Connect with us

Global Banking and Finance Review is an online platform offering news, analysis, and opinion on the latest trends, developments, and innovations in the banking and finance industry worldwide. The platform covers a diverse range of topics, including banking, insurance, investment, wealth management, fintech, and regulatory issues. The website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website. .

Top Stories

Verifi Issues Eye-Opening Report Illustrating the Damaging Effects of Chargebacks

Verifi Issues Eye-Opening Report Illustrating the Damaging Effects of Chargebacks

 $31 Billion Chargeback Problem Facing Consumers, Merchants & Issuing Banks 

Verifi issued a new report that highlights the urgent need for collaboration between merchants, issuing banks and consumers. This in-depth analysis brings to focus the alarming scope and lasting effects that disputes and chargebacks present throughout the card payments ecosystem.

Verifi commissioned the report with Javelin Strategy & Research to examine the root causes of disputes, exploring how consumer behaviour changes based on experiences in the dispute process and the immediate, lasting and significant impact on merchants and issuers. The report found that consumer disputes and chargebacks created $31 billion in financial losses in 2017, with merchants bearing nearly $19 billion of the costs and issuing banks incurring the remaining $12 billion.

Entitled “The Chargeback Triangle,” the 36-page report provides a comprehensive view of the present chargeback lifecycle, as well as a detailed breakdown of the significant chargeback costs and negative impacts to issuers and merchants. More important, the report helps reveal opportunities to streamline the dispute process, and – in some cases – how to avoid chargebacks altogether.

Some key findings include:

  • Consumers reduce purchase behavior with a merchant by as much as 62% following a chargeback – and nearly two-thirds of consumers are more cautious about patronising merchants similar to the one with which the dispute occurred.
  • When the resolution process is drawn out, blame tends to shift toward the issuer that stands to lose top-of-wallet status and possible loss of consumer.
  • Consumers largely call the bank to initiate a dispute. Assessing friendly fraud risk can be a challenge for issuers, and both merchants and issuers agree that it has become too easy for consumers to dispute transactions.
  • Chargebacks can be prevented more than 80% of the time when the consumer contacts the merchant first with a dispute
  • For every dollar in a disputed transaction, merchants and issuers incur an additional $1.50 in costs, including technology, personnel, and external resources.

Matthew Katz, CEO at Verifi, stated, “Some of the findings can be hard to accept, but the report validates the innovation and services we provide are consistent with the need to help reduce the high and unnecessary costs that disputes and chargebacks create for all parties in the payments chain. The report clearly indicates that collaboration between issuers, merchants and consumers is critical to resolve disputes effectively and avoid the direct and extended costs chargebacks and consumer-initiated “friendly fraud” cause for merchant and issuers alike. In the end, the consumer pays the price in the form of higher purchase prices as well.”

Click here to obtain the research report, “The Chargeback Triangle.”

Global Banking & Finance Review


Why waste money on news and opinions when you can access them for free?

Take advantage of our newsletter subscription and stay informed on the go!

By submitting this form, you are consenting to receive marketing emails from: Global Banking & Finance Review │ Banking │ Finance │ Technology. You can revoke your consent to receive emails at any time by using the SafeUnsubscribe® link, found at the bottom of every email. Emails are serviced by Constant Contact

Recent Post