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This article is the third in a series on Ethoca and Verifi. If you want relevant background from the first two articles, read Ethoca Alerts: Mastercard’s Answer to Verifi RDR and What is Verifi RDR (Rapid Dispute Resolution).
If you’re a merchant reading this blog, you’re likely someone seeking solutions to chargeback problems.
I have a recommendation: Sign up for real-time pre-chargeback alerts.
Receiving pre-chargeback alerts allow you to refund a payment before it turns into a chargeback. Every alert is a chargeback avoided with a refund.
But how best to get these alerts?
You have two choices:
- Apply directly to Ethoca and Verifi and set them up manually yourself.
- Hire a dedicated chargeback prevention service that acts as an automated mediator between Ethoca, Verifi, and your company.
There are supporting arguments for both options.
We at ChargebackStop recommend automating the process as in Option 2. However, your situation may best be solved with Option 1—doing it manually—especially if you are a very large merchant.
Let’s discuss why you might choose one option over the other.
We’ll also see how to sign up for alerts for the option you choose, direct or ChargebackStop.
Finally, we’ll provide contact information for both options.
Let’s begin.
Why Apply Directly? (Option 1)
Very large merchants, especially, may prefer Option 1. These businesses have the resources and staff to lower alert costs and control the integration of alerts into their infrastructure.
The direct do-it-yourself option also has these benefits:
Customisation
Handling these systems directly can provide more flexibility to customise the response strategies and rules specific to your business needs.
Potential Cost Savings
Big businesses may have existing relationships with Visa and Mastercard. These high-volume transaction merchants may wish to use their size to reduce their per-transaction fees.
Real-Time Integration
Direct application allows for potentially smoother and faster integration with your existing systems, giving their own automated systems real-time data and responses. This enables customised near-real-time reporting and actions.
Learning and Development
Direct involvement with these tools can enhance your team's skills and understanding of fraud prevention, contributing to better long-term security practices. This applies directly to technical and programming staff.
The Downsides of Applying Directly
We must also look at the downsides of applying directly to Ethoca Alerts and Verifi RDR instead of choosing a third-party service.
In assessing the downsides of applying directly, note the resources required and the scalability factor. These can be difficult to handle for startups and small to medium-sized businesses. Problems increase as the company grows or scales massively.
Resource Intensive
Managing these systems in-house requires significant resources, including staff time and expertise, which might be scarce in smaller or leaner operations.
Complex Setup and Maintenance
These systems’ setup, integration, and ongoing maintenance can be complex and demanding. A thorough understanding of the technology and the related financial processes, such as specialised chargeback prevention procedures, is necessary.
Higher Initial Costs
There may be higher upfront costs involved in setting up custom automation and training staff, as well as potential investments in the software required to integrate these alert systems.
Slower Response Times
Without the specialised tools and expertise that a third-party service offers, your response times to alerts may be slower, increasing the risk of chargebacks. As your business scales, this slowdown becomes significant and can lead to bottlenecks.
Learning Curve
There is a significant learning curve associated with using these systems effectively. Mistakes made due to a lack of expertise and experience can be costly.
Lack of Advanced Analytics
Third-party services often provide advanced, specialised analytics and reporting that can be crucial for understanding chargeback trends and refining strategies. Doing it in-house might not yield the same depth of insights.
Scalability Issues
As your business grows, scaling your in-house operations to efficiently manage an increasing volume of alerts can be quite challenging without external knowledgeable help.
How to Enroll with Ethoca and Verifi
If Option 1—direct enrollment—suits your business model, here’s what you need to know to apply directly to Ethoca Alerts.
Verifi enrollment is described in the next section.
Enrolling in Ethoca
Ethoca can be reached through their online contact form. Speak with their representative and get a free chargeback assessment.
Using Ethoca
When using Ethoca, you’ll need to collect some information and take specific actions. Each alert is handled individually (automation not provided).
Collect:
- Your customers’ billing descriptors (the information appearing in their statements).
- The last four digits of the cardholder’s card.
- Transaction amount, currency, and date.
- Customer’s email address and phone number.
- Shipping address if applicable.
- Details about the purchased product or service.
- IP address from which the transaction was made.
Action:
- Use the information in the alert to match the payment in your payment service provider (such as Stripe).
- Confirm the match by cross-referencing transaction IDs or other unique identifiers.
- Investigate any discrepancies between the alert details and your transaction records.
- Reach out to the customer to verify transaction details or clarify any confusion.
- Decide on the appropriate action based on the alert, such as issuing a refund or cancelling the transaction to prevent a chargeback.
- Update your records to reflect any actions taken in response to the alert.
- Follow up with the issuing bank or card network if further information or action is required to resolve the alert.
Enrolling with Verifi directly
If you wish to enrol in Verifi directly, you can use their contact form or online chatbot to reach their sales team.
- Schedule a consultation call or meeting with a Verifi representative to discuss your business needs, your challenges with chargebacks and fraud, and how Verifi’s RDR services can address these issues.
- You will receive a detailed proposal from Verifi outlining the services they offer, the costs involved, and the terms of the agreement.
- Review and negotiate the terms as necessary.
- Check the costs and benefits of a third-party chargeback prevention service before signing the agreement.
- Choose the option which best suits your business goals and increases ROI.
Using Verifi RDR
Collect this information from your payment service provider:
- Your Merchant Category Code (MCC)
- Your CAID (Cardholder Account Identification, which the merchant’s acquiring bank generates).
