Debt Collection for Chargebacks and eCommerce

By on November 15th, 2018 in Industry Insights
TrueAccord Blog


Chargebacks are frustrating. Debt collection for chargebacks can help.

Chargebacks are a part of doing business, but they’re also incredibly frustrating. It’s a slow, disjointed process that can hit 1-2% of your GMV. Chargebacks create multiple issues.

  • Chargebacks take time to get to you. A consumer can take months to charge back and while the majority of chargebacks come in in the first 30-60 days, not all of them do. You may lost revenue you thought you had several months after you book it.
  • Chargeback dispute is manual, slow, and often ineffective. Chargeback often arrive by snail mail with very little time to respond, and evidence collection and submission is tedious.
  • Many chargebacks are caused by buyer’s remorse and abuse of credit association rules. As high as 30% of eCommerce chargebacks may be the result of remorse, spouses using the other’s card without their knowledge, or just friendly fraud.

Many businesses start their own payment operations teams, focusing on detection and prevention. There’s a lot you can do in detecting fraudulent and abusive behavior in advance. When you don’t, and representation doesn’t work, debt collection for chargebacks is a tool you must consider.

Can debt collection for chargebacks really help?

Debt collection for chargebacks is an effective complimentary process, working hand in hand with representation to increase your recovery rate. The customer is liable for paying you based on your terms of service, even if you can’t charge their card.  Debt collection, especially with a digital-first solution, will improve your chances to recover and reduce your risk of alienating your customers. Clearing out the reason for their chargeback might help you win them back as customers.

You must approach these customers with the right mind set. TrueAccord is exceptionally good at handling disputes, not only blindly go after the money. By listening to your customer, we are able to discern with greater accuracy whether the chargeback was a result of fraud or something else. We lead the customer into paying back what they owe, telling us their story and giving you feedback, and getting them back to paying status. It’s a win all around.

Interested in trying us out? Sign up here!

The basics of debt collection for startups: talking with customers

By on November 13th, 2018 in Industry Insights
TrueAccord Blog

Startups live and die by customer acquisition and growth, and that is where they spend most of their time and effort. However as many startups find out, retention is key to continued growth. Active current customers spend more, and are more likely to use other services your offer as well as refer others to your service. As part of our debt collection for startups service we meet many consumers who’ve churned and left an unpaid bill. We’ve learned that customers who churn sometimes provide businesses with the most important feedback.

Why do customers churn? The vast majority don’t do so with malicious intent, even if they leave an unpaid balance behind. Most of these situations involve a service or product dispute. A disappointed customer feels that paying is unfair, even if they agreed to a charge in advance. Some have real cash flow or billing issues. What do you gain from talking to these customers, or from using a service to engage with them?

  1. They have the most pointed feedback for issues with your product or service. Deciding not to pay is a strong decision often driven by an exceptionally bad experience. This is the equivalent of a bug bounty program – finding what went wrong while recovering money. Debt collection for startups should be focus on soliciting that feedback, not only getting you paid. Listen to the content rather than the style, and you’ll discover a plethora of relevant product and process feedback.
  2. They care enough to make it noticed. Not paying is a strong signal, and you want to unpack what happened. The same issue this customer identified may impact thousands more who, instead of not paying, just churn – or hurt your referrals. You need to talk to them to find out what’s going on.
  3. They often owe you money. There is revenue to be recovered by reconciling with churned customers, both money they owe and future income. While TrueAccord offers debt collection for startups, our NPS is 60 – mostly because we offer a positive experience in a negative situation. Engaging with these customers or using a partner to do so can turn their perception by 180 and change your relationship trajectory.
Approaching and reconciling with churned customers is an art and science. Follow our blog to learn more about how we do it!

Interested in trying us out? Sign up here!

How to send less consumers to collections as a small business

By on November 9th, 2018 in Industry Insights
TrueAccord Blog

Getting paid is a difficult job, and one that small businesses often struggle with. Customers will surprise you with excuses and disputes that can severely influence your cash flow. In this post we’ll discuss ways to engage with your customers early so you won’t have to send them to small business collections.

Prepare to Receive Less Than 100% of What You Are Owed

Some customers won’t pay, no matter what you do. They may disagree they need to pay at all, irresponsible, or genuinely had a life event that impact their ability to pay. You’ll eventually need to use a trusted third party like TrueAccord to get these ones to pay. Accepting this saves you time and heartache – there’s a limit to the number of calls and reminders you should offer late payers and a limit to the time you or your team should spend on them. Still, there are ways to get closer to 100% even before using a small business collection service.

