FASTTRAK Blog Articles

Chargeback Surge of 2022

 

 

 

The Great Chargeback Surge of 2022

 

Have you noticed an uptick in chargebacks? We are seeing many of our merchants who are experiencing chargebacks for the very first time after decades of business experience. As we enter the third month of 2022, our Aurora Payments chargeback assistance team has seen a huge surge in chargebacks. This is a phenomenon taking place throughout the world. In fact, it’s so prevalent that our industry has named it, The Chargeback Surge.

 

What’s Causing the Surge?

Surprisingly, we believe this is a side effect of the COVID-19 pandemic as the surge rates coincide with life changes that occurred in March of 2020 when our lives shifted in one way or another. The lockdown became a catalyst for digital commerce. From neighborhood restaurants who adapted to online ordering and curbside pickups to retail merchants who quickly embraced internet sales and added eCommerce to their websites. With the surge in eCommerce comes the surge in chargebacks. Americans are spending more time online and in a recent survey, six out of every ten consumers reported making at least two eCommerce purchases per month.

 

It's Everywhere

American merchants are not alone in seeing the chargeback surge. Card brands such as Visa and MasterCard report chargeback increases from three continents. 24% of all online shoppers in the United States, Australia and the United Kingdom have filed a dispute against a merchant in the past 12 months. 12% of this same group is initiating chargebacks at least once monthly.

 

How Big is the Problem?

It’s big! 48% of all merchants in the previously mentioned continents have experienced a 50% increase in chargebacks filed against them in the past 20 months. Every chargeback has a 50% chance of being won or lost by a merchant. If you lose a chargeback, you lose the funds and you are left without the product or the time you spent working on a paid project that you will never get back. Every chargeback defense means someone must gather the supporting documentation and take the time to respond to the chargeback notice and track it to the resolution.

 

 

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