Are You Leaking?

There is never an occasion when leakage is good. 

And in Payments, it’s a massive problem that goes unresolved.

What do we mean by leakage? Merchants pay out of pocket to enroll into a handful of mitigation services. These services are necessary for managing disputes and chargebacks, and ultimately, for keeping within compliance.

But what happens when these tools don’t work correctly? Merchants can start to see previously refunded disputes show up as chargebacks. And after a while, all of those extra chargebacks start to chip away at the Merchant’s compliance thresholds. 

Leakage is wasting margin. It’s when a Merchant gets enrolled with dispute mitigation services to manage chargebacks, but still ends up paying out of pocket for chargebacks that were previously refunded.

Why is plugging the leak so important? 

Because leakage can be life or death for a Merchant. 

Merchants can quickly find themselves falling out of compliance. And once they’re in the middle of a storm; it’s too late. Merchants can eventually get dropped by their Processor, and without processing, that Merchant runs the risk of being put out of business. 

But don’t worry, leakage is solvable. Over this next series of Bytes we’ll breakdown everything you need to know. 

May 9, 2024

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