Reducing the Rate of Late Payers

Preventing late payments requires a structured process to keep them aware of their obligation, deal with expected excuses, and following up until you get paid. Specifically, pay attention to the following:

Be planned with giving out credit. Negotiate payment terms in advance, write them down, and limit how much risk you take in every transaction. Adopt pre-paid models whenever possible, and require a payment instrument before you let customers use your product. Beware of new customers, those without a long established history, that run up a balance on their first days or weeks. If you run an eCommerce business or a marketplace, frequent and aggressive purchasing sprees from new customers are a major red flag and should be stopped and examined by your risk team.

Be prompt in issuing your invoice or charging a payment instrument post completion of a job or with following up on late payments. Have a process for following up on chargebacks, outstanding balances, or invoices early and often, even if you end up sending some balances to a small business collections partner. Even if you don’t get paid on time, keeping on top of customers increases awareness and prepares them to negotiate payment terms when they’re able to.

Be frictionless in your methods of payment. Keep a payment instrument on file even if your model is post payment, and verify it with a $0 authorization or random charges. The more payment options you have, especially the more backup payment options, the better your chances of getting paid. PayPal was able to recover more than 95% of failed ACH payments thanks to using cards as backup payment instruments.

Be polite in your communication with your customer. They might not pay you today, but end up being a valuable long term customer if you just work with them through their current situation. Your goal with your receivable management process isn’t only to prevent late paying customers, it’s also to retain relationships with the most valuable ones. Don’t let a temporary situation ruin a beneficial long term relationship.

Be ready to escalate. You may invest a lot of effort in order to prevent late paying customers, but you are not an A/R expert and are not planning to become one; your team isn’t either. Using a third party takes emotion out of the equation, allows customers with service disputes to express themselves, and creates an opportunity to negotiate. Having a small business collections partner as a last resort also increases your chances of recovery just by informing customers that it’s an option. We don’t like it, and we’re always focused on great UX, but the negative perception “debt collection” evokes can work in your favor.

Bottom Line

It’s not easy to prevent late paying customers, but following a process, a few best practices, and using a strong small business collections partner can get you paid much sooner than you usually do. Think through your on-boarding, billing, and follow up process to significantly reduce the number of people who end up not paying – and talk to us when you’re ready to hand them off.

Interested in trying us out? Sign up here!

The Importance of Smoke Tests

By on October 23rd, 2018 in Industry Insights
TrueAccord Blog

In this short talk, our CEO Ohad Samet and our Senior Manager of implementations, Robert Rodriguez, discuss the concept of a smoke test in high stakes integrations in collections and how they can help reduce errors and create early success.

Diversity & Inclusion at TrueAccord

By on October 16th, 2018 in Industry Insights
TrueAccord Blog

How come every company hires the best people they can find, but some end up with a homogenous culture while others are diverse? It’s about how you seed and grow your culture.

Hear our Diversity, HR and Recruiting leaders talk about diversity, representation, and hiring diverse talent from day one.

Conversations With Customers

By on September 18th, 2018 in Industry Insights
TrueAccord Blog

Laura Beckerley discusses easy and difficult conversations with customers, and provides tips and ideas and how to diffuse difficult situations. Hear about her experience, how we engage, and what makes TrueAccord different – a customer facing brand through and through.

Creating Effective Quality Controls

By on September 11th, 2018 in Industry Insights
TrueAccord Blog

Working with major financial institutions has its upsides, but it also means a tight and very demanding quality framework. Our lead trainer, Quan Ngo, talks about tips and tricks for effective quality control in an ever changing environment.

Using Design to Empower Customers

By on September 4th, 2018 in Industry Insights
TrueAccord Blog

UX and design are important tools in TrueAccord’s tool box. Hear from our Product Design Manager, Shannon Brown, about how we design our product to empower customers and encourage positive actions.

Julie Hughes talking website design for collections

By on August 30th, 2018 in Industry Insights
TrueAccord Blog

Originally posted on Accounts Recovery.

A collection agency website has to be a lot of things to a lot of people. It should be a tool that the agency uses to attract new business from potential clients. It should be a tool to help individuals pay their debts. It can be a tool that individuals use to educate themselves about debt and finance. It can be a tool to attract new employees. And it all has to be done compliantly and while making sure the culture and values of the agency shine through to the person visiting the site for any of those reasons.

A panel of agency executives shared their strategies and the thought processes behind their company websites recently, revealing how they approach their sites to make sure they check as many of the boxes listed above as possible. During the webinar a number of great ideas were discussed.

To read more, click here.

Engaging with empathy: content strategy at TrueAccord

By on August 28th, 2018 in Industry Insights
TrueAccord Blog

Content is the life blood of our system. No matter the channel, the product, or the stage, content is what keeps our customers engaged, our performance high, and our compliance intact. Hear our manager of Content Strategy, Vivian Chau, talk about how we harness empathy to write effective content.