Payment Reversal is the process of canceling or returning a payment transaction to its original source. This can occur through chargebacks, refunds, or cancellations, either for legitimate reasons or as part of fraudulent activities.
Types
- Chargebacks
- Refunds
- Cancellations
- Bank reversals
- Authorization reversals
Common Causes
- Fraudulent transactions
- Customer disputes
- Processing errors
- Technical issues
- Service dissatisfaction
Risk Indicators
- Multiple reversals
- High-value transactions
- Unusual patterns
- Cross-border payments
- New accounts
Prevention Methods
- Transaction monitoring
- Fraud detection
- Documentation
- Customer verification
- Clear policies
Best Practices
- Proper authorization
- Clear communication
- Dispute resolution
- Record keeping
- Policy enforcement
Payment reversals require careful management to balance customer service with fraud prevention.