Each time a buyer files a chargeback, the merchant receives a penalty fee of up to approximately $60.00 + ITBMS ($64.20).
This penalty is charged even if the buyer subsequently cancels the chargeback. For example, if it was filed due to non-delivery, but the item shows up a few days later, the merchant will still have to pay the fees and administrative costs associated with the process.
If the chargeback rate exceeds 2% against the processed sales, PagueloFacil could simply cancel the merchant's account. This means a frozen or restricted account, with the ability to process credit card payments revoked. Merchants cannot accept credit cards when they have a restricted or closed account.
If the merchant's account is cancelled, PagueloFacil may report that business for blacklisting. This means that the merchant has been blocked and will possibly be inconvenienced to enable a new account with a different processor.
PagueloFacil may apply a reserve account to merchants that receive chargebacks on a regular basis. This account does not accrue interest and is used to support or mitigate the losses that the merchant might suffer.
While merchants have the right to dispute illegitimate chargebacks, developing an effective dispute requires a significant number of resources and information. A chargeback dispute rarely ends with a win for the merchant without adequate supports.
Winning a chargeback dispute does not improve the merchant's ratio of chargeback vs. processed transactions; the merchant may recover profits, but it will not reduce the risk of a cancelled merchant account.