Dating Site ChargebacksKiss Dating Site Chargebacks Goodbye With These 5 Helpful Tips

Dating Site Chargebacks: Why They Happen & How to Prevent

Once upon a time, people met, dated, and fell in love in person. True story. Before the rise of the internet, no one could have predicted that finding love online would become the new norm. Nevertheless, it's become one of the primary ways for couples to find one another.

Online dating is now the preferred way to find love for many people. Roughly one-third of US adults have used a dating app. And, one in five adults under 30 that are currently in a relationship say they met their partner on a dating app.

As you might expect with numbers like these, online dating services are extremely popular and profitable. Nonetheless, traditional banks and processors consider dating sites “high-risk” ventures. The reason is that the vertical tends to pose a greater likelihood of chargebacks and disputes.

So, how can merchants take advantage of the online dating boom without the heartaches associated with frequent dating site chargebacks? Let’s find out.

Dating Site Chargebacks: At a Glance

A dating site chargeback happens when a customer disputes an online or in-app subscription or one-time purchase. When this happens, the cardholder’s issuing bank forcibly reverses the transaction, causing you to lose out on revenue and incur a chargeback fee.

Dating apps have limited channels for monetization; nearly all of them revolve around access. Most dating services either operate off a tiered or unlimited subscription model, a freemium model where users pay for profile boosts or virtual gifts, or an ad-based model.

The first two monetization models, which usually require users to make recurring payments, tend to be chargeback-prone. Subscription models attract disputes because users often forget that they subscribed. Or, because they find cancellation policies to be onerous or unfair. Even one-off purchases in this vertical come with elevated dispute risks, since buyers expect to pay for results (i.e. matches or dates), even though you can’t make any guarantees.

If customers feel like they’re not seeing outcomes after sinking money into their site, they may dispute their purchases out of frustration or retaliation.

Much Ado About Chargebacks: 4 Big Questions Regarding Disputes

Chargebacks are a surprisingly complicated matter. With that in mind, let’s delve in and answer a few of the most often-asked questions about chargebacks and how they relate to the online dating industry.

Why Do Dating Apps Receive so Many Chargebacks?

Dating site chargebacks can be complicated. While we established that there are three fundamental  chargeback sources, there are innumerable potential chargeback triggers relating to those sources.

While these triggers are not unique to dating sites, they often take their own unique forms based on industry. Here’s an example that’s common to dating services: a customer pays for service, finds a match right off the bat, then files a chargeback to recover the money.

The customer might rationalize this by thinking, “I subscribed less than a week ago, and I was only on the site a couple of times!” That may be true, but it’s still not fair to you: after all, you provided the service and helped the customer just as promised.

This is a friendly fraud practice referred to as cyber shoplifting. Whatever the customer’s rationale, it comes down to the same thing: the intentional abuse of a chargeback to get something for free.

There are other, more benign threats out there, too. Take buyer’s remorse, for instance; a user may decide your service wasn’t what they were looking for, or that they couldn’t afford it. While it’s not really blatant cyber shoplifting, the cardholder is still not entitled to a dating site chargeback. You may also have a customer who signs up for a free trial, then forgets to cancel in time before being charged. This is a common problem among subscription-based merchants.

Chargebacks exist on a spectrum, with merchant fraud on one end, and cyber shoplifting on the other. Everything in the middle can be stopped through prevention or representment, and up to 86% of chargebacks fall under this category. The trick: you need the right tools and strategies.

Top 5 Best High-Risk Processors for Dating Sites

While not necessarily ideal, high-risk merchant status is not the “kiss of death” some merchants think it is. Many reputable payment processors specialize in high-risk verticals like online dating and can help savvy merchants combine maximum profitability with affordable client-friendly service.

These high-risk processors are the best in the game:

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How Can Dating Apps Fight Chargebacks?

So, you got a chargeback, but you’re confident that the customer’s claim is invalid. What do you do? I recommend that you:

How Can Dating Sites Prevent Chargebacks?

The confluence of your monetization models and online-only presence means that you face unique risks. The fact that users expect outcomes even when you can’t guarantee them makes things even worse.

