Latest / Talk Commerce / Tim Tynan Reveals How Every Chargeback Tells a Story and chargeback management Best Practices
Transcript
- Brent Peterson (00:02.082) Welcome to this episode of Talk Commerce. Today I have Tim Tynan. He is with Chargeback Gurus. Tim, do an introduction for yourself. Tell us your day-to-day role and one of your passions in life. Tim Tynan (00:14.047) Okay, well, thank you, Brent. Thanks for inviting me. It's great to be with you and your listeners. And yes, I'm Tim Tynan. I'm the CEO of Chargeback Gurus. We are a company that helps merchants, other companies with the dispute process. We help them manage that for credit card disputes, you know, working with all the different players like Visa and MasterCard and the banks, both on the the issuing side that provide credit cards for you and me and also the banks on the merchant side. And we help them manage that process to resolve disputes. I'm a person that's been in the industry for many decades, working with a number of players like Bank of America and Citigroup. anyway, glad to be with you today, Brent. So what do I have a passion for? Well, I mean, I definitely have a passion for my family. And I guess I would say as a hobby baseball. you know, Yankees fan and enjoy sports. Brent Peterson (01:18.37) Yeah, our interview was going so good and then you had to mention the Yankees. Geez, no, we'll move on. We'll move on from there. I'm a Twins fan, which is a tough one. It's probably worse being a Vikings fan or a Mets fan, Mets, know, whatever. Tim Tynan (01:37.397) I'm an Irby Puckett fan for what it's worth. Brent Peterson (01:39.81) Yeah, he was great and I know the Mets got Santana back in the 90s. Let's not talk about baseball, but I'm also a baseball fan. But before we get started though, you have graciously volunteered to be part of the Free Joke Project. I'm just gonna tell you a joke. All you do is give me a rating 8 through 13. So here we go. If your mother-in-law starts giving you parenting advice, tell her, hang on a minute, I live with one of your kids and they never listen. Tim Tynan (02:11.702) Well, I gotta tell you that that hits home with me because I have a terrific mother-in-law. was with her last night and it's true. It's true. So listen, how can I give you anything less than the best Brent? You're a 13 all the way. Brent Peterson (02:23.31) All right, awesome. All right, so how do you make, my first question, and I've been in the industry for a long time as well, how do you make chargebacks exciting? How do you engage a merchant and say, listen, we gotta talk about chargebacks? Tim Tynan (02:40.938) Well, one thing we like to say, which is really true when you think about it, is that every charge back tells a story. And if you really dig into it, if you investigate it, a dispute, right? Disputes have happened since the beginning of mankind. Cavemen and cavewomen had disputes. so right till today, when you think about it, there's detail behind it. you know what happened behind that what what about the transaction what kind of industry was it what kind of amount was it you know who did the purchasing why is there a dispute was in an error was it some fraud so it tells a story and if you dig into it you know if you do find that that story behind it Brent Peterson (03:26.286) So chargeback gurus suggest that you've niched down into the market, right? And I know I remember as an e-commerce manager talking to the people that helped you save money on shipping. so I'm assuming you help and consult with merchants to relieve some of the stress on chargebacks, is that correct? Tim Tynan (03:51.351) We do, we do, and it's a complicated process, or it can be. And so part of our job is to simplify it for a merchant to help them work through that process. At the end of the day, the important thing is the right information gets to the right people to make the right decision. So you have banks involved on one side, you have merchants involved, you have the consumer. You know, there's different parties, Visa and MasterCard. There's certain rules associated with protecting consumers so that they have rights. on a dispute and clearly the merchant needs help with that too. So that is what we do. We help manage that process and get to the right decision. Brent Peterson (04:30.06) And is there specific areas in charge backs that are common that merchants maybe overlook? And I'm thinking, you know, I've done charge backs in the past and part of the part of it is you just can't get ahold of anybody and you get so frustrated as a consumer, you're just like, okay, I'm just going to call Visa and and dispute the charge. Is there a punch list of items that you recommend right off the bat to help them in that process? Tim Tynan (04:55.67) Yeah, I mean, if you're a consumer, the best thing and the first thing I would always do is call the merchant, call the store or the, if it's an online, find the process, whether it's an 800 number or whether it's through email, but find it, go to the merchant. That's the first thing to do and explain your issue. And oftentimes they can resolve it. But if you can't, there's other outlets too. Again, it's the bank that issued your credit card. can call the number on the back of your card. Visa, MasterCard have numbers and help desks as well. So there's multiple places to go to get a resolution. once you, and you shouldn't have any trouble finding somebody, call one of those numbers, somebody's gonna pick up, you start the process. And it's typically a 180 day process from beginning to end, and oftentimes are resolved in days, not weeks or