Prevention alerts are a valuable chargeback management tool. But unfortunately, not all chargebacks can be intercepted with an alert.
To understand prevention alert coverage, it’s helpful to understand how they work.
Prevention alerts are provided by two vendors: Ethoca and Verifi. These vendors maintain networks that issuing banks can join. Banks can participate in Ethoca’s network, Verifi’s network, both networks, or neither network.
If a bank is a member of a network, the bank can send an alert when a transaction is disputed. However, if the bank is not part of a network, the dispute will automatically advance to a chargeback and you won’t receive an alert.
Since participation in a prevention alert network is optional, some issuing banks have decided not to use this service. Other banks don’t have the data capabilities or technology to support this service. This is the primary reason why you don’t receive an alert for all disputes.
If you sign up for both Ethoca and Verifi prevention alerts, you should be able to prevent about 30-40% of disputes from becoming chargebacks.
If your results are below this average, there may be other things happening:
The basic functionality of both alert providers is the same. However, the way they go about providing that functionality is slightly different.
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Originally created to help merchants resolve issues resulting from non-fraud, consumer disputes
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Strong presence in US, expanding into international regions
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Originally created to help merchants resolve issues resulting from legitimate payment card fraud
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Strong presence in both US and international regions
If you want the most complete protection possible, we recommend you accept prevention alerts from both Ethoca and Verifi. This ensures you receive alerts for as many dispute categories and geographical regions as possible.