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Mom and Pop Shops Left Holding the Bag in Consumer Card Disputes
- Chargebacks have climbed by 25% in midst of the pandemic
- Many merchants are dealing with disputes for the first time
A customer inserts a credit card into Square Inc. device while making a payment in San Francisco, California.
Photographer: David Paul Morris/BloombergThis article is for subscribers only.
In her time using Square Inc. as a payments processor, Stephanie Rubio’s digital-marketing agency had never had a customer challenge a card transaction.
So the May 14 email came as quite a surprise. Rubio was told that, beginning in seven days, 20% of the payments her SoVerve Marketing Group received through Square would be held as a reserve against any future disputes. The money wouldn’t be available for four months.