The 16 Best Chargeback Management Software Tools to Reduce Fraud Loss

Bolt Team September 26

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Chargebacks are transactions disputed by the cardholder. To a retailer these affect revenue, as they are sales that later need to be refunded. In many cases, these costs are absorbed by the merchant.

Detecting and protecting against chargeback fraud will help give customers a better experience, identify fraudulent charges before they occur, eliminate them when attempted, and secure checkout for your customers. Better still, it will help you combat checkout abandonment and recapture lost revenue.

To learn about chargebacks, the impact they have on your business, and the best tools to manage chargebacks on your payment platform, we’ll cover the following:

Before we look at the best chargeback management tools available, let’s look at the sources and causes of chargebacks. From here, we can start to understand what chargeback management tool features you need the most and how you can benefit from using a chargeback software.

Sources & causes of chargebacks

Understanding the reasons for chargebacks is essential for solving the root of the problem, instead of putting a bandaid on it. Knowing the main reasons for chargebacks will help you isolate the problems and adjust accordingly. To start, you’ll want to know how chargebacks work to be able to effectively reduce chargebacks.

Chargeback reason codes can give you insight into the error, but do little to help you solve the root problem. Use reason and error codes to analyze the true problem and find impactful solutions.

In general, there are three main types of chargebacks:

1. Merchant or Customer Error: Small, seemingly insignificant errors on the merchant or customer’s end can cause chargeback errors.

2. Criminal fraud: Cardholders that discover unauthorized transactions file a chargeback with their credit card company. Ultimately, the merchant becomes the victim, often absorbing those charges to compensate their customers.

3. Friendly Fraud: Cardholders use loopholes in the chargeback system, exploiting and stealing from the merchant in the process.

Within these main categories of chargebacks, there are more specific issues that cause chargebacks. Many of these fall into one of the categories above, but each have various causes and solutions.

  • Cancelled transactions and returns: When customers decide against a purchase or return a product, this results in a chargeback. These count as chargebacks and will impact your revenue, but they are authentic, not fraudulent chargebacks.
  • Affiliate fraud: When illegitimate affiliate marketers enable a large quantity of fraudulent transactions to increase their revenue, cashing out before the merchant becomes aware of the fraudulent actions.
  • Fulfillment issues: Errors in shipping, packaging, and delivery can all result in chargebacks, as customers are no longer satisfied with the product or experience. Isolating holes in your supply chain and distribution process can help you fix these problems to reduce their impact on lost revenue.
  • Lack of clear/responsive communication: Customer service and support is important for customers waiting on shipping products. As customers shop online and never get the chance to deal with a representative, customer support options should be provided throughout purchase and after to help customers get their delivery.
  • Authorization and processing errors: These can occur on your end, or the payment processor’s end. Either way, they impact your revenue and are an area for improvement. Analyze why these errors occur and work with your processor to clear them up at both ends.

Types of chargeback management tools

Tackling chargeback issues on your ecommerce store can be approached in a variety of ways, using different types of tools. There are a few main types of chargeback management tools to choose from, differing in features, quality, and pricing.

SaaS

Short for “software as a service,” SaaS options involve licensing software that handles chargebacks on a subscription model. You manage, monitor, and update the system yourself.

Pros:

  • Flexibility and adjustability
  • Control over system
  • Less expensive than fully-managed, outsourced tools

Cons:

  • Less support available; responsible for management
  • Inconsistent performance
  • More time and effort put towards managing this tool

Fully Managed

Outsource chargeback management to a company that specializes in chargeback monitoring and management. Allow them to manage chargebacks for you, taking much of the responsibility from you and leaving it in the hands of experts.

Pros:

  • Leverage experience and expertise in chargeback management by trusting professionals
  • Save your workforce time and effort by outsourcing
  • High-quality chargeback management
  • Focus on what you do best, while relying on experts for chargeback security

Cons:

  • Significantly more expensive than SaaS service options
  • Less control and flexibility over how the system operates
  • By giving another entity control, there is a chance they will miss some instances of fraud

Hybrid Solutions

You may find that neither fully-managed nor SaaS are entirely the right fit for your business. In this case, you may opt to create a hybrid of both models. Choose to manage SaaS services yourself for tools you think you can handle efficiently, while outsourcing more difficult or burdensome tasks to a full-service company.

