Chargebacks?

yeah i could just have it check the list of bad serials about once a month or so and that would be it.

i’ll have to kick around some code and see if i can get it to work well. thanks for the feedback.

The price of the software seems very high. There is no social proof on the website nor is there a reason given why the price should be so high. Something like “the only software that can do this”. Both website and app look rather dated.

FYI, this rule only applies to EU citizens purchasing from EU businesses. The rule does NOT apply to businesses in the USA that are not registered in the EU. See http://ec.europa.eu/consumers/odr State your return / refund policy clearly and have your customers check a box stating that they have read and understand it before buying.

It is not possible to make a blanket statement like that for all of Europe, the same way you can’t make a statement like that about the whole USA (although generalising works a lot better there). The income / cost of living situation varies widely across the board in the US regionally, and it’s definitely not the same in all European countries. For example, wages are typically much higher here in Germany (definitely not lower! wow) but so is the cost of living, much higher than the majority of the US, excluding CA, various other West Coast areas, other big cities and of course NYC. The standard of living in Germany is also way beyond most of the USA. You might also want to double-check the Euro to Dollar exchange rate. Most people in the USA are, especially by West-European standards, quite poor.

It does though if you are processing transactions via someone like digital river who are considered EU based. So you’d need to either process the transactions yourself or find a US only processing agent.

[quote=451832:@StphaneMons]
Remember that European wages are lower than US wages and I really don’t think those prices are sustainable.[/quote]

This just is not the case on either side of pond. Ive been to parts of Alabama and Mississippi that would not be out of place in a third world country, while other parts like CA, NY and so on are fully fledged first world. Similarly if you compare parts of say Romania to Zug in Switzerland.

if the prices were not sustainable, I’d have not sold so many copies in the first place. it’s what you’re willing to pay for what capabilities and ease of use you need. one of my s/w titles is thousands less than a competitor and i dare say much easier to use, so i’ve been told by my customers. but that’s another discussion altogether. I’m only interested in opinions on handling chargebacks right now.

Consider using Stripe. They give you everything you need to fulfill your purchases automatically, the credit card statement includes your business name, you can use their checkout process or write your own, and… they have chargeback protection when using their checkout process. They’re so confident in their process, that not only do you not get charged a chargeback fee, but you can keep the sale funds too. Costs only an extra 0.1%. I have had 1 chargeback out of 1,600 transactions since their chargeback protection launched.

OK.

What I do not understand is why they want to cancel their purchase.

You said there is a demo version: it’s incomprehensible. We do not buy a product to make it a few days later.

By the way: “How many days is the refund request made on average ?”

@Patrick Besong - I know you are only interested in handling chargebacks, but I hope that does not exclude polite and friendly advice from experienced colleagues.

I have been taking credit cards since 1997 or so. Chargebacks are unfortunately a fact of life.

I got kicked out of merchant services for having too many chargebacks.

About Paypal, I have been working with them since 2000 or so. They are great at fighting chargebacks, and they did not kick me out for that.

To automate your software delivery, look into IPN in your Paypal settings. You can post to a Php script or a Xojo web app, and send out automated messages instructing delivery.

I believe they even have templates. Not for download, but for managing IPN listeners.

Note that the MAS will not bother you with chargebacks, nor will the Windows Store if applicable.

Because some people have no issues stealing physical items from stores so they have even less issues stealing a virtual item.

@Patrick Besong, maybe moving from a “ship a new licenced version” to “online activation” will drastically reduce your charge backs?

Perhaps people are thinking, “Oh well I have a fully working version now, I might as well charge back as they can’t remove the program from my computer”

I’d implement a call home feature for upgrade checking and put your lock out system into that.

I’d also move away from a buy and replace demo version to an online activation system.

Your main app is the video titler? Who’s going to be using that offline? Make it so it doesn’t work or stops working after a few weeks if it can’t call home, when it calls home it checks if they licence is still valid.

If they demand/want an offline version, do it via an online no charge back waiver, “by downloading this offline edition I waive all rights to a refund blah blah” and still put in an online check, if it ever checks home it can disable itself if the licence is revoked.

If you accept creditcards or bank transfers chargebacks can alway happen, as it’s the right of a customer to request chargebacks from their bank. You might want to use a fraud protection or inline payment in NL that will be iDeal or Bitcoin and others.

Or customise a part of the software, so you can say “no chargeback or refund wilm be done as the software is customized” (that’s a concept for in the EU, maybe US too.

You can also have a license that expires, every month and will auto-refresh if online within that month. If the pc date is put back in time you can lock the software (store the last valid date somewhere and refresh it with the latest only if the date is later in time. The check using a timer and call http check with new license (if not truely expired). The per month license type allows for only 1 month free usage if chargeback happened.

If the same customer retries to buy often, lock them out and contact them (possible fraud or bank theft!)

More than a week ago I bought a pattern package from SummitSoft. I installed it several times but the patterns were not found in any install location. I tried to contact SummitSoft 5 times that day resulting in a PHP error after the “submit” press. Then I contacted FastSpring inside my Paypal account and explained that I did not receive what I had paid for. Now more than one week later I did not receive any reply from both SummitSoft or FastSpring.

Do you wonder that I am gonna dispute the transaction with Paypal?

The moral of the story :
Make sure your application or software works error-free and in case of an error take the time to communicate with the customer. Good customer care takes you more than halfway by problems.

I do not like to dispute a transaction but sometimes there is no other way.

What is the policy of Digital River on handling such disputes? It sounds like they aren’t doing anything for you, so maybe you have to opt in or pay them extra for dispute support?