- Your Visa BIN (Bank Identification Number).
RDR Rules
Merchant Enrollment
Merchants must opt into the RDR program through their acquirer or directly through Visa, agreeing to the terms of service, which outline the use of the system and associated fees.
Setting Rules
Merchants define rules that determine how disputes will be resolved automatically. These rules can be based on transaction amount, type, and other criteria relevant to the merchant’s business.
Automated Resolution
Once rules are set, RDR automatically resolves disputes in real time based on the criteria established by the merchant. If a dispute meets the criteria for automatic resolution, the system processes the resolution accordingly, either accepting or declining the dispute on the merchant’s behalf.
Fee Structure
Participating in RDR may involve specific fees, including per-transaction fees for resolved disputes. These fees can vary based on the merchant's agreement with Visa or their acquirer.
Reporting and Monitoring
Merchants receive reports and alerts related to RDR activities, allowing them to monitor the outcomes and adjust their rules if necessary.
Flexibility in Adjustment
Merchants have the flexibility to update or change their resolution criteria based on evolving needs, transaction patterns, or outcomes observed from the dispute resolutions.
Why Choose a Dedicated Chargeback Prevention Service? (Option 2)
You probably think, “Option 1 looks like a lot of work!”
You’d be right.
When considering whether to use a dedicated chargeback prevention service like ChargebackStop, there are three fundamental factors to take into account:
Cost
As a reseller with a substantial account, we can typically obtain lower prices than buying directly. This applies primarily to small and medium-sized businesses, but big companies may also see price reductions through us.
Integration
Ethoca and Verifi do not provide ready-to-use integration or automation. With Ethoca alerts, you’ll need to set up the system and match transactions on your own without expert help.
Choosing the direct route requires either dedicating staff hours to operating the tool or developing in-house automation, both of which come at a higher cost than using our pre-built integrations and automation workflows.
Support
Ethoca and Verifi systems are not entirely accurate and can occasionally generate mismatched alerts, duplicates, or invalid data. In all these cases, additional resources would be needed to identify and flag these instances, whether through personnel or technology. Even big businesses have to deal with this issue.
Extra Benefits with Chargeback Prevention
In addition, there are extra benefits to using a prevention service such as ChargebackStop.com.
Expertise
Our purpose is to specialise in chargeback prevention and dispute resolution, bringing extensive knowledge and experience that can help optimise your approach and provide exceptional support.
Efficiency
We handle the setup, maintenance, and day-to-day management of alerts, saving you time and allowing you to focus on other aspects of your business.
Improved Success Rates
With our expertise, we successfully prevent 99% of chargebacks and in helping you win disputes.
Cost-Effectiveness
Outsourcing can be more cost-effective than building and maintaining an in-house team, especially for smaller and medium-sized businesses.
Access to Advanced Tools
ChargebackStop uses advanced technologies and automated tools to detect and respond to fraudulent activities effectively and efficiently.
Scalability
We scale our services according to your business needs, accommodating growth or changes in transaction volumes without additional internal resources.
Comprehensive Reporting
ChargebackStop provides detailed reporting and analytics, which can help you understand trends in disputes and chargebacks, improving your overall fraud management strategies.
Plus, we have excellent customer support:
- We set up a shared Slack channel between your company and ours.
- We request all the correct information from your payment processor and merchant accounts.
- We enrol you with Ethoca and Verifi and support you throughout the prevention process.
Working with high-volume merchants
We also have a solution for big businesses: our “Bring-your-own-account” model.
If you have a pre-existing relationship with Mastercard and Visa and handle high volumes of transactions, you may be able to obtain better prices directly from them.
Still, we would be delighted to work with you. Our bring-your-own-account model combines our advanced technology platform with your existing accounts. You will also benefit from our support, expertise, and all of our other prime features.
Next steps
Whatever option you choose, you will experience the power of Ethoca Alerts and Verifi RDR. They’re the industry standard.
The question then becomes this:
How much time, effort, and resources will implementing all this require? What other benefits can I receive if I choose ChargebackStop.com over a DIY approach?
In other words, Build it or Buy it?
If you want to use Ethoca and Verifi through ChargebackStop.com or explore a bring-your-own account model, visit us and book a free demo of our platform.
FAQ: Ethoca Alerts and Verifi RDR
How can I sign up for Ethoca Alerts directly?
To sign up for Ethoca Alerts, contact Ethoca directly through their website or sales team, undergo a consultation to discuss your specific needs, and then integrate their system with your transaction processing setup.
What is the enrollment process for Verifi RDR?
Enrollment in Verifi RDR involves contacting Verifi or your payment processor, discussing your needs, agreeing to service terms, and integrating their solution with your existing systems.
How do Ethoca Alerts and Verifi RDR work together to prevent chargebacks?
Ethoca Alerts provide early warning of disputes and fraud, while Verifi RDR allows for automated, rule-based resolution of these alerts, helping prevent disputes from escalating into chargebacks.
Can small businesses benefit from Ethoca Alerts and Verifi RDR?
Yes, small businesses can significantly benefit from these services as they help manage and reduce chargebacks and fraud. The real choice is whether to work directly with them or through a dedicated chargeback prevention service like ChargebackStop.com.
What types of transactions are eligible for Ethoca Alerts and Verifi RDR?
Most credit and debit card transactions can be covered by Ethoca Alerts and Verifi RDR, depending on the merchant’s payment systems and the types of goods or services sold.