How to handle Wells Fargo chargebacks in 2020
While the chargeback process is largely defined and structured by the heavyweight card networks like Visa and Mastercard, the issuing and acquiring banks that get involved in transaction disputes have some leeway to set their own unique rules and procedures. The right representment for one issuer might not pass muster with the next bank you deal with because of some small detail related to timing or documentation. We hate to see merchants lose out on revenue due to avoidable mistakes, so we want to arm you with the information you need to deal with all the major issuers. With that said, what do merchants need to know about Wells Fargo chargebacks?
As the seventh largest credit card issuer in the United States, Wells Fargo handles a commensurately high rate of chargebacks, so you can expect to be dealing with them fairly often. Wells Fargo has lost some market share in recent years because of the fallout from their 2016 account fraud scandal, and while that means they have extra incentive to keep their current customers happy, we would hope that it also motivates them to carefully abide by the card networks’ dispute rules.
Remember, while the issuers may be your temporary adversaries in chargeback disputes, Visa and Mastercard own the court. Whether you’re dealing with your first Wells Fargo chargeback or your fiftieth, this guide can help ensure you follow all relevant procedures to the best of your ability and, hopefully, win every winnable dispute you can.
Wells Fargo Chargeback Fee
When serving as a payment processor for merchants, Wells Fargo charges a $25 fee for each chargeback. They also reserve the right to recoup fees levied by other institutions involved in the dispute.
As an issuing bank, Wells Fargo, can’t hit merchants with any fees, but remember that in the event that a dispute proceeds past the representment stage and goes into arbitration, the card network handling the matter will collect as much as $500 in arbitration fees from the losing party. If you take a chargeback to arbitration, make sure the facts (and documentation) are on your side.
Wells Fargo Chargeback Policy
Wells Fargo customers can dispute a transaction up to 60 days after it posts to their account. They allow their customers to initiate claims either by phone or through their online banking account.
Once a dispute has begun, Wells Fargo follows the standard chargeback procedures, starting with issuing a provisional credit to the customer and submitting a retrieval request to the acquirer to begin their investigation.
Wells Fargo Chargeback Time Limit
While customers have 60 days to dispute a charge, merchants must respond to retrieval requests within 12 business days. Always respond to any chargeback-related notifications and requests promptly; this helps to ensure that the banks have enough time to properly evaluate your information.
Once the process has begun, the most important time limits for merchants to remember are the ones imposed by the card networks. Here’s a quick rundown of some of the key time limits:
After the chargeback process kicks off, the timeframes laid out by Visa and Mastercard take precedence:
- 18 days to respond to a Visa dispute (whether you’re fighting or accepting the chargeback)
- 30 days to submit representment after acknowledging the chargeback
- 10 days to request arbitration after the pre-arbitration process is finished
To avoid missing deadlines or making mistakes in a rush to meet them, we strongly recommend that merchants have procedures in place to respond to chargebacks immediately.
Wells Fargo Chargeback Process
Wells Fargo provides the following recommendations to merchants to avoid chargebacks. We suggest that you follow this advice to the best of your ability and document it, so that in the event of a Wells Fargo chargeback, you can provide them with proof that you were following their recommended best practices:
- Use AVS to verify billing addresses
- Verify the caller ID on phone orders
- Include a toll-free telephone number on your merchant descriptor that appears on billing statements
- Obtain proof of delivery for all orders you ship
- Require a signature for delivery of high-value items
Of course, these tips will serve you well for disputes with any issuer, not just Wells Fargo.
Wells Fargo Chargeback Portal
If Wells Fargo is your acquirer or payment processor, you should sign up for the Dispute Manager service they offer. This online portal allows merchants to receive chargeback notifications, acknowledge disputes, and respond to retrieval requests. The portal also contains resources to learn more about chargebacks and how to respond to them. Using the Dispute Manager can greatly streamline the process of managing chargebacks and will help you respond in a timely fashion.
Benefits of Analyzing & Disputing Chargebacks
Fighting chargebacks can be tough. Researching disputed transactions and putting together the right evidence can take up a lot of your time and labor. As tempting as it can be to just let small chargebacks slide, each one you receive hurts your chargeback ratio and depletes your revenue. Remember, the true cost of a chargeback isn’t just the transaction amount—you have to account for the fees and related expenses as well.
The silver lining of chargebacks is that each one is an opportunity to learn about problems customers are having with your business. Whether it’s fraud, merchant error, or problems with fulfillment, you can look at every chargeback you get and think about how you could adjust your operations to prevent the same chargebacks from happening again.
By making the effort to understand the root causes of your chargebacks, you can learn how to prevent them, how to fight them better, and how you can meet your customers’ needs and expectations better.
Conclusion: Wells Fargo Best Dispute Defense
The strongest anti-chargeback strategy is a universal one: be honest and transparent, provide the best customer service you possibly can, use the best anti-fraud tools at your disposal, and thoroughly document your transactions and customer interactions.
When it comes to dealing with specific issuing banks, keep in mind that while experience will teach you some of the nuances that help you get the right outcome, most of the rules and requirements are coming directly from the card networks. Stay on top of the published rules (and new mandates), remember the key time limits, and do the best you can to defend yourself from fraudsters and frivolous claims.