Are you sure your emails are reaching your customers? They may be going straight to spam, or worse being totally blocked. This is a huge problem, especially for any email domain owned by Microsoft (hotmail, outlook, live) and also those from Apple (mac, icloud). Yahoo, earthlink, and aol are also problematic. Customers using those emails don’t get my messages, and I have to use gmail as a backup in those cases. For account signups and anything involving email communication, I spell out these problems clearly on my websites.

I also have had good experience with PayPal, both in the US and Germany. Although EU and US PayPal services are not the same (one has to implement completely different payment systems), PayPal’s IPN works the same way in both cases, and is not too difficult to implement that in php, using their example which is on Github. In over a decade I have had only two disputes, which were settled easily through Paypal.

Sorry I have been unable to keep up with this thread lately due to other matters more pressing. Lots of good suggestions that I’ll have to consider. I did create a way to check for deadbeats online, so the basic logic is there. I would need to fine tune it and test it a lot. I’m very good about getting back to customers in case there is a problem. Usually in a matter of minutes but never more than say 8 hours for customers halfway around the world. I’m usually online anyway. I’ve even made special builds to solve their issues within a day, so I’ve had a pretty good reputation for customer service.

The chargebacks usually occur a couple months after the sale. Like I’m just getting some from May and June now. I’ve had 5 from PayPal since mid June. They don’t seem to fight the chargebacks very hard (neither PayPal nor Share-IT). I’ve even provided PayPal with the email I sent to the purchaser’s email address which I added to the original receipt. Did not know that PayPal provides a means of automating. Last time I checked they didn’t. I’ll look into Stripe, too.

I have no idea whether or not the customers in Europe got my emails or they simply ignored them (despite being translated to their languages). Not much you can do if emails get sorted to spam and if they’re bent on stealing the s/w they’ll ignore it anyway.

Genuine customers if they didn’t get the keys or have problems with your app would contact you. I do get some who write to me in their native language.

But there are those who probably never intended to pay despite needing the services of your apps. Perhaps they just pay it to get an extended uninterrupted period to get their one off work done then ask for the charge back with some lame excuse to get their money’s back.

I do have people who use my app trial, ask for this and that which i fix or add but never buy the app. It’s probably just part and parcel of selling online.

Guess the key might be to get a payment processor who doesn’t charge a fee or a low fee for charge back and vet the customers through a blacklist database. Can’t suggest any at the moment.

You must have checked a long, long time ago. I have been using Paypal IPN to deliver software automatically by download since 2001…

About chargebacks, it is the word of the card holder against you. If they say they don’t recognize a charge, there is pretty much nothing you can do. I have been taking cards since 1998, and never saw a chargeback reversed.

In fact, RFID lifting probably occurs as we are talking, and it is rather easy to lift card details electronically from six feet away. But electronics à la James Bond are not necessary. Social engineering or fake web sites harvest quantities of cards lately used by other people who had bought card numbers in the dark web.

No amount of blacklists can protect you against that, because old lady whose credit is near perfect can have her card numbers stolen and not realize it before she gets her statement.

As I said, chargebacks are a fact of life. If you sell direct to customers, better get used to them. The more you sell, the more chances you will have the honor or thieves.

Chargebacks happen.
In my experience, there are 3 kinds:

1/ Impatience. eg Customer is in the USA, I’m in the UK. They buy at 1am UK time, have a question, send 4 emails (last one in CAPITAL LETTERS) within 30 minutes, then raise a chargeback because I’m ‘ignoring them’ while I sleep. :slight_smile:

2/ Forgetfulness / cash shortage. They buy, and get a credit card charge a month later that says ‘FastSpring’ or similar, and dispute it because they dont recognise the name, or are short of money. ((FastSpring send an email just prior which reminds them: you bought this, the statement will say ‘FastSpring’, everything is OK’ This helps a lot)

3/ Simple theft. Some people know it’s their word against yours. So they buy, install, then dispute knowing that you have little comeback. This is thankfully rare.

No-one fights chargebacks very hard.
But FastSpring do some pretty thorough checks for card misuse before they allow the sale through.

Dial home is one method to handle this, but it can cause trouble for the good guys.

(I cant use Paypal directly any longer due to the VAT mess introduced in 2015 for download-only software - not sure how strict it is applied, but the EU demands VAT from suppliers for any software sold for download to European countries.
I cannot handle that myself, so I pay FastSpring to act for me instead.)

I am starting to see the light here: some month after the sale is too many times after the sale. Yes, it is not a car, but can you imagine returning a car two or three months after the sale ?

Someone who have a temporary need to use your software will use for it, then return it ?

Did you approch a lawyer to discus what can be done regarding the return delay (8 to 15 days is enough to make an idea about a software) ?

Other idea: I am not sure, but if the web site I watched is really yours, it looks like no update were done since the “Beatles young days”. Update it (add 2019 as a date, refresh things here and there), so people stop thinking the site is old.

[quote=452854:@Jeff Tullin]Chargebacks happen.
In my experience, there are 3 kinds:[/quote]

You forgot one :

4/ The card number has been stolen, the card holder is of good faith, and discovers abuse on it’s statement. Disputes the charge with the CC company, and by the time the dispute has crawled in the corporate meanders, one more month has elapsed.

I sell software that can be considered sensitive (MICR fonts that can be used to forge checks). I am regularly the victim of fraudulent purchases, obviously using credit card numbers lifted from their rightful owner.

https://www.nasdaq.com/article/credit-card-fraud-and-id-theft-statistics-cm520388