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How Alternative Payment Methods Help Fight Chargebacks

Published on 03/29/2023 - Updated on 03/31/2023

Assorting your online business’s payment options may indirectly drop chargeback risks, enforcing your digital security strategy. Learn how we can help


As credit cards are the go-to payment method for online shopping, chargebacks pose a big challenge for merchants. A survey by Midigator estimates that chargebacks generally account for 2.31% of wasted profits every year, considering chargeback fees plus operational, marketing, product, and overhead costs.

However, the survey points out an expressive year-over-year drop in chargeback disputes, as noticed by other global watches. This is driven mainly by the e-commerce boom during the pandemic and associated shifts in digital security. But the growing popularity of Alternative Payment Methods (APMs) also plays a part in this outcome, notably in markets such as Brazil.


SEE MORE: Understanding Chargeback and Consumer Rights in Brazil


As in many developing, overpopulated countries, APMs are long established in Brazil as options that make up for the limited access to credit and the effects of social inequality, such as high rates of informal employment. In this post, you will learn how we leverage these payment methods to boost fraud prevention, conversion rates, and customer satisfaction, all while enforcing your business security strategy. Keep reading!


Alternative Payment Methods in Brazil: 5 Ways They Back Fraud Prevention


It is crucial to note that chargebacks do not apply to Alternative Payment Methods, which entail different compensation processes in case of fraud.

Either way, assorting your business’s payment methods may indirectly help drop chargeback risks. First, it allows your customers to choose from a more extensive set of payment options, some of which may be even more convenient. Second, most APMs in Brazil work as push payments (i.e., are initiated by the customer), hindering fraud attempts and ultimately sparing merchants from a costly, time-consuming process.

As their usage spreads, APMs help boost sales performance in multiple ways. At PagBrasil, we work with local payment methods to improve the customer experience while leveraging digital security uses. Learn more about our solutions and check 5 benefits of Brazilian APMs that might interest you:


1. Reach wider, more diverse audiences

Pix and boleto bancário come right after credit cards as Brazilians’ favorite APMs for online shopping. By catering to the local customers’ preferences, your business draws a broader set of audiences willing to pay upfront, driving conversions and predictable revenue.


→ Find out more about PagBrasil Pix and Boleto Flash®, our enhanced solutions for Brazilian payment methods


2. Allow discounts for each payment method in Shopify

Shopify merchants processing payments with PagBrasil benefit from additional features when using local APMs. At checkout, they can apply discounts for each payment method, making their customers’ APM of choice even more appealing.

This feature serves to boost promotional campaigns and tend to loyal customers, all the while warranting revenue at low risk for fraud.


3. Facilitate retries and cart recovery

Credit card payments may fail at any time for several reasons. When this happens, it is critical to act quickly and avoid losing a hard-won opportunity.

APMs come in handy at this point, and PagBrasil’s technology plays into that. Our integrations with major banks operating in Brazil automate retries for failed payments and make it easier to switch to Alternative Payment Methods. This feature is especially valuable for cart recovery strategies and business models based on recurring payments, such as subscription clubs.


4. Streamline recurrent payments

Speaking of subscriptions: research estimates that subscription clubs accounted for 1 billion BRL per year in transactions by the end of 2022. PagStream®, our subscription management feature, is designed to leverage this business model for the Brazilian market.

PagStream® enables recurring payments with Pix, boleto, and other Brazilian APMs. Customers can manage payment methods through the Subscriber Portal, where they can add two credit cards or select APMs for incoming charges. Merchants can also increase customers’ trust in the platform with PagStream® Premium, an exclusive plan with brand personalization features.


5. Count on anti-fraud solutions

PagBrasil’s solutions are protected by PagShield®, our anti-fraud tool based on machine learning. The feature is mandatory for credit card processing and may be signed up for other services, such as payment processing with APMs.

It is an intelligent way to prevent chargebacks and payment reversals for local payment methods, boosting conversion rates with .


Reach out to our specialists to know more about APMs

Choosing a specialized payment service provider is key to getting the most out of Alternative Payment Methods in Brazil. We provide multiple solutions for cross-border operations and payment security features and services.

It is worth saying that even though chargebacks compound a company’s default expenses, varying across industries and business models, they cannot be written off as routine losses. Contact us to know more and see how we can help your business grow safely!



Stefanie Cirne is a content writer experienced in news reporting, online content creation, copywriting, and social media management. Currently working... View profile

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