Originally published in September 2019. Last updated on March 25, 2025.
Have you ever charged a client’s credit card for a completed job only to have them dispute it? Even though you did the work, you might not get paid unless you fight the chargeback claim.
Chargebacks happen when clients forget, misunderstand, or don’t bother to read your payment terms—or when they aren’t clear enough in the first place. And they can cause major problems when it comes to your cash flow and profit margin.
Use these tips to prevent chargebacks so you can protect your service business and improve customer communication.
What is a chargeback?
A chargeback is when a customer’s bank reverses a charge you applied to their credit card. This happens when the charge is disputed, usually because a client:
- Doesn’t recognize the amount
- Doesn’t recognize your business name (like if your incorporation name is different than the name you do business as)
- Misunderstands your agreement
- Forgets the service took place
The only way to reverse a chargeback is to dispute it by providing proof to the customer’s bank that you completed the work the client agreed to. If you don’t have records and documents to back up your claim, you risk losing income.
Your best bet is to respond quickly since most credit card providers have strict limits about how long you have to resolve a chargeback dispute. For example, while most lenders allow up to 120 days for general chargebacks, the timeline can be half that if the client claims no work was done.
Even if the chargeback is reversed after you provide documentation, you may still lose profit on the job due to additional processing fees from your payment processor.
And if your business account receives too many chargebacks, it can be flagged as high risk, ending up in a terminated contract or higher processing fees from your bank.
Since fighting chargebacks can cause so many issues, your best bet is to implement best practices for chargeback prevention.
1. Provide detailed quotes and invoices
Quotes tell customers how much they should expect to pay for a potential job while invoices outline the total amount due after the job is completed.
If the cost of a job changes, whether due to scope, material costs, or unexpected labor expenses, make sure to discuss it with your client before proceeding.
For example, if you’re replacing damaged flooring in a client’s basement and the laminate they choose is more expensive than what you outlined in your estimate, you need to let them know before putting in an order.
By providing itemized quotes for each job, customers will have a clear idea of what to expect to pay when the job is done. But if pricing changes over the course of the job, and you communicate about any additional expenses, they’ll understand why they have a higher bill when it’s complete.
This helps to prevent chargebacks by keeping customers informed and up-to-date about pricing throughout the process. That way, they won’t be surprised or confused about the amount when it shows up on their credit card statement.
2. Get customer sign-offs
Whenever you send out a quote or make changes to the job scope, don’t just inform the client, get their sign-off before moving forward.
Quote approvals ensure clients understand the costs associated with a job, as do client confirmations when pricing changes.
Whenever possible, get the client’s signature (either a digital or physical version) on relevant documents. Not only will it keep you on the same page, but it will provide documentation in the event of a chargeback claim.
If a client tries to say you overcharged them, or that they weren’t aware of the costs, you can send a signed copy of the quote or change of scope to their bank to prove that you had their approval.
For situations where a signature doesn’t work, like a quick email or text to let them know the job will require more labor than anticipated, wait until you hear back from the client and keep a copy of their response.
That way, you’ll have some proof that they gave you the go-ahead.
3. Have clear payment terms
Payment terms outline important details about the financial aspects of your relationship with a client, like:
- When they have to pay you by
- Which payment methods you accept
- Whether you offer refunds
- Your cancellation policy
- Whether a deposit is required
- When or if late fees are applicable
Being upfront about these terms prevents miscommunications and sets clear expectations about payments, resulting in fewer chargebacks and disputes.
Take the time to review them with your client before the job begins so there’s no confusion about due dates, payment amounts, or policies. Then, reiterate them in your invoices as a reminder so you can reference them if a chargeback dispute arises.
4. Use payment processing software
Payment processing software like Jobber offers customers a secure and convenient way to pay their bills. Customers can pay invoices by entering their card details manually, using Google Pay or Apple Pay, making an ACH bank transfer, or on the spot with the Jobber Card Reader.
Plus, Jobber makes it easy to generate professional invoices complete with accurate job details that are ready to send to clients in one click. And automatic invoice follow-ups help remind customers to pay their outstanding invoices so you don’t have to chase down payments.
5. Collect customer details
Collecting detailed customer information shows banks that your records are accurate and up-to-date and that you have a relationship with the client.
Make sure to collect your client’s:
- Full name
- Billing and service addresses
- Phone number
- Email address
- Credit card type, number, and expiration date
- CVC (Card Verification Code)
Having the customer’s CVC means they provided it to you in advance of a payment. This makes chargebacks less likely because it ensures they’re aware they’ll be charged and that they’ve authorized a transaction.
But if a chargeback does happen, having a CVC on top of the customer’s contact information offers solid proof that they knew to expect a charge.
Pro Tip: If you want a client’s permission to bill their credit card, make sure to use a credit card authorization form. This provides confirmation they agreed to the charge and acts as a backup if they dispute it.
6. Bill clients quickly
Some chargebacks happen because service providers wait so long after a job, a client forgets it took place. The faster you bill a client after a job’s done, the less likely it is to slip their mind.
Ideally, you should send an invoice within 24-48 hours of a completed service appointment.
Then the service will be fresh, giving clients a chance to ask any questions or resolve any concerns before their card’s charged. As an added bonus, prompt billing also sets clear expectations for future work, preventing chargebacks in the short- and long-term.
7. Keep records
Having detailed records means providing clear and consistent communication and documentation from day one of your relationship with a client.
It’s an effective way to keep clients informed throughout the process, reducing the risk of chargebacks and payment disputes.
When possible, collect and file documentation of:
- Quote approvals
- Contracts
- Customer communications over text or email
- GPS data that shows your team was at the client’s property
- Payment authorizations
- Before and after images
- Payment records
- Receipts
- Service dates and times
- Any cancellations or refunds
Then attach it to the customer’s file so you can easily access it if they have a question or concern.
8. Train your team
If you aren’t the only one communicating about payments to clients, you need to train your team on how to answer questions and handle potential disputes.
Make sure they know how to answer customer questions about:
- Billing procedures
- Payment terms
- Refunds and cancellations
- Payment methods
- Service adjustments, like onsite discounts for delays or scope changes
It’s also helpful to have standard operating procedures (SOPs) for disputes and chargebacks so they have clear instructions to follow when they’re on their own.
Why do chargebacks happen?
In service businesses, chargebacks happen for a variety of reasons, including:
- Services not rendered: The client believes the work wasn’t completed.
- Billing disputes: The client thinks you overcharged them or the amount on their credit card statement is different from the amount on their initial quote.
- Unauthorized transactions: The client didn’t give you permission to charge their credit card.
- Quality of service issues: The client is not satisfied with the quality of the work or misunderstood the job scope.
- Poor communication: The client either didn’t receive, review, or understand your payment terms.
- Failing to send timely invoices: The client didn’t receive an invoice until long after the job leading to confusion about who is billing them and why.
- Fraudulent transactions: The client doesn’t recognize the charge and believes it may be fraudulent activity either because they forgot about the service, their card has been stolen, or they declined the service before it was completed.
The majority of chargebacks come down to poor communication between service providers and their customers.
From unauthorized transactions and canceled jobs to late paperwork and obscure payment terms, most payment disputes stem from confusion or misunderstandings.
By using field service management software like Jobber to streamline invoicing, track job details, and process payments, you can better prevent chargebacks and keep your customers satisfied.