.
Read the terms of service, including the fee that you’ll pay on each protected order.
If you want to continue, click Accept Terms.
Next, choose how you want to capture payments for orders that aren’t covered by Fraud
Protect.
Fraud Protect covers nearly all of your orders paid with a credit card through Shopify Payments.
For orders that are not protected, it’s recommended that you review the order and
capture payment manually if you decide to fulfill the order.
Choose Manually capture payment after reviewing for this option.
Otherwise, if you select Automatically capture payment, any orders that are not protected
with Fraud Protect still captures payment without the opportunity to review the order
and Fraud Analysis.
Choose which option you prefer and click Activate Fraud Protect.
Click Done to close the window.
After Fraud Protect is activated, any new, eligible orders are protected.
You can change the settings for payment capture or deactivate Fraud Protect at any time.
Open the Payment providers page, and scroll to Fraud Protect for Shopify Payments.
From here, make any changes to how you’d like to capture payments, and click Save.
To deactivate, click Deactivate Fraud Protect and read through the information provided.
Click Confirm Deactivation.
Select a reason why you’ve removed the feature and click Submit.
All protected orders placed while Fraud Protect was active continue to be protected even after
you deactivate Fraud Protect.
Subscribe now to watch the next video about fulfilling orders using Fraud Protect.
If you still have questions, comment below or contact the Shopify support team directly.