How to deal with your business refunds and returns?

Diego Katzman

Diego Katzman
Published 09/06/2021 · 3 min read

I placed an order online. I have received it at home, but it does not correspond to the features I had selected at the time of purchase. Can I request a refund? And if you are an eCommerce, how do you deal with online purchase returns?

A refund is a symptom that something has gone wrong with the customer's shopping experience. A refund from the merchant to the buyer may result from a defective product, a double charge or another reason. Fortunately, each online store can create its own returns policy and comply with a range of legal requirements set out in The General Law for Consumer Protection.

Do you receive requests for refunds and returns of online purchases daily? How do you deal with them in your eCommerce?

You will find the answer in this post. Join us, because it won't take you more than 5 minutes to learn something that can change the results of your online store forever.

Effective ways to manage online purchase returns

Increasing your online store's sales equals increasing the chances of returns, but how do you deal with them? Is there a way to reduce them? What are the options?

In the last year, online shopping has skyrocketed worldwide. Given that the chances of a product being returned are much higher in eCommerce than in physical stores, it is important to learn how to deal with refunds and returns.

The most effective way to deal with a return is to avoid it. And how to do it? With these simple tips:

  • Describe your products clearly and accurately. Did you know that around 65% of online purchase returns are due to description issues? (SoleCycle). It often happens in online clothing stores because the colour or texture is different, or because the size is not specified correctly. To avoid such problems, it is advisable to provide as much information as possible about the products and to offer quality images.
  • Make clear the return policy used in the store. Try to be as clear as possible, because more than half of your eCommerce consumers read the returns policy before purchasing your products. You should use simple language, highlight the most important points and be as flexible as possible.
  • Avoid chargebacks. In other words, setbacks or refunds happen when the bank requests a refund at the cardholder’s request. This happens because of the dissatisfaction with the charge. Some of the most recurrent chargebacks are: double charges, goods not received, fraud, return of the sale or defective products. Refunds can be operationally complex. To reduce these chargebacks, we recommend using a cascading method to redirect failed transactions to alternative payment methods and tokenization to increase user security and comply with the Payment Industry Data Security Standard.
  • Provide the right customer service. What's more, you should pay the same attention as if it were a sale, because often, the best customers are those who return the most products. And what better way to deal with returns than by trying to strengthen the bond with the consumer? Remember that there is no better advertisement than a satisfied customer.
  • Be clear in all customer communications. Regardless of the means, you must be clear and open in all communications, especially regarding issues related to refunds or returns. To keep them satisfied, you can offer alternatives.

Are your packages damaged? Is the product not working properly? Do you no longer need the product or service? Did you send the wrong product?

What the law says about refunds and returns

Returns are part of day-to-day life, so we have to learn to live with them. And during the pandemic, many businesses may have had to deal with more returns than normal, but no one can assure us that this situation will change. In fact, it's likely that the changes in eCommerce are here to stay.

The health crisis has impacted almost every aspect of daily life, causing uncertainty even in the payments industry. Being prepared, implementing the advice in this post and using a single payment platform is the most direct path to reducing it.

Let's see what the General Law for Consumer Protection says:

  • "It improves consumer protection in distance payments, especially concerning the right of withdrawal in purchases, extending the return period from 7 to 14 days."
  • "If the merchant has not obtained the consumer’s express consent but has inferred it by using default options which the consumer must reject to avoid additional payment, the consumer is entitled to a refund of that payment."
  • "Unless the merchant has offered to collect the goods himself, in sales contracts, the merchant may withhold the refund until he has received the goods, or until the consumer and user has provided proof of return of goods, whichever occurs first”.
  • "When the contract has been terminated, the merchant shall reimburse, without undue delay, all amounts paid by the consumer under the contract. In the event of an unjustified delay in reimbursement, the consumer may claim double the amount due, without prejudice to his right to compensation for damages over that amount".
  • "The refund of these amounts must be made without undue delay and, in any case, not later than 14 calendar days from the date on which you have been informed of the consumer’s and user’s decision to withdraw from the contract".

Do you need help reducing the level of fraud, refunds or returns of online purchases? Call us, at PayXpert we can help you without obligation.

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