Back in mid-May, Square quietly launched a landing page for a feature that helps small business owners create contracts that protect them from buyer chargebacks and other credit card disputes. It hasn’t publicly announced them yet, but in an interview, Square toldThe Vergewhy it launched these contracts, which will be promoted to business owners starting in August.

Kay Feker, Square’s risk program manager, noticed earlier this year that customers were increasingly asking for money back after a successful transaction. Even if they were satisfied with several home repairs, for instance, they would protest the final transaction and the business owner would have no real choice but to return their money as a result.

“These days with the increase in online purchases, you lose that sense of human interaction, so you’re more willing to send chargebacks along for all these purchases,” says Feker, explaining the uptick in transaction disputes over the last few years.

PayPal and Stripe. But it does offer sellers up to $250 of chargeback protection per month, so it’s likely that these contracts will help Square’s finances even indirectly. “We’re not looking to profit off this,” says Feker, “But we’re a business, too, so if the seller loses, Square loses as well. This insures we protect our relationship.”


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