You may decide to manage your own chargeback systems to identify transactions and chargebacks to dispute, while opting to rely on a full-service company to take care of handling the actual disputes.

Pros:

  • Create the level of control you want
  • Allow flexibility where you need it
  • Get the best of each service as you need

Cons:

  • Integrating all tools can be more difficult as there is more to synchronize
  • Requires more coordination across your own systems and those that you have outsourced
  • Creates additional bills to manage for your team, depending on how many services you use

The 16 best chargeback management software services

The best chargeback software solutions will include core chargeback management features and provide benefits to the checkout for both customers and the merchant. Choosing the right chargeback tool will require purchasing a platform that provides the features essential to your service.

To help you choose the right product, we’ve compiled a list of the best friendly fraud services available. See what each has to offer and select one that fits well with your ecommerce platform.

1. Bolt

Example of Bolt checkout order form

Cost: Pricing dependent on business needs; quotes available.

Target Company Size: Any

What Sets This Tool Apart: Optimize checkout with faster speeds, without compromising on security.

A full-stack payment processing platform that leverages top-quality fraud protection to improve the customer experience and fight fraudulent activity. They are so sure their services work to protect payment and increase revenue, they offer a 100% fraud guarantee. Let Bolt handle your security and give yourself peace of mind about chargeback loss.

2. Signifyd

Example of Signifyd checkout dashboard

Cost: Small business (Free to install and 1% charge on approved orders); Medium business ($1,000/mo); Enterprise (custom pricing based on business needs).

Target Company Size: Small Business; Medium Business; Enterprise

What Sets This Tool Apart: Investigate and follow up on each case individually, maintaining high-quality customer experience and support while still fighting against fraud to root it out.

Eliminate fraud and optimize revenue by recapturing potentially false fraud and reducing chargeback fees. They believe in a deep dive into actionable chargeback insights, helping you identify the source and cause of the chargeback as well as protect against it and resolve the situation.

3. Square

Example of Square checkout dashboard

Cost: 2.65% for all major credit cards; $0.10 flat fee per Interac; 3.4% + $0.15 per transaction for keyed-in transactions; 2.9% + $0.30 per transaction for online transactions.

Target Company Size: Any

What Sets This Tool Apart: Square’s checkout systems offer full terminal tools, from online payment processing to in-person POS systems.

An ecommerce and in-person payment processing solution, offering terminal hardware with point-of-sale app that makes transaction processing simple. Invoicing, on-file card storage, API customization, and integrations are also available with this product, making it fit many customer needs.

4. Chargeback Gurus

Example of Chargeback Gurus Root Cause Analyzer results

Cost: Pricing dependent on business needs; quotes available. Online estimate calculator that evaluates your expenses and recovered revenue for services.

Target Company Size: Any

What Sets This Tool Apart: Fight, prevent, and recover chargeback fraud to effectively manage friendly fraud cases.

Their Root-Cause Analyzer identifies reasons for chargebacks using over 40 data points, an ROI calculator to evaluate recovered revenue, and prevention analysis to understand where to apply prevention methods to decrease fraud most significantly.

5. Chargeback.com

Chargeback.com management platform example

Cost: Small merchants ($8,000 annually); Midsize merchants ($30,000 annually); Enterprise merchants (varies based on business needs)

Target Company Size: Small Business; Medium Business; Enterprise

What Sets This Tool Apart: Full-service SaaS for internal dispute management, enabling control over fraud detection and protection.

Focused on lowering dispute rates for chargebacks and ensuring that fraud is prevented and authentic transactions are approved. By approving otherwise rejected payments, you increase conversions by using stronger fraud detection tools.

6. Chargebacks911

Example of Chargebacks911 dashboard

Cost: Pricing dependent on business needs; quotes available.

Target Company Size: Any

What Sets This Tool Apart: Reduce threats and occurrences of chargeback, recover lost revenue from chargeback fraud, and repair business relationships and reputation with a complete chargeback software system.

Chargeback fraud prevention technology that seeks to approve all valid transactions to avoid false positive revenue loss, a leading loss of income for ecommerce platforms. Having partnered with leading companies, Chargebacks911 offers top-quality integrations to fully protect against fraud and effectively handle chargeback disputes.

7. Accertify

Cost: Pricing dependent on business needs; quotes available.

