[gnutrino]

The amount of fraud and scammers out there is insane. I worked on a platform that only had a few hundred in revenue a month (just starting out). We did many smaller transactions, and getting hit with disputes was a killer. If someone did 15 transactions, they could get hit with 15 chargebacks up to 3 months later. So for every transaction, even if it only generated $3 in revenue, the chargeback could be potentially $15. (And you lose the revenue!). So for one customer who only spent $45, you could lose $270.

Even when we knew the person was legit, and just wanted a refund, they would do disputes. We only won a handful of disputes. The bank / credit card company will almost always side with their customer, even when provided receipts / terms of service / conversations with the customer where they admit the product met their needs.

[RicoElectrico]

How come the chargeback value could be that much higher than the revenue? (NB: revenue, not profit)

If I buy a $3 product and chargeback, then I get $3 back, right? Or does the payment processor bill you $15 for each chargeback no matter the transaction cost?

[gnutrino]

Yes, the payment processor will charge you for each chargeback. Stripe’s fee is $15 per chargeback.

[cies]

Chargebacks are a creditcard thing. In some countries people are willing to pay with methods that do not allow chargebacks.

Also chargebacks do not work for wiretranfers. So you can ask them to do a wire transfer instead

[IAmGraydon]

You honestly think someone is going to set up wire transfer for an online subscription service?

[cies]

In some countries this is not uncommon.