Fintech ZEN offers solutions to reduce losses associated with chargeback procedures

Every two years, the number of chargeback procedures increases by 41% and it is estimated that this trend will increase even more with the development of e-commerce, says fintech company ZEN.

Last year, the financial impact of chargeback procedures reached over $ 30 billion globally. Of the total chargeback requests, it is estimated that 86% are associated with friendly fraud. Friendly fraud is a situation in which the buyer pays for the product online with a bank card, after which he submits a chargeback request to recover his money, for various reasons, but he can also keep the purchased product.

According to ZEN.com, one of the causes of the high number of chargeback requests is the fact that online stores do not inform their customers sufficiently, correctly and transparently about product return and refund policies. Less than 30% of European e-commerce platforms offer guarantees or return and refund policies, and this is one of the reasons why buyers resort to chargeback procedures, if something does not work as they want when they buy. on the Internet. The problems invoked by them include: duplication of a payment made, various delivery problems, mismatch of the product with the description on the website. Usually, the existence of a clear reimbursement policy prevents the unpleasant effects of such situations.

For example, the latest available data on European markets shows that between 41% and 64% of consumers consider it extremely important to have access to clear information on the return policy of a product purchased online. This reflects the fact that if the online store provides a customer support service through which a solution can be found (eg changing a product), the number of chargeback requests would be lower. “As far as traders are concerned, the chargebacks and costs associated with them can affect financial plans and budgets. In addition, such a procedure, in which the trader, the buyer and the bank are involved, also takes a long time to resolve. In short, a chargeback procedure in its current form can generate frustration for both the buyer and the trader “, explains Michał Bogusławski, Commercial Director of ZEN.com, the European fintech recently launched in 31 European markets.

ZEN takes over the handling of chargeback requests and the costs associated with them

“Chargeback is an endless source of frustration for online merchants. The money, time and effort invested in resolving chargeback requests or fraudulent activities could be used in a constructive way, a very important aspect when operating in a competitive environment. At the same time, buyers face delays and multiple formalities for resolving such a request, which increases their dissatisfaction with the purchase process, ”explains Michał Bogusławski, Commercial Director of ZEN.com. “That is why it is important to have a mechanism dedicated to solving an effortless chargeback request. It will allow both buyers and traders to deal with the desired activities with less stress. ”

European fintech ZEN offers such a solution: it covers all the additional costs that should be paid by the trader, while maintaining contact with the customer in order to solve his chargeback request. The company is also involved in the event of a dispute. Everything is included in the price of a monthly subscription. Such a solution benefits both parties involved in a transaction. Merchants can save time and money, and customers can recover their money easily and quickly. Online merchants eliminate worries about chargeback and can handle other priorities, and customers feel more secure when paying at any online store.