Target Company Size: Any

What Sets This Tool Apart: End-to-end solution that manages the entire chargeback fraud process, from detection, protection, and prevention to management and dispute resolution.

Accertify’s Chargeback Management software provides an end-to-end payment solution that allows you to minimize chargeback costs and improve on successes. It comprises powerful workflow management, web-based reporting and analytics, dynamic system updates, and solution integration.

8. Y2 Payments Chargeback System

Cost: Pricing dependent on business needs; quotes available.

Target Company Size: Any

What Sets This Tool Apart: Preemptively identify and stop chargebacks, as well as reverse chargebacks when possible to recoup lost revenue.

Operating in the background of collection management software and HMI payment gateway, this software identifies and intercepts consumer disputes prior to them escalating to a chargeback. They use an alert network meant to reduce chargebacks through service and reconciliation.

9. VeriFi

Example of VeriFi checkout dashboard

Cost: Pricing dependent on business needs; quotes available.

Target Company Size: Any

What Sets This Tool Apart: Fight, combat, and eliminate chargebacks to reduce potentially lost revenue.

This full-service payment protection and management solution will handle your ecommerce platform so you can focus on the core aspects of your business. Order Insights features utilize fraud detection to avoid friendly fraud and capture more revenue. They also target low value-transactions that add up to significant lost value over time.

10. FIS Global

Cost: Pricing dependent on business needs; quotes available.

Target Company Size: Any

What Sets This Tool Apart: Outsource chargeback management and resolutions, shortening time to resolve these issues.

Resolve chargeback disputes and recover more revenue by capturing payment chargebacks and reducing liability. Speed up resolution and settlement timeframes, reducing the impact chargeback fraud has on your business. Recover more lower-value transaction fraud cases as well, contributing to overall revenue growth and reduced chargeback loss.

11. CUBEbilling

Cost: Fixed monthly options (Infrastructure $1,000 to $4,000; Automation capabilities $0 to $1000; Branded site $0 to $250); Variable monthly items (User packs $200 for 5 users to $2,000 for 1,000 users; Support package $0 to $500)

Target Company Size: Any

What Sets This Tool Apart: Aims to simplify billing and chargeback data, so financial data is accurate and transparent.

Centered on the premise that understanding costs and revenue clearly leads to better business decisions, CUBEbilling is a cost allocation and cross-charging system. As a cloud-based software, it is easy to access and use by multiple stakeholders.

12. Ethoca

Cost: Pricing dependent on business needs; quotes available.

Target Company Size: Any

What Sets This Tool Apart: Multilingual support for chargeback management tools and strategies.

With a global network of banks and merchants, Ethoca provides multilingual support on their website (English, French, Spanish, Portuguese, and Chinese). Their tool is designed for detecting friendly fraud, chargebacks, and protect against these attempts.

13. MiDiGATORExample of MiDiGATOR checkout dashboard

Cost: Pricing dependent on business needs; quotes available.

Target Company Size: Any

What Sets This Tool Apart: Detect and protect against chargeback fraud, while also automating and streamlining processes to allow you to focus on building a great product for your customers.

Use data analysis to deep dive into customer behavior, helping you prevent chargebacks and reduce payment processing risk, fight chargebacks and recover revenue, and automate tasks and streamline processes for improved business efficiency. Focused on meaningful analytics that lead to actionable insights, MiDiGATOR helps manage your chargeback fraud and reduce the impact on your bottom line.

14. ChargeBackHelp

Cost: Pricing dependent on business needs; quotes available.

Target Company Size: Any

What Sets This Tool Apart: Manage chargeback disputes with a full-service software to manage detection, protection, and dispute resolution.

A comprehensive payment and fraud management system, it features chargeback prevention tools, chargeback representment, and a PCI-compliant payment gateway designed for high-risk merchants. Safeguard retailer accounts from fees and penalties due to chargeback, recovering revenue that would be otherwise lost.

15. The Chargeback Company

Cost: Pricing dependent on business needs; quotes available.

Target Company Size: Any

What Sets This Tool Apart: With a clear understanding of how fraud impacts your business reputation, it focuses on providing a secure and simple checkout for customers.

Servicing a range of industries (ecommerce, travel, retail, digital, and institutions), The Chargeback Company provides scalable chargeback solutions that help you manage chargebacks occurring on your platform. With integration capabilities for leading tools, this chargeback software will work with systems you have in place and enable easy improvements in the future.