months. But you kick off that process, and that's really the investigative. It's to gather the information and to make the right decision. And that's where we play. We help merchants with that part. Brent Peterson (06:04.426) You mentioned VAMP earlier in our green room conversation. Tell us about the VAMP program and how that's impacting merchants and consumers. Tim Tynan (06:12.448) Sure. So Visa just announced something called the VAMP, right, which is the Visa Acquire Monitoring Program. And, you know, these are industry terms. And Acquire is a bank, essentially, that acquires the credit card or debit card or gift card, whatever the card transaction is, and helps do the clearing and settlement of the monies that need to go between the, you know, you as a consumer with your credit card. that you purchase something with and the other side of that transaction with the bank for the merchant to assume that they get their funds for the goods and services they provided. But the Visa acquiring monitoring program is replacing something that Visa had before. They had a program called the Visa Dispute Management Program, which was about chargebacks, and they also had something called the Visa Fraud Management Program, which is just about fraud. you know, the true fraud, a fraud that happens from bad guys abusing the system. so it's Visa's trying to simplify these two programs, bring them together on the one ratio that both a merchant needs to manage to and both an acquiring bank needs to manage to, and to keep those ratios low as it relates to total transactions. You know, and it's all about reducing fraud. and reducing chargebacks and it's really meant to protect consumers but also it protects people like the merchant as well. Brent Peterson (07:46.094) From the fraud standpoint, I know there's a number of companies like Signify and these other that help upfront to relieve or to kind of weed out those things. Is there good best practices that you recommend to get make sure that you're not even getting to the point of having a fraudulent card that's being used on your website and then somebody's going to do a chargeback? Tim Tynan (08:11.694) If you're a merchant, there definitely is. Right up front, it's making sure that a consumer understands terms and conditions, making sure that you've got documentation for that transaction. Merchants have things like account verification, address verification, those little three numbers on the back of your credit card, the CVV. All those things ensure that the right person, that a legitimate person is making that transaction, not a fraudster. So there are clearly things like that. And you mentioned like Signify, Riskify, those are good companies that provide some merchants with a scoring mechanism to make decisions that this is a good transaction, this is not a good transaction, you can accept it, you can ship the goods. So that's part of sort of fraud management. We play, Chargeback Gurus plays a specific role. after the transaction to help with the dispute piece and the banks play a role in making the decisions about adjudicating that dispute. you know, they're different players and all play a role. Tim Tynan (09:33.226) some reason, Brent, I can't hear you now. Okay. Brent Peterson (09:34.67) Oh, sorry, there we go. In your role, there's a threshold that merchants have to meet, right? There's a threshold that they can't have so many chargebacks. So is part of your role making sure they're under that threshold? then does it mean eventually you might work yourself out of a job or is there always gonna be these chargebacks? Tim Tynan (09:57.174) Yeah, that's a good question. And it's true. If we're doing a good job, we're helping to reduce chargebacks. Now, of course, part of what we do is we manage the process and we help a merchant recover revenue from that chargeback or the consumer, you know, if they should get a refund. So there's no doubt if we're doing a really good job, we're helping to reduce chargebacks. But there's always going to be disputes, too. So there's a need for both. There's a need for somebody to manage the process. And clearly, reducing chargebacks is the right thing. And yeah, this new VAMP program has changed the ratios. typically, in the past, they were about 1%. So you wouldn't want more than 1 % of your total transactions to end up as a chargeback. The same was true with fraud. You wouldn't want anything above 1 % of fraud of your total transactions. And with the new program, again, they combine those two ratios, the fraud ratio, chargeback ratio. And the numbers have changed a little bit. There's a little more generous room for a merchant. The program next year, 2026, when it's fully rolled out, goes to about 1.5 % for a merchant. But for the acquirer, again, the bank that's taken that transaction, the clear and settle, as I mentioned before, their number is now 0.7. So there's more responsibility with VAMP being shifted to the bank to ensure that they're monitoring fraud and they're helping to reduce chargebacks. So both still have responsibility, but yeah, those numbers have changed slightly. Brent Peterson (11:36.458) One of my biggest frustrations as a consumer is the subscription model where you've subscribed, they get you to pay for a year in advance, and you forget you don't even use the service anymore. And then suddenly you get this big charge. Is there some rules around that the merchants have to give you some, they have to give you first an idea that this is gonna happen the next month and then. Is there a point in which they give you that charge and then you're like, no, that's, I