[demarq]

Controversial take here. Sue your customer. No really.

Banks operate on risk, make chargebacks risky.

Some of these chargebacks sound like straight up fraud. Three months of usage and using their bank to reverse a payment.

Make Fraud Spicy Again

[greyb]

Suing for $43 would absolutely be frivolous and would be thrown out by all but the most bored small claims courts.

The best you could do is send your client to collections, though if you try and mess with their credit report, that incurs liability on your part. Funny enough, German companies do send SaaS/IaaS clients with small bills owing to collections, even for amounts as small as 15-20 EUR.

[evermike]

Of course we would never do anything like that. In the post I just shared two different cases to give some perspective to the community.

From everything discussed in the article, there are a 2 major takeaways:

1) You need to avoid chargebacks as much as possible.

2) If a chargeback does happen, the chances of winning are basically zero — unless you can convince the customer to withdraw it.

[qhwudbebd]

UK perspective here: I've not claimed for $43, but I've used the small claims process to recover £65. They replied to the paperwork sent out by the court indicating they intended to defend it, so I paid the hearing fee to take it to court, where the judge was polite, helpful, very switched-on, and didn't seem remotely annoyed by the size of the claim.

The total costs of making the claim were more than the amount I'd claimed, but I'd been careful to provide all the proper notice and offer to settle for the amount of the claim, so they were awarded against the defaulting client.

It was great fun and I think it would have been fun and educational even if I'd lost. Would definitely do it again.

[Spivak]

The problem is that chargebacks are like the perk of using a CC for transactions. So if companies start doing this to an any degree that makes CC customers hesitant to use the CC's customer protection feature they will find a way to make it the merchant's problem again.

The best you can really do is be large enough that cutting ties with your business entirely isn't feasible for the customer.