Justt: 'friendly fraud' reaches high Levels for US and UK Retailers

Thursday 21 July 2022 10:51 CET | News

Israel-based Justt has published a new survey, which reveals that more than 60% of consumers used chargebacks and refunds to reverse transactions.

The Justt Customer Attitudes Towards Chargebacks in 2022 survey shows that both UK and US consumers now routinely rely on chargebacks to vent dissatisfaction with the products and services they receive. American shoppers were markedly more aggressive than British consumers in their use of chargebacks across all industry verticals, and were also more likely to file serial chargebacks, with 15% of respondents filing five or more disputes in the past year. In the UK, about one in 10 shoppers filed three or more chargebacks over the past 12 months.

Some industries are especially vulnerable, with half of US respondents saying they had filed a chargeback for online or mobile game purchases. COVID-related disruptions also impacted the travel and entertainment industry, with 36% of US consumers and 16% of UK shoppers saying they had used chargebacks to dispute travel and entertainment-related purchases.

Moreover, consumers in both countries are also increasingly engaging in chargeback activism, with a remarkable 44% of US consumers saying they had used or considered using chargebacks to punish companies whose values differed from their own. 

New payment technologies have only fueled the ‘friendly fraud’ problem, the survey found, with more than 6 out of 10 US consumers who use Buy Now, Pay Later (BNPL) services saying they had used refunds or chargebacks to reverse BNPL transactions over the past 12 months. Crypto also has a chargeback problem, with a quarter of US crypto buyers filing chargebacks.

How can retailers respond to the threat of friendly fraud? 55% of customers stated that a generous returns policy would make them less likely to pursue a chargeback. In the UK, 60% said the same. But the survey makes clear that returns policies and customer service alone aren’t the solution to the chargebacks: companies also need a comprehensive and scalable solution to help them manage chargebacks and file accurate disputes in a timely manner, as per the press release.

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Keywords: BNPL, chargebacks, friendly fraud, survey, refund, cryptocurrency
Categories: Payments & Commerce
Companies: Justt
Countries: United Kingdom, United States
This article is part of category

Payments & Commerce


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