That’s why you need to practice vertical-specific chargeback prevention tactics. Specifically:

It’s common for dating site users to file chargebacks because your service “didn’t work.” After all, some people may receive exceedingly few matches, even when using a paid service.

That’s why your marketing, signup process, and terms of service must make it clear that you’re selling access to potential partners, and that there’s no guarantee users will find matches or dates.

In practice, this means shifting your language from guaranteeing results (e.g. “Find your soulmate”) to promoting features (e.g. “Access 10,000 verified profiles, “Get 20 free swipes a day”). If a user files a dispute, you can then more easily prove that you delivered the service as described, no matter their romantic success (or lack thereof).

So-called “subscription fatigue” and simple forgetfulness make recurring billing plans common targets for chargebacks. This risk is elevated for infrequent subscriptions. If users pay for a year of service upfront, it’s easy for a customer to forget they authorized the charge months ago, then be caught off-guard when they get the rebill.

To prevent these subscription disputes, you can’t rely on the initial signup agreement alone. Instead, proactively prevent them by sending renewal reminders a month, a week, and a day before the billing date.

In your reminder emails, state the exact renewal amount (and price changes, if applicable), the upcoming transaction date, the billing descriptor as it will appear on their statement, and a link that users can follow to manage or cancel the subscription.

When a user wants to cancel, they are often in one of two emotional states: frustrated they didn't meet anyone or happy because they did meet someone. In either case, a difficult cancellation process involving hidden links, mandatory phone calls, or complex forms may lead to retaliatory chargebacks.

And look, I get it: cancellations aren’t ideal. It’s understandable why you’d want to make it harder, rather than easier, to cancel. But then again, chargebacks are far worse than a cancellation. That’s why it’s better to play fair by making your cancellation process as easy as your signup process.

You can also avoid permanent cancellations by offering a “Hibernate” option. This allows users who have met someone to temporarily pause their subscription without churning, and it gives frustrated users the time they need to cool off, which may help you avoid costly disputes.

Freemium models are plagued with users seeking immediate and tangible results for their money. When paying for super likes still doesn’t result in a match, they may feel ripped off and file a chargeback.

To close this expectation gap, you need to be crystal clear about what the user is buying. Instead of a vague promise like “Get seen more,” quantify the service (e.g. “Get seen by 3x more profiles for 24 hours”) without using promissory language. Use a clear purchase confirmation pop-up and a checkbox with a hyperlink to your terms of service so that you have evidence the user understood and authorized the specific, non-refundable, in-app purchase.

The high-risk nature of your vertical means you’re a prime target for both friendly fraud and third-party scammers who use your site to create fake profiles and test stolen cards. The good news is there are a lot of tools at your disposal to stop third-party fraud and prevent criminal fraud chargebacks.

For instance, try implementing selective geographic blocking; if you only serve users in North America, block all transactions and signups from high-risk IP addresses in overseas regions. At checkout, deploy Address Verification Services (AVS) and use 3-D Secure 2.0, both of which can add a layer of security to your transactions. This can also shift the liability for fraudulent chargebacks from you back to the cardholder’s bank.

Even if you win a chargeback in representment, you’re still stuck with the chargeback fee. Plus, your chargeback ratio goes up. Chargeback alerts let you solve disputes before they morph into formal chargebacks.

These alerts services, like Ethoca Alerts and Verifi CDRN, intercept a customer complaint at the bank level and give you up to 72 hours to act. During this window of time, you can pre-emptively issue a full refund, effectively neutralizing the possibility of a chargeback. Although you still lose the revenue, you avoid the much larger chargeback fee and, critically, prevent the dispute from hurting your chargeback-to-transaction ratio.

Don’t Fight Dating Site Chargebacks Alone

Running a dating site, fielding customer service inquiries, and juggling unrealistic user expectations is a full-time job on its own.

As a merchant, it’s common not to have the time, bandwidth, or knowledge to tackle chargebacks by yourself. Given the tight response time limits for sellers, the constantly changing rules, and cryptic chargeback reason codes — which differ by card network — you could use some expert assistance.

At Chargebacks911®, our dual-layered, end-to-end chargeback management solution helps dating site merchants prevent and represent disputes, saving you time, money, and hassle.

Interested in learning more? Get in touch with us for a free, no obligation ROI analysis today.