Natural Disasters, Refunds, and Chargebacks

Oct 3rd, 2022

Managing Refunds and Chargebacks When Affected by Natural or Other Disasters

The vacation rental and short-term rental industry are more popular than ever. Rental managers are seeing more people use their services and seasons are being extended well after what used to be the traditional tourist season.

Of course, with this success, there are still challenges and pitfalls out of the rental manager's control, including natural disasters such as hurricanes, fires, and floods.

If you find yourself impacted by an event, natural or otherwise, that causes your rental properties to be temporarily unavailable or affects the traveler’s ability to start or complete their stay, we can help you navigate the impact.

If you find yourself in one of these situations, we urge you first to look at the big picture.

Consider being flexible with your cancellation policy
Consider offering a credit for a future stay, in situations where you are not offering a refund
Process refunds due in a timely manner in the same manner payment was received and communicate with your guest to help avoid a dispute
If you choose not to issue refunds for guests who did not or could not stay, it is possible that you will receive some chargebacks.

Common chargeback reason codes in these situations include Services Not Rendered and Cancelled – Credit Not Processed.

In these cases, online bookings can be your friend – as long as your checkout process is structured correctly according to the card brands like Visa, MasterCard, and Discover.

If the guest did not stay and you want to fight the dispute, the strongest response includes proof that the cardholder agreed to your cancellation and refund policy at the time of payment and that they cancelled outside of that policy.

For e-commerce or online bookings, Ascent has put together the following best practices for how your web pages and checkout process should be structured to best protect you from the above types of chargebacks.

Webpages

Every business accepting payments online should have webpages and checkout pages that include:

Your business name as it will appear on the customer’s credit card statement
Your address (include country of business formation), customer service phone number and customer service e-mail address
Your privacy policy, terms of service, and cancellation/refund policy
Complete description of goods or services provided
Pricing for each product/service clearly listed
The appropriate Acceptance Marks (card brand logos of cards you accept) must be displayed on your website where the accepted payment methods are listed

Checkout process

On the same screen as the checkout screen indicating the total transaction amount OR within the sequence of web pages accessed by the Cardholder before the final checkout page, include:

Your address, terms of service, and cancellation/refund policy
The disclosure may be a link to a separate page if that link forms part of the “click to accept” acknowledgement and refers to the return, refund, or cancellation policy
A “click to accept” button, a check box, or other acknowledgement indicating the consumer has read and accepts of the terms and the cancellation policy

Final checkout screen

Cardholder must not be able to process payment if they have not agreed to the terms/cancellation policy

Your checkout screen should include:

Page must be secure (https://)
Total Due visible
Transaction currency
Consumer card’s secure code (CVV), expiration date, and Address verification and secure code validation must be included as part of the authorization request (verify with your software provider)

Receipts

If the reservation is accepted, you need to provide a transaction receipt that is:

Printed by the customer AND/OR
Mailed and/or e-mailed to the cardholder
The receipts should contain specific merchant and transaction information (contact Ascent for more details)

If the guest booked online, and you are responding to a Services Not Rendered or Credit Not Processed dispute, Ascent suggest providing screenshots from your checkout process that show that the consumer had to “click to agree” to the cancellation/refund policy before they could pay. It can also be helpful to provide a signed agreement with cardholder signature or initials within 1 inch of the cancellation policy.

Reach out if you have any questions or need any assistance! clientsuccess@ascentpaymentsolutions.com