4 ms·

loading across multiple providers won't alter the chargeback ratio so what is the point?

capableweb 6y ago
You could (in theory) do some risk analysis and put the ones with the highest risk into the providers where you had the lowest chargeback. Wouldn't be 100% solution, but could get you there.
- netsharc 6y ago
  I wonder if they do do that. In Germany there's a credit rating agency that more or less has a monopoly, and everyone has more or less a profile with data supplied by companies who've dealt with them commercially (e.g. if you signed a phone contract or opened a bank account). But sometimes their algorithm would also try to predict the chances of people not paying bills by things like the ZIP code where they live...
thomasedwards 6y ago
Stripe is cheaper than CCBill, so it makes sense to send more that way when you can.
Exuma 6y ago
Because MIDs also look at the total # of chargebacks and will do a manual flag review of your account, so they don't just look at the % ratio but also total number.
nasalgoat 6y ago
It spreads the chargebacks across multiple processors, who don't talk to each other so don't know about the chargebacks on the other processors.
- vehementi 6y ago
  That still does not affect the ratio
  - nasalgoat 6y ago
    The individual processors are the ones who care about chargebacks, not VISA itself. So by spreading the processing among several of them, the number of chargebacks per processor are lower. It's load balancing.
    - xuhu 6y ago
      Also lower is the number of transactions. The ratio stays the same.
      - nasalgoat 6y ago
        From my experience in the adult industry, the processor cared more about the total than the percentage.
    - deleted 6y ago
      [deleted]
    - Quarrel 6y ago
      This just isn't true. Yes, you can be pinged by the processor, but mostly because they're worried about the CC networks pinging them. Source: Have a 30M+ people site that has been pinged by VISA itself for chargeback ratios ...
  - sk5t 6y ago
    Maybe the confounding factor here is that the term "load balance" could be extremely unsuitable for onlyfans' processing logic; e.g. they might preferentially route the risky transactions to one or two processors that won't get too agitated/punitive.
    - pen2l 6y ago
      How is any given transaction distinguished as being risky or non-risky?
PeterisP 6y ago
You can direct most of the payments towards the cheap-but-prudish processors, and the really adult stuff towards a processor that accepts almost anything but is more expensive.
fooey 6y ago
Chargeback ratio's are per account, but also have a minimum absolute threshold. So it's say, 2% chargeback AND at least 200 chargebacks before penalties kick in. In a past life I worked for a place who had a few hundred processing accounts to load balance it all out because their chargeback rates were way too high. If an account gets close, you just don't use it for a month, or you throw a bunch of "safe" recurring charges at it to dilute it, or you hold a batch and send them through right before the rollover. Lots of ways to play number games. Most of the execs did go to prison though, so don't take this as advice, but to be fair, the processors are the ones who told them to use those tactics.
- folli 6y ago
  They went to prison for load balancing, or how does this relate?
  - thinkingkong 6y ago
    Gambling.
    - fooey 6y ago
      The business was just run of the mill "get rich on google" and "free government grant" garbage that was common in the 2000's. Ironically, they made so much money doing their regular business the owner bought a small US based bank and was running online poker processing through it. When "black friday" in the poker world happened, the bank failed and everything fell apart, but so far as I know, no one involved was ever charged with anything related.
  - fooey 6y ago
    The technical reason was bank fraud for all the shell corporations they set up in the process. The bank claimed they had no idea they were all related, even though every application had the owners name on the paperwork. To be clear, it was a bad company. However, the bank 100% knew what was going on and the merchant accounts 100% knew what was going on. So long as they were making money, and chargebacks make them a lot of money, they were happy. In my opinion the people running the company were just naive enough to not know how to cover their asses as well as the money guys.

You could (in theory) do some risk analysis and put the ones with the highest risk into the providers where you had the lowest chargeback. Wouldn't be 100% solution, but could get you there.

netsharc 6y ago
I wonder if they do do that. In Germany there's a credit rating agency that more or less has a monopoly, and everyone has more or less a profile with data supplied by companies who've dealt with them commercially (e.g. if you signed a phone contract or opened a bank account). But sometimes their algorithm would also try to predict the chances of people not paying bills by things like the ZIP code where they live...

thomasedwards 6y ago

Stripe is cheaper than CCBill, so it makes sense to send more that way when you can.

Exuma 6y ago

Because MIDs also look at the total # of chargebacks and will do a manual flag review of your account, so they don't just look at the % ratio but also total number.

nasalgoat 6y ago

It spreads the chargebacks across multiple processors, who don't talk to each other so don't know about the chargebacks on the other processors.

vehementi 6y ago
That still does not affect the ratio
- nasalgoat 6y ago
  The individual processors are the ones who care about chargebacks, not VISA itself. So by spreading the processing among several of them, the number of chargebacks per processor are lower. It's load balancing.
  - xuhu 6y ago
    Also lower is the number of transactions. The ratio stays the same.
    - nasalgoat 6y ago
      From my experience in the adult industry, the processor cared more about the total than the percentage.
  - deleted 6y ago
    [deleted]
  - Quarrel 6y ago
    This just isn't true. Yes, you can be pinged by the processor, but mostly because they're worried about the CC networks pinging them. Source: Have a 30M+ people site that has been pinged by VISA itself for chargeback ratios ...
- sk5t 6y ago
  Maybe the confounding factor here is that the term "load balance" could be extremely unsuitable for onlyfans' processing logic; e.g. they might preferentially route the risky transactions to one or two processors that won't get too agitated/punitive.
  - pen2l 6y ago
    How is any given transaction distinguished as being risky or non-risky?

PeterisP 6y ago

You can direct most of the payments towards the cheap-but-prudish processors, and the really adult stuff towards a processor that accepts almost anything but is more expensive.

fooey 6y ago

Chargeback ratio's are per account, but also have a minimum absolute threshold. So it's say, 2% chargeback AND at least 200 chargebacks before penalties kick in. In a past life I worked for a place who had a few hundred processing accounts to load balance it all out because their chargeback rates were way too high. If an account gets close, you just don't use it for a month, or you throw a bunch of "safe" recurring charges at it to dilute it, or you hold a batch and send them through right before the rollover. Lots of ways to play number games. Most of the execs did go to prison though, so don't take this as advice, but to be fair, the processors are the ones who told them to use those tactics.

folli 6y ago
They went to prison for load balancing, or how does this relate?
- thinkingkong 6y ago
  Gambling.
  - fooey 6y ago
    The business was just run of the mill "get rich on google" and "free government grant" garbage that was common in the 2000's. Ironically, they made so much money doing their regular business the owner bought a small US based bank and was running online poker processing through it. When "black friday" in the poker world happened, the bank failed and everything fell apart, but so far as I know, no one involved was ever charged with anything related.
- fooey 6y ago
  The technical reason was bank fraud for all the shell corporations they set up in the process. The bank claimed they had no idea they were all related, even though every application had the owners name on the paperwork. To be clear, it was a bad company. However, the bank 100% knew what was going on and the merchant accounts 100% knew what was going on. So long as they were making money, and chargebacks make them a lot of money, they were happy. In my opinion the people running the company were just naive enough to not know how to cover their asses as well as the money guys.