Does your business get hit by chargebacks? Are you tired of paying the extra costs associated with these reversed charges? If so, consider adding Chinese mobile payments like Alipay and WeChat Pay to your business, because there’s no risk of chargebacks with these payment options.

What are chargebacks, and why are they a problem for merchants?

Chargebacks happen when a credit card transaction is reversed, usually because a customer has disputed the charge. This may happen because the customer isn’t satisfied with the product or service they received, or because they believe the charge is fraudulent. When a customer requests a chargeback, they’re communicating with the issuing bank. The issuing bank then alerts the merchant. At that point, the merchant has some time (often one week) to acknowledge or contest the chargeback. If the chargeback goes ahead, the merchant will have to refund the value of the original transaction. The merchant will also have to pay a fee, usually a percentage of the transaction amount. Even if the chargeback doesn’t go through, the merchant is still required to pay this fee.

Chargebacks were intended to serve as protection for consumers. And it’s true that for consumers who are victims of credit card fraud or identity theft, a chargeback may be the only way to recover their lost money. But for merchants, chargebacks that result from fraud can lead to even greater losses. Besides refunding the value of the transaction and paying the chargeback fee, they also lose the value of the product. Merchants can also suffer damage to their reputation, which may ultimately be the biggest loss.

How do Chinese mobile payments help merchants avoid chargebacks?

When customers pay for products or services with Alipay or WeChat Pay, the money is transferred from their account to the merchant’s account. The fund transfers are bank-to-bank direct deposits. The customer’s financial institution authorizes each payment and guarantees that the merchant will receive the funds. It’s much more like a direct debit transaction, rather than a credit transaction.

Because Alipay and WeChat Pay don’t allow for chargebacks, there are few risks for merchants. Transactions made on these platforms are mainly replacing cash and direct debit transactions, and these don’t provide chargebacks either! Even better, if there are fraudulent or disputed transactions, Alipay and WeChat Pay absorb these costs rather than passing them on to merchants.

Are there other benefits to offering Chinese mobile payments?

By offering Chinese mobile payment options like Alipay and WeChat Pay, merchants also give consumers a more secure way to pay.

On these platforms, payments are made by scanning QR codes, and Alipay and WeChat Pay both deploy robust technologies that ensure these QR codes are kept safe and secure. They can detect QR codes that have been generated by outside systems or codes that contain malicious links. Both companies hold security as a top priority and notify users as soon as a security risk is detected. QR code security measures are continually being fine-tuned, and both companies also use advanced encryption, strict authentication measures, suspicious behaviour analysis and randomly generated payment tokens to keep customer data secure.

Alipay and WeChat Pay also take steps to educate users about ways to avoid risks. For merchants, this means keeping their networks secure against hackers. And for customers, this means keeping their operating systems updated, using password protection, and avoiding making payments while on public or unsecured Wi-Fi networks.

At OTT Pay, our strong technology solutions and exceptional customer service let us offer secure smart payment devices and seamless online payment solutions. You’ll be able to trust that every transaction is secure.

Want to learn more about how we can help your business? Contact us today at 1-800-688-9838, or email