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Comment by kilobite88 | Hacker News Reader

Chargeback abuse is mushrooming. Word's getting out that chargebacks are free refunds. No need to engage the merchant anymore. Very selfish customers are now able to get their product and eat it too, for free.

Instead of being an advocate for their customers to the financial institutions, Stripe is siding with them and we all have to fend for ourselves.

Obviously, consumer protection mechanisms are needed and around for a good reason, but something happened during the pandemic. People don't care anymore. Look it up, chargeback fraud has massively increased since 2020.

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It's beyond just 'theft', really. It's punitive - charging you fees, and damaging your reputation with payment systems - while taking whatever item/service you offered.

I doubt Stripe is big enough to fight their partners on something like this anyway though.

My first business selling software in 98!ended after two charge backs. I just didn’t want to continue and at the time being a teen didn’t know it was possible luckily I moved on selling again on the internet services , also easy to charge back. I can’t say it’s higher, 1-2% of volume maybe at the high end, sometimes it’s a stolen card some times it is abuse even though I do offer refunds. I am not a crypto bro by any means but have to say I love crypto payments because there are no charge backs.

Would it be legal for merchants to band together, share a pool of cards with a history of chargebacks, and block payments from those cards?

Merchants do not have access to the CC numbers, the payment processor does. And even if they did, what you're proposing would be far more work than it's worth. If you wanted to, you could get a list of email addresses from accounts that have submitted excessive chargebacks, and put in some form validation logic that prevents them from making further transactions.

Sounds like a simple service someone could provide. API with two endpoints: one that takes the hash of an email address + details about the chargeback (dollar amount, etc.) and another that returns some kind of score based on the same email hash.

Merchants could opt in to the database by agreeing to share chargeback data. If someone on the list tried to sign up, the merchant could either block the sign up or present an alternative/safer payment method (e.g., direct deposit).

All that being said, no idea if it'd be worth it for merchants.

anyone want to help me build this? first we get traction on hackernews (as we clearly see demand for it), join YC, sell to startups, serve ethoca their lunch, then potentially get acquired by Stripe?

Merchants probably don't have enough information to do that themselves, but it does seem like a service a provider like Stripe would be happy to provide.

I have a feeling the ML fraud models such as Stripe radar encodes some of that, even if unintentionally.

i run a startup. I would be extremely willing to join a shared blacklist API. If this comment gets votes, I will make a service and populate it with data from our end.

Ethoca basically facilitates this.

Customers are just smart precapitalists.

I think issuing bank would block the card owner if they file chargebacks too much / too often. Is it not true anymore?

Visa and Mastercard cut off vendors that are pinged with too many chargebacks. It's partially why they avoid dealing with porn site payments. Too many people use the service and then claim it wasn't them.

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