The Shifting Role of a Chargeback Analyst

“A computer would deserve to be called intelligent if it could deceive a human into believing that it was human.” — Alan Turing

AI has been increasingly embedded into our daily lives; from smartwatches that tell us our heart-rate while we work out, to Alexa reminding us that we need to get milk. Artificial intelligence is not the science fiction mystery humanity feared only a few decades ago; today it lives amongst us, even within us, in every aspect of our lives. It’s no wonder that AI plays a critical role in today’s (and tomorrow’s) economy.

At Justt, we utilize AI to revolutionize an archaic aspect of the financial system – credit card chargebacks. Also known as credit card disputes, chargebacks were created in the early 70s as a way to protect cardholders. If a cardholder notices a suspicious transaction on their credit card bill, they can contest it. Of course, not all chargebacks are legitimate. Dishonest players looking to take advantage of the system open fraudulent credit card disputes, and naive consumers incorrectly open disputes for the wrong reasons, such as forgetting they or somebody from the household made a purchase (friendly fraud), or forget to ask for a refund directly from the merchant instead of opening a dispute. As the world shifts toward eCommerce, higher volumes of transactions across different geographies lead to increasing numbers of chargebacks worldwide, including a majority of which are illegitimate chargebacks. 

Illegitimate chargebacks are an enormous challenge for merchants, who often lack the resources or know-how to dispute them, and even when they do, success rates are typically poor due to generic solutions being applied across different use cases. The dispute process is labyrinthine and humans are not naturally good at keeping track of the many criteria that compose a dispute – ever-changing card-scheme rules, dispute letter format criteria, chargebacks and reason codes, time limits through the different chargeback stages and many other parameters.

Despite these challenges, many merchants employ (either directly or through third parties) teams of chargeback analysts responsible for manually handling the arduous dispute process. The chargeback analyst role is typically characterized as an entry level job with a low barrier of entry. Their profiles are often students, or people fresh-out-of-college with basic financial knowledge who are trying to get their foot into the very competitive fintech & financial services ecosystem. These analysts do the best they can in an exhausting role with high attrition rates. 

While humans may find the repetitive and detail-oriented dispute process difficult, artificial intelligence thrives with tasks of this nature. AI can be tailored to specific merchants and industries, which allows it to account for nuances between different classes of disputes in a way that a human using a generic solution simply can’t. AI is also infinitely scalable. Unexpected increase in disputes? No problem, AI can simply spin up more servers to handle the increased traffic. There is no need to hire and train additional chargeback analysts.

As in many industries in which AI is driving new job requirements, so too the role of chargeback analyst must evolve. While analysts of today are responsible for executing the dispute process, analysts of tomorrow will be skilled overseers with deep domain knowledge. They will be responsible for ensuring that AI driven solutions are properly integrated with the other systems, have access to the correct data sources and are meeting a high bar for dispute success rates. It wouldn’t be surprising if we begin to see certifications for chargeback analysts become an industry standard in the coming years.

This deepening and potential certification of analysts’ skills along with the maturation of AI technology in the chargeback space will lead to a shift in the career prospects and employment patterns of people in the industry. There will be fewer jobs for college students or uncertified recent grads to cut their teeth on, but there will be a longer career trajectory with more room for advancement and higher pay for those who do break into the industry. Analysts with a strong propensity to learn new skills as well handle the training data for the machine learning algorithms will become valued team members.

If we look at other, similar niches that have made the transition to AI, such as fraud prevention, we see this shift in the job description of human roles. A major change that occurred for fraud analysts has been the increasing need for knowledge of a programming language like Python that can be used to wield and shape data.

In chargeback mitigation, like with fraud prevention, the machine will be able to handle the vast majority of the cases that were once handled by junior analysts, but it will require constant training to handle more difficult cases or adapt to the requirements of new industries and new merchants. It is this increasing technical complexity of the solution and greater depth of human expertise that will transform the problem of chargebacks into one that is simpler to resolve for merchants through AI chargeback management.

Justt is the world leader in building customized chargeback mitigation solutions powered by artificial intelligence. We are proud of having the highest win rates in the industry with a best in class pricing model. If you would like to learn more about how Justt can help you save time and money, get in touch or sign up for a demo.

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    Chargebacks per month

    • Under $5,000
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