Best Practices for Accepting Card Payments

With every card payment you take, you and your customer are entering into an agreement. This means that you can be held liable for the payment amount if your customer disputes the payment.

By following these guidelines, you’ll reduce the likelihood of facing a payment dispute and be more prepared if you do receive one.

Card-Present Transactions

Purchases made when your customer and their payment card are present are less likely to be disputed than a payment made remotely. Follow the practices below to minimise the risk of disputes when making card-present transactions.

Always insert or touch payment cards

If the card is physically present for a transaction, always use chip and PIN or Contactless with the Square Reader, Square Terminal or Square Register.

Confirm the Customer’s ID

When possible, ask your customer for a government-issued ID to confirm that they are the legitimate owner of the card being used.

Always Provide a Receipt

A receipt is a record of the transaction for both you and your customer. Providing a digital receipt can help a buyer recall what a charge was for. In the event of a dispute, we can use a receipt to challenge the dispute with the customer’s bank.

Card-Not-Present Transactions

With eCommerce or Virtual Terminal payments, naturally, the customer doesn’t have to be physically present. Since you can’t physically verify that the person making the transaction is the cardholder, we recommend taking the steps listed below to minimise the risk of payment disputes.

Obtain Card Information

Ask a customer to provide the card number, the name on the card, billing address, expiration date and CVV code on the back of the card.

Get Delivery Confirmation

If you are delivering a product, keep the tracking information and a delivery receipt. For large orders, require a signed confirmation of delivery.

Get Proof of Service

If you provide a service, document that it was successfully provided. For example, you can ask your customer to review and sign a work order and keep it for your records.

Contracts

With Square Contracts, you have the ability to create and send contracts right from your online Square Dashboard. The available contract templates are designed to be customised for your unique business needs – empowering you to establish clear agreements with your customers, secure digital signatures and help to avoid potential payment disputes.

Note: Square is not a law firm, a lawyer or a professional advisor in any industry. Square provides this template to individuals who choose to prepare their own contractual documents and does not constitute legal advice. See Square Contracts Terms and Conditions.

Know Your Customer

Get to know your customer before completing a large transaction. Verify your customer’s identity, billing address and business (if applicable) prior to processing a high-ticket item or sizeable order. Do a Google search or ask for a government-issued ID, and match the name on the ID to the name on the payment card.

Match Billing and Delivery Postcodes

If you’re delivering an item, check whether the billing and delivery postcodes match. If they don’t, ask why. The answer should make practical sense. If it doesn’t, don’t accept the payment.

High-Volume Payments

Multiple Transactions

If you’re processing multiple transactions for one item over a period of time, obtain a signature for each individual payment. In the item description, clarify that the payment is an 'instalment payment'. This ensures that you’re on the same page as your customer and protects you if they ever claim that any of the transactions were unauthorised.

Recurring Payments

If you have a recurring charge with a client, acquire written cardholder permission to periodically charge for the recurring services or goods. On the written agreement make sure to include:

• transaction amounts

• frequency of the charges

• the duration for which cardholder permission is granted

• the cardholder’s signature

If you wish to refund a payment, always issue the refund directly back through Square so it goes to the payment card. If you must provide a refund outside Square, make sure to obtain a signed agreement that your customer received the refund.

Never have your customer sign a statement waiving their right to dispute the transaction with the card issuer. This is a card network violation and will impact your chances of winning a payment dispute if one occurs. It’s better practice to set expectations with your customer and make sure they understand how transactions with your business work.

Large Transactions

All Square merchants have a per transaction limit of £25,000.

Service Charge

Merchants in the UK are responsible for adhering to all regulations regarding imposing a service charge on consumers when a card is used for payment.

Receipts

Add your contact information

Add your phone number, address, website and social media pages to your receipts. This will help a customer reach out to you directly if something goes wrong with a sale, rather than immediately filing a dispute with their bank.

Publish a refund policy

Add a refund or cancellation policy to your receipts.

Make your business name recognisable

Make sure the business name on your receipt is recognisable. This is the name that shows up on your customers’ bank statements. If a customer sees an unfamiliar business name on their statement, they may be more inclined to file a dispute.

If you don’t have a business name or your business name is longer than 35 characters, add a description of what you sell and your location to your business name. For example, if you are a taxi driver in Belfast, write Taxi – Belfast.

Note: From your Account Settings on your online online Square Dashboard or Square POS app, you can update your business and location business name. Your Business Name and Locations Business Name should not change often and can only be updated three times. Depending on the name change you are making, your account will be subject to review.

Write a description of the goods or services you sold

Provide an accurate description of what you sold for every transaction. This can help jog a customer’s memory and prevent a dispute from happening.

If writing descriptions for each transaction isn’t feasible for your business, create an item library. Then, when you process a sale, select the items or services sold and they’ll be added to the receipt.

Collect Customer Feedback

Use Square Feedback to collect comments from your customers about their purchase. If a customer has a problem with a sale, they can contact you directly from their digital receipt. You may be able to respond, issue a refund or resolve the issue without ever having to enter the dispute process.

Payment Disputes

Although following these guidelines can reduce your chances of facing a dispute, there is always a potential risk when accepting credit card payments. If a customer disputes a payment, Square will represent you in the dispute process free of charge and our team of specialists will use their expertise to help you along the way.

Learn more about the disputes process.

We also suggest that you familiarise yourself with how to protect yourself from scams and fraud.