The dark side of returns and refunds

A flexible return policy is key to e-commerce success, but it can also open the door to fraud. Return fraud was rising even before the pandemic led to more online shopping, more buyer’s remorse and more friendly fraud. Now, there are also professional return fraudsters in the mix.
To balance the needs of customers with the need to prevent return fraud, it’s important for merchants to understand the scope of the problem they face now. Twenty percent of e-commerce refunds are fraud, at a cost to merchants of $24 billion per year. On the other hand, more than 80% of consumers are checking retailers’ return policies before they buy, according to Shopify, so return policies that are too strict will cause losses, too. Read more…