2020 Whiplash for Vacation Rental Market
I’ll bet some of you feel like you have whiplash.
March – May of this year set record lows for bookings along with record highs for refunds and chargebacks.
Ascent’s data show a 45% increase in the number of chargebacks our clients have received during the first half of 2020 over those received in 2019 all year.
And our data shows over 6 times as much refund volume in March – May 2020 over the same timeframe last year.
Then June came along and set records for increased bookings and processing volume. Some property managers processed over twice as much volume in May and June as the same timeframe last year. Many were booked solid through the end of the summer by the middle of June.
If you feel like it is hard to keep up with the changes and difficult to know what will come next, see our quick advice for processing credit cards in the vacation rental industry in 2020:
Contact Ascent if you anticipate a spike in volume, so we can alert the bank. Acquiring banks have velocity checks in place to throw up flags when they see processing outside the norm for a merchant. A big increase in volume can cause you to hit the existing monthly processing limit set to protect the bank against fraudulent or mistaken activity. Ascent can help get your account set up correctly as quickly as possible for your new volume.
Have a game plan for chargebacks.
Be flexible with your refund policy to reduce your chargeback risk.
Respond to ALL chargebacks, even if it is to say that you accept the dispute and agree with the funds going back to the cardholder.
The top 2 Chargeback categories received so far this year are Credit Not Processed (43%) and Services Not Provided (21%), which bumped Fraud out of the usual top spot. For these case reasons, most often used due to cancellations due to COVID-19, Visa has offered help for merchants:
If a cardholder purchased services and the merchant cancels due to a government prohibition of providing the service paid for, the cardholder should not have a right to dispute the transaction and receive a refund. You can use this verbiage when rebutting a chargeback to which this information applies.
If a cardholder is unwilling or unable to use the services made available by the merchant, who has fulfilled its obligations to provide the service and has properly disclosed its terms and conditions, the cardholder should not have a right to dispute the transaction and received a refund. You can use this verbiage when rebutting a chargeback to which this information applies.
Contact ASCENT for help – we have the knowledge and products to help our clients protect themselves during these crazy times!