Knowledge Base
Chargeback Overview
This article will provide some basic information on how ClubReady will handle chargebacks for Fully Managed clients. As a fully managed client, you have the ClubReady team available to work the chargeback on your club's behalf. The team will investigate the cause for the chargeback, gather documentation, and present the case back to the processor to reclaim the funds lost. 


Chargebacks Overview


1. What is a chargeback?


If a member (or, more specifically, the cardholder) disagrees with a charge made to their credit card, they have the right to file a dispute, or chargeback, with the bank. This right is given to them by the card company. The bank creates a dispute case, takes the money from the club's account, and requests more information from the club as to the nature of the charge. 

NOTE: ClubReady has no control over the chargebacks before they happen, and cannot prevent any money from being taken. 

The ClubReady Chargeback department receives reports from our bank daily regarding chargebacks. The analyst will mark each chargeback in the club, debit the dispute amount from the remit as well as a fee. ClubReady will create Past Due invoices and Returned Fee invoices in the member's account within the club. 

NOTE: As a club Owner, we recommend running a daily report for chargebacks and returns, which can be done under Reports > Sales > Refunds and Returns


2. How much time do I have before ClubReady begins researching the chargeback case?

Once the chargeback has been marked in the club, you will have 10 business days to determine how to best handle the chargeback. WE HIGHLY RECOMMEND the club contacting the member to resolve the dispute as soon as possible. The ClubReady Chargeback department has found the vast majority of chargebacks to be a simple miscommunication, and the club is able to quickly resolve any issues between them and the member. This also means the club potentially retains the customer, continues billing for services, and avoids negative feedback. 

If communication with member does not resolve the dispute, please make sure all documentation is in the member's account and notes are up to date. It is better to have too much information than not enough. The ClubReady Chargeback department will evaluate the case, prepare the documentation provided, and send it back to the bank for a decision. Insufficient documentation can forfeit the chargeback, resulting in lost funds for the club. 


3. What does ClubReady use to prove the member owes the money?

ClubReady uses several documents to prove the member/cardholder is responsible for the payment. Here are just a few examples: 
  • Fully Signed agreement, naming the cardholder as the responsible party
  • Signed freeze / cancellation form
  • Check In History
  • Booking Log (For Personal Training or scheduled Classes)
  • Notes in the member's account, as documented by the club
  • Copy of payment receipts and invoices
  • Medical documentation, showing injury or disability
NOTE: It is imperative all documentation is uploaded in the member's account in ClubReady. Failure to provide the necessary documents will forfeit dispute rights and the chargeback case will be rejected. 


4. What should I do if the club made a mistake and the member should win the dispute? 

If you find a billing mistake, and the chargeback is valid, cancel the invoice and notate the information in the notes section of the agreement. The chargeback analyst will review the members account and inform the bank of the cancelled invoice. 

The ClubReady Chargeback department only handles the past due invoice associated with the payment. Unless cancelled, any late payment fee invoices and returned payment fee invoices will be collected either by the club directly or by our Past Due Collections department.


5. When will I know if ClubReady won the case? 

Once a chargeback case has been sent back to the bank, we can expect a decision in 90-100 days. When ClubReady is notified that the case is won for the club, the money will be redeposited, both reflected in the members account as well as the remit. 

However, if the case is lost, no money will be returned. Past Due Collections as well as Third Party Collections will continue, in attempt to recoup the funds. 


6. How can I prevent a chargeback? 

The only way to truly prevent chargeback is to accept cash only as a form of payment. Since it is almost impossible to run a business based solely on cash, we can minimize the risk of chargebacks with the following suggested best practices: 
  • Make sure the agreement is fully signed with a legible signature, and that the cardholder is named as the responsible party. 
  • Go over the key points in the agreement: Cancellation Policies, Billing Policies, and Goods and Services Usage Policies are all potential miscommunication aspects of the contract. 
  • Get all freeze and cancellation requests in writing, and follow all guidelines of the policies in the signed agreement. 
  • Refund any erroneous charges as soon as possible. Don't wait until the cardholder notices to take action. 
  • Notate in the club notes any verbal communication. Be as detailed and objective as possible. 
  • Upload any signed forms, emails and other documentation into the members account quickly. 
  • Be upfront and honest about gym policies and rules. Again, miscommunication is the biggest reason for chargebacks. 


NOTE:
This document is intended to be a general overview of the Chargeback Process within ClubReady. Each case is unique and sometimes requires more research in determining the outcome. Even with all necessary documentation provided, it is the bank's SOLE discretion on the outcome of the chargeback case, and ClubReady cannot guarantee success. 


Related Articles: 

Top Reasons For Chargebacks ( Part 1 )
Top Reasons For Chargebacks ( Part 2 ) 


 
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