16. Baldwin Hackett & Meeks, Inc.

Cost: Pricing dependent on business needs; quotes available.

Target Company Size: Any

What Sets This Tool Apart: Manage chargebacks along the entire transaction lifecycle, including credit card, debit card, ATM, POS, and mobile transactions.

Concourse Disputes is a powerful workflow management system that operates the chargeback process from initial claim entry to final resolution for both card issuers and acquirers. Manages the chargeback disputes, as opposed to preventing or protecting against chargebacks. Not about optimizing chargeback process or flow either.

Benefits and features of chargeback management software

Any solution you choose should aim to solve problems for both you as a retailer and for customers using your site. Chargeback management software tools offer key features and benefits, and picking the best tool will come down selecting features that are most important to your business and success.

Here are some of the core features any chargeback management software will include, helping benefit your payment process.

1. Fraud detection

Fraud detection can take two main forms, identifying the user or fraudulent behavior. Either way, you can use fraud detection to stop fraud in its tracks, before it happens, by authorizing the payment. Since chargebacks are justified if a purchase was not authorized, this step should be done prior to authorizing payments to ensure fraud is stopped before it happens and revenue is not lost.

2. Address Verification Service (AVS)

Compare billing address to the address on file for the payor’s account. This verification step can be used to decline seemingly high-risk transactions. AVS is also required for handling disputes with major credit card processors, and without this step it will be harder to successfully debate chargeback disputes.

3. Credit Card Verification code

All credit cards have a card security code (also referred to as CVV2, CVC2, CID, etc.). Payment processors that include this step actually communicate with the credit card company, verifying the correct code was input for the customer’s credit card. A mismatch can indicate potential fraud attempts; use this data to decline transactions that may not be authentic.

4. 3D-secure

Many leading payment processors now offer 3D-Secure protection. This allows you to establish a PIN for credit card transactions, adding a layer of protection and security. For leading processors, this is called Mastercard SecureCode and Verified by Visa, but other providers also offer this added level of protection.

5. Blacklist

As part of your fraud detection system, a blacklist is a dynamic database of customers who have been charged back or have filed a chargeback dispute. When integrated with your CRM (customer relationship management) platform you can identify and flag orders by customers from this database. This allows you to signal fraud charges based on past behavior. Use this to cancel or block potentially fraudulent charges.

6. Workflow management

Software tools manage many of the processes in the background, handling chargeback fraud for you largely automatically. This frees up time and effort to focus on what you do best, develop great products and sell on your ecommerce platform. Control and develop your system as needed depending on the flexibility and control you want, perfecting the system to manage chargeback fraud for you.

7. Solution integration

The more features you have, the more you can customize the experience for your customers and the more protection you can offer. Having a solution that integrates with multiple other tools and services can enhance your ability to detect and prevent chargebacks. Whether it needs to integrate with Legacy systems you are currently using or allow for flexibility in the future, solution integration options enable enhanced features and better performance.

8. Chargeback notifications

Enable communication between you and issuers, allowing you to resolve disputes and reduce their impact on your chargeback rate. When a customer disputes a transaction, you are given an alert. This gives you the chance to refund the transaction to the vendor and avoid a chargeback dispute. This is a last ditch effort to eliminate chargebacks before it impacts your business.

9. Chargeback analytics

Post-chargeback analytics are ideal for understanding how chargeback fraud occurs, how it is occuring on your platform, and brainstorm ecommerce metrics to track that will allow you to improve conversions and reduce the impact of chargeback on your bottom line. The more you know, the more action you can take. Study user behavior and track patterns, getting better at identifying, preventing, and eliminating chargeback fraud.

Before choosing a chargeback management system, consider the reasons for chargebacks in general, and more specifically how they occur on your store. Isolate the areas for greatest improvement and select a product that can handle the issues affecting your business most acutely.

Rather than purchasing a range of services to fully manage different aspects of your checkout, select a single solution that uses high-end fraud protection, helping eliminate the impact chargeback has on your store. Bolt’s fraud prevention and protection technology (backed by their 100% chargeback coverage guarantee) will stop fraud in its tracks while offering a seamless, convenient checkout experience for shoppers. Reduce chargebacks and friendly fraud on your platform, capturing more conversions and revenue.

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