This concept is elegantly simple. It is the title of this article, a way to describe the need, and the place where you can find out more about the concept, all at the same time. Oh, and before I forget, it is also the name of the product. nochargebacks.com became live on November 1, and Steven Peisner, President and CEO of Shared Information Systems (the company that operates the site and product), has been running as fast as he can to meet the inquiry demands ever since.
All merchants are aware of the problem called chargebacks. In fact, if credit card business is conducted on the Web, it may be an even greater problem for them than for those in the retail world. This product and concept has been developed, as Steven Peisner notes, because "Necessity is the Mother of Invention." Peisner says, "We donít make the Internet a safe place to shopówe make the Internet a safe place to sell."
Who is Steven Peisner and why does he have a special knowledge of the chargeback problem?
Steven has been in the MSP/ISO business for almost 13 years. During the past seven years he has specialized in providing merchant services to mail order, phone order, MLM, catalog, and internet merchants, and has become very knowledgeable about the rules, regulations, concerns, and problems that are associated with these types of merchants.
After working with Cardservice International for approximately five years (both as an agent and direct employee), Steven resigned his unofficial position as Special Accounts Manager in September of 1997 "to take advantage of the greater opportunities that awaited him."
Stevenís time at CSI Corporate was spent building a processing portfolio of special merchants. Steven told us he built this portfolio to a processing level of nearly $30,000,000 per month, which we are told was over seven percent of CSIís monthly processing volume at the time. If ranked separately by the Green Sheetís GSQ "U.S. Bankcard Merchant Acquiring" report, it would have been ranked approximately number 651. When talking with the merchants, Steven noted that they all suffered from the same problem, something he likes to refer to as "Electronic Shoplifting." "Consumers have found a way to steal, and even more than that, a way to get away with it, and it is called a "Chargeback," notes Steven
So what is nochargebacks.com?
This is a site that merchants can access prior to authorizing or completing keyed or real-time transactions via an electronic payment gateway. The merchant is checking a negative database comprised of consumers who have a history of charging back credit card transactions. Also contained in this database are thousands of addresses that appear to be normal street addresses, but in actuality are privately owned and operated mail and post office box locations, i.e. Mail Boxes, Etc., Postal Express, and so on.
The rules protect the cardholders and MOTO merchants have very few rights in the event of "CDC" chargebacks. Try explaining to a merchant that they have very few rights when a consumer steals from them. The merchant loses their product, money, and time. Not to mention the discount charged on the sale, and a chargeback fee, usually $20 to $25 per occurrence. Next comes the warning letters and even, in some cases, a "terminated merchant status."
1. GSQ, The Payment Systems Quarterly Volume 1, No 4 "U.S. Bankcard Merchant Acquiring Services", November 1998, Published by The Green Sheet, Inc.
There are many companies providing some type of fraud prevention, but 99% of them handcuff the merchant to credit card processing. Most of the prevention techniques are only enhanced AVS systems with velocity features for declining transactions. Shared Information Systems can interact with any credit card processing platform because they do not process transactions; they act as a filter to be used prior to obtaining an authorization or completing a keyed or real-time transaction.
Shared Information Systems is interested in establishing working relationships with ISOs/MSPs and acquiring banks that provide services to MOTO and Internet Merchants. They are looking for seasoned and established organizations that can bring significant sales and service resources to the relationship. Their unique service will provide your organization with additional income by providing merchants with the protection that they need. I understand that Shared Information Systems pays on-going monthly residuals for the life of the account. ISOs/MSPs and sales reps looking to become Shared Information Systems agents can contact their offices at (818) 878-9700 or steven@nochargebacks.com or visit them on-line at www.nochargebacks.com.
