Monica Eaton, CEO of Chargebacks911, was recently featured in Digital Commerce 360 discussing the findings of the company's latest Chargeback Field Report and the growing impact of friendly fraud on online retailers. The article explores how merchants are increasingly turning to artificial intelligence and data-driven dispute management strategies to combat invalid chargebacks while preserving the customer experience.
The feature examines the evolving retail payments landscape, where friendly fraud has become a significant source of revenue loss despite continued advances in fraud prevention technology. Drawing on insights from Chargebacks911's research, the article explains that merchants must now balance stronger fraud controls with the need to reduce false declines and maintain a seamless checkout experience as digital commerce continues to evolve.
“Friendly fraud has moved from being a back-office inconvenience to a material business risk,” Monica said. “It is influencing pricing, customer policies, staffing decisions and the economics of digital commerce. The problem is growing faster than many merchants’ ability to identify, measure and manage it.”
According to the article, Chargebacks911's research highlights how AI-powered analytics can help merchants identify dispute patterns, distinguish between true criminal fraud and first-party misuse, and improve representment strategies. Rather than relying solely on reactive measures, retailers are increasingly investing in proactive technologies that strengthen communication, streamline evidence collection, and reduce unnecessary chargebacks before they occur.
Looking ahead, Eaton emphasized that technology alone will not solve the problem. “Chargebacks rarely cost merchants only the value of the original transaction,” Eaton said. “Once all factors are considered, the financial impact can multiply quickly and honest customers ultimately absorb part of that burden through higher prices or stricter policies. Refund abuse adds even more pressure by exploiting the customer-friendly processes merchants put in place to prevent disputes.”