don't want this. I want to cancel right now that there must be some rules around that. And there must be some ways you help coach merchants to make that process better. Tim Tynan (12:18.355) Yeah, that's a really great question because I think best practice with a good merchant that has a subscription business not only has very good communication upfront about, you know, the business rules, if you will, to do business with them, but also the opt out capability that you can opt out of that subscription anytime you want. And it should be easy to do. You know, Apple is a good example of that, you know, on your, your Apple iPhone. if you subscribe to things through Apple, it's part of the settings, you can go in and unsubscribe any time that you'd like. So having the ability to unsubscribe is very important. Having that opt out capability is important. You know, that's one of the rules that, you know, in the dispute process would be part of the information that would be shared with the bank and also the consumer. You know, whether they did opt out and that would be a best practice. Brent Peterson (13:13.606) How about when a consumer, well, let's go back just to the subscription model again. So the idea is that you're helping the merchant to reduce it, but is there a way that you can help them to almost eliminate it other than what you've already said about the opt-out and... Is there a best practice that you recommend in there from a merchant standpoint who has like a SaaS model that's doing a service rather than a product? Tim Tynan (13:45.29) Yeah, it's definitely about information and education. I mean, there's no doubt that the more simple you could make it for a consumer, if you're in a subscription business, again, opt out to me is table stakes. That should be always offered. But, you know, reminders, it could be constant reminders too. It could also be a little pop-up screens about education. Now, you know, there's that balance if you're in business, you know. Obviously businesses want to increase the acceptance of their credit card payment. You know, they want people to have access and use of whatever their subscribed service might be, whether it's streaming service or some sort of periodical information, or maybe even to a podcast. You know, there's all different, of course, things that people want to take advantage of and use. So there's the balance between that. You know, there's the consumer protection, opting out, education's important. There's the... the business or merchant wanting to have higher acceptance rates and clearly be able to provide their service in an easy, frictionless way. So I just think, think best practices are the ones I've seen have a lot of education, make it very simple to use. It could be pop-ups that you can get off the top of a screen. It could be reminders every time you reuse it. It could be a monthly reminder, for example, too, that is also a best practice. Brent Peterson (15:07.753) switching the gears a little bit to AI. In the communication process, more more merchants are switching to a bot on their website. And I can just say from my experience with a SaaS player, I got put into a loop and I actually canceled my subscription because they've removed the human from the customer experience. How much are we seeing a shift from removing humans in that and then the increase in retention for clients or even chargebacks because of this shift to more of a bot version of customer service. Tim Tynan (15:51.603) Yeah, that's also an interesting topic. It's new ground, obviously. What early days you're seeing with AI is in the customer service area, where a bot's helping to answer questions or provide information. There's no doubt people are using AI also for decisioning. For example, we do. At Chargeback Gurus, we've got... you know, these machine learning algorithms that we built that really help with providing information in a more effective and efficient way, and then help with decisioning about whether a dispute should be continued to be investigated or not, or just a quick decision could be made. But you're talking about something interesting too, like, know, agentic AI where, you know, bots might actually help with the purchase process. You know, I think it's going to be interesting to see. I don't think that people have figured that out yet. think there's still rules to be decided. I personally wouldn't have an agent buy for me, but okay, but maybe I'm not, you know, the typical purchaser too. I think there's always going to be both too, to be honest with you, Brent. And as it relates to the dispute process, it's all about the information. Like if you, if you subscribed and you gave authority, for this process to take place, well, that's something that's gonna be part of the decision process on who made the right choice of decision there. But what I think is best practice too, and I'm a technology guy by training too. I worked for IBM for a long time before I got into banking and payments and ultimately things like merchant processing and now chargeback management. From a technology perspective, It was always best practices to have both. You want to leverage things like AI. You want to leverage these large language models and the data that's out there. But you want to leverage it in a way that's useful to the company, the business, and also provides some value to the consumer. But it's never one without the other, from my perspective. Even in our business, we have experts that do Tim Tynan (18:12.436) the things that we do and provide value to our merchants and we leverage some of the best