We understand that chargebacks can be one of the most frustrating challenges for towing businesses, especially when dealing with non-consensual tows. Disputes can feel unfair, and despite your best efforts, chargebacks are never completely avoidable. 

However, having strong documentation and payment smart practices in place can make all the difference in minimizing your risk and protecting your business.

Mitigating Chargebacks: Best Practices

Preventing chargebacks starts with implementing strong payment policies and clear documentation. Here are seven key strategies you can employ:

1. Use EMV Card Readers

   Always use chip-enabled (EMV) card readers to accept payments. This reduces fraud-related chargebacks by verifying the card was present at the time of payment. Avoid manually keying in card numbers when possible, as this increases your risk.

2. Check Identification and Obtain Billing Information

   When accepting credit card payments, be sure to match the cardholder’s name with a valid ID. Collect the cardholder’s billing address and ZIP code. This helps verify the transaction and provides evidence in case of a chargeback.

3. Require a Signed Authorization

   For non-consensual tows, require customers to sign an invoice, receipt, or digital form acknowledging the tow and payment terms. This serves as proof they approved the charge.

4. Provide Itemized Receipts

   Clearly outline charges, including towing fees, storage fees, and any applicable taxes. Send an electronic or paper receipt to the customer’s email or phone.

5. Capture Photo Evidence

   Take before and after photos of the vehicle, including its location and any visible signage. Retain copies of property signage indicating parking restrictions.

6. Maintain a Clear Cancellation & Refund Policy

   Clearly state your refund policy on receipts and signage. If refunds are granted under specific conditions, outline the process customers should follow.

7. Document Comprehensive Service Records

   Thorough documentation is key to protecting your business against chargebacks. Ensure every service is recorded with essential details such as dates, times, locations, services performed, and customer interactions. Clear, time-stamped records strengthen your case in the event of a dispute.

TowPay

At the end of the day, chargebacks are an unfortunate reality in the towing industry, but with the right tools and best practices, you can significantly reduce their impact on your business. 

TowPay is our integrated payments solution built specifically for your Towing Management System. Take advantage of key features like integrated card readers, Link-to-Pay, 3D Secure, and more to help protect your transactions and streamline payments.