More Online Shopping Means More Disputed Charges

The past two years have seen a surge in eCommerce activity around the world, bringing with it a spike in the number of transaction disputes.

PYMNTS research shows that 39% of consumers across Australia, the U.K. and the U.S. — about 25 million people — report they are disputing more eCommerce transactions now than they did prior to March 2020, while just 21% are disputing fewer transactions.

The more consumers shop online, the more they initiate disputes, with as many as 47% of the consumers whose online shopping has increased since March 2020 say they also are disputing more eCommerce transactions than in the past.

Twenty-four percent of all eCommerce shoppers say they’ve disputed at least one online transaction in the past year, while 9.9% report disputing at least one transaction a month.

In Australia, that figure is a bit higher, with 28% saying they’ve disputed at least one eCommerce transaction in the last year, and 13% report disputing at least two transactions per month on average. This means around 4.2 million Australian consumers have disputed at least one charge in the last 12 months, and 2 million are disputing 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 an incorrect address or charging an incorrect amount for a transaction. Seventy-one percent of consumers in Australia, the U.K. and the U.S. report they disputed charges due to this type of error.

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

Twenty-nine percent of U.S. consumers who dispute transactions did so after becoming victim of fraud, while just 22% of Australian shopper and 12% of U.K. eCommerce consumers who have disputed charges in the last year did so because of fraud attempts.

Would you like to learn how eCommerce merchants are dealing with this rise in disputed charges? Download Tackling The Chargeback Surge, a PYMNTS and Ethoca collaboration.