How Fraud Affects High Ticket Processing
You may think the acquiring banks would be happy with high risk ticket processing. Yet, the opposite is often true. While high ticket sales represent the opportunity for profits to you, an acquiring bank sees risk.
Sure, lower ticket items are also subject to chargebacks. Still, a lower ticket item chargeback will have far less effect on your merchant account processing than chargebacks for high tickets.
A common scenario is when a cybercriminal uses a stolen credit card is to buy high ticket items, such as electronics. The items are shipped to a location in the US to avoid detection by unsuspecting merchants. Then the item is quickly shipped out of the country. The merchant, processor, and the acquiring bank are then on the hook to cover the loss.
And don’t forget about “friendly fraud” where consumers buy a high ticket item. Only to play the “chargeback game”.
Here’s how the game goes
Once a product is received, consumers call their issuing bank and claim the item was damaged, not received, not ordered, not as promised etc. Consumers have millions of reasons why they should not be responsible for paying.
Essentially, they are looking to get something for which they agreed to pay for free. And guess what? They often do.
Your high ticket merchant account includes extensive tools to protect you against fraud. And chargeback management services that prevent consumer disputes from turning into chargebacks.