Online shopping

More online purchases, more disputed charges

The past two years have seen an increase in e-commerce activity around the world, leading to an increase in transaction disputes.

PYMNTS research shows that 39% of consumers in Australia, the UK and the US – around 25 million people – say they dispute more e-commerce transactions now than before March 2020, while only 21% dispute fewer transactions.

The more consumers buy online, the more they initiate disputes, with up to 47% of consumers whose online purchases have increased since March 2020 also say they dispute more e-commerce transactions than in the past.

Twenty-four percent of all e-commerce shoppers say they have disputed at least one online transaction in the past year, while 9.9% say they dispute at least one transaction per month.

In Australia, the figure is somewhat higher, with 28% saying they have disputed at least one e-commerce transaction in the last year, and 13% say they dispute at least two transactions per month on average. This means that approximately 4.2 million Australian consumers have disputed at least one transaction in the last 12 months, and 2 million dispute at least one transaction per month.

Online shoppers report several reasons for disputing charges, the most common being service errors, such as a merchant sending a package to the wrong address or charging the wrong amount for a transaction. Seventy-one percent of consumers in Australia, the UK and the US say they have disputed charges due to this type of error.

Our research found that 86% of Australian e-commerce buyers who disputed at least one charge in the last year did so because of a service error. Australian buyers were also the most likely to dispute the charges simply because of confusion about some aspect of their transaction.

Twenty-nine percent of US consumers who dispute transactions did so after being victimized by fraud, while only 22% of Australian shoppers and 12% of UK e-commerce consumers who disputed charges over the past last year did so due to attempted fraud.

Would you like to know how e-commerce merchants are handling this increase in disputed charges? Download Tackling The Chargeback Surge, a collaboration between PYMNTS and Ethoca.

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