technology. So it's a combination of both. But it'll be interesting to see where these bots end up in the future. These avatars and people that look like cartoon versions of Tim Tynan or Brent Peterson and actually do more than just give you information. So a lot to be seen in the future there. Brent Peterson (18:36.078) You know, you've brought up an interesting point about the AI, the agent at commerce bots, and that really makes a really good play for the charge back bot to resolve it, right? So somebody that's really, they're focused, a thing or an entity that's there to focus to get it done. they're doing, they're always coming back to you to say, here, here's what we need. I, we've probably already kind of do that with sequences and some other of the automations that are in the process, but I would do imagine in the future that there'll be this sort of like the automated voice or automated bots that you see on websites that are helping to resolve that even with voice or having, you know, there's all kinds of ways to do it. But I would imagine that that's a really good application that could go out and find all the information, come back and help you as a merchant to and as the even as the bank to resolve the chargeback situation. Tim Tynan (19:39.957) Yeah, I think there's a role for it. There's no doubt. And like I mentioned, we're already leveraging AI and some best practices with machine learning. But by the way, I was just thinking as you were saying that, there's a good joke probably out there. Two bots walk into a bar and one's got this and one's got that. I'm sure you'll have that in future program. But I actually, from my perspective, it's you can't. the expertise, the specialties, the people knowledge, the history knowledge that people have with working in the industry, that's always gonna be really important for at least our clients. I don't see where we'd have a bot do our job. I could see where it's enhancing it, it's augmenting it, and it has specific tasks and roles. And one of the reasons for that is it's really important that the information is 100 % accurate. You know, and of course we know AI has hallucinations today and it's great tool but it's based on the data that's available and it makes mistakes. And so that's why a combination of using it more for efficiencies, effectiveness, I mean we use it for like quality control too. You know, we'll use it to make sure do we have the right information, do we have the right evidence. Have we done the investigative work? Is the quality of the documentation that we have to pass to somebody else even readable? I mean, that doesn't sound like AI. That sounds like basic technology, but it's leveraging large language models as well in the data. So there's a combination of both that I think is the realistic approach today. I think people are also running towards AI because chat GBT just made it more consumable. It made it more easy for people to get information and, And so that people are running towards that to apply it to every walk of life. Every company has got different people focused on AI projects. And my advice to anybody, again, as a technology guy from years past when IBM helped create some of the technologies people are leveraging today, is it's a combination of both. And you really want to make sure it's practical and it's used the right way. Tim Tynan (21:57.084) And I think some of the early players are trying to do that. I know we are. Brent Peterson (22:01.774) Yeah, you bring up a really good point about machine learning and AI and machine learning has been around for years and Watson and IBM have been in this game for a very long time doing exactly what now we're doing as consumers, maybe AI is the democratization of that machine learning and allowing more people to participate in it. Tim, we have a few minutes left as I close out the podcast. I give everybody a chance to do a shameless plug about anything they'd like. What would you like to plug today? Tim Tynan (22:31.475) Well, thank you for that. listen, Chargeback Gurus is a great company. I'm honored to be part of it. We have some talented people. We have some really terrific clients, too. Some of the largest companies on the planet are our clients. And we can help a merchant with dispute management. We've got expertise. We've got data. We've got some best-in-class technology. I already mentioned something about AI and machine learning. but we can help merchants. So if you're listening to this and you've got a fraud problem or a chargeback problem, we're the place to go look at. We can easily be found on the website, chargebackgurus.com. And anyway, Brent, I appreciate that shameless plug. I didn't expect that, so thank you for that. Brent Peterson (23:20.876) Yeah, you're very welcome. So last question. Do you remember Roger Clemens as a Boston Red Sox or as a New York Yankee? Tim Tynan (23:28.595) I remember him as both because he was a fierce competitor and of course that that game that he pitched where he was hurt and it was blood in his socks and he was still pitching and when I was with the Red Sox but I was happy to see him join the Yankees so both yeah. Brent Peterson (23:32.45) you Brent Peterson (23:44.492) And I can say that I saw him in the playoffs. The twins would often come against the Yankees and lose in the very first round of the playoffs. So I've seen him live at what was the Metrodome, the Yon Dome. yeah, anyways, Tim, it's been such a great conversation. Tim Tynan is the CEO of Chargeback Roos. Thank you so much for being here today. Tim Tynan (24:09.373) Thank you, Brent. Appreciate it.