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Friendly fraud and chargebacks are top issues for merchants, research finds

Monday 10 February 2020 13:59 CET | News

Chargebacks911 and Card Not Present (CNP) have revealed research on the state of chargebacks and chargeback management in relation to CNP payments.

The study, conducted on over 200 online, multichannel, and mobile commerce merchants, found that friendly fraud was the number one cause of chargebacks. 56% of all respondents reported an increase in the instances of friendly fraud over the past three years. 31% per cent of respondents suggest that identifying friendly fraud is their biggest challenge. Disputing chargebacks was listed as a close second at 29%.

Moreover, survey respondents that do not dispute chargebacks were asked why not, and their responses included a lack of sufficient resources and belief they couldn’t win any of their representments even if they tried.

82% per cent of merchants surveyed believed that Visa’s Visa Claims Resolution (VCR) had little or no impact on chargeback management, while 19% of merchants noted a decline in Visa chargebacks after VCR. 55% said they didn’t believe there was a decline. Visa also released a plug-in called Visa Merchant Purchase Inquiry (VMPI), which allows businesses to respond to cardholder inquiries and complaints before a chargeback is instigated and gives issuers more resources with which to respond to chargebacks. However, just 2% of merchants implemented VMPI. Also, despite the difficulty of managing chargebacks and adhering to new rule changes, most merchants don’t use third-party chargeback management solutions. 

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Keywords: merchants, chargebacks, management, CNP payments, third party, Visa, fraud, friendly fraud, Chargebacks911, Card Not Present
Categories: Securing Transactions | Digital Identity, Security & Online Fraud
Countries: World
This article is part of category

Securing Transactions