eCommerce continues to grow rapidly worldwide. Over the past year, regions such as Latin America and the Middle East/Africa have recorded increases of 16% and 13%, respectively, surpassing more established markets like North America (10%) and Asia-Pacific (8%), according to Atlantico. While driving economic growth, this expansion also increases fraud and payment disputes, necessitating technological solutions for improved security and efficiency in online transactions.
The impact of payment disputes on the industry
Payment disputes arise when consumers contest transactions, citing unauthorized charges, non-receipt of products, or other reasons. This process involves multiple parties (customers, banks, card networks, payment processors, and merchants), leading to higher operational costs. If the dispute is approved, the transaction amount is refunded through a chargeback, directly impacting businesses’ cash flow.
While chargebacks play a crucial role in consumer protection, their high frequency can undermine profitability and brand reputation. As a result, integrating advanced technologies has become a strategic necessity to streamline dispute resolution.s. These methods are vital for businesses competing in the digital economy.
Key causes of disputes and challenges faced by businesses
Despite the rise of alternative payment methods, such as instant payments and digital wallets, credit cards remain one of the most widely used payment options in global eCommerce. However, this popularity also makes them a prime target for fraudsters.
Data theft: Fraudsters create fake websites to steal consumers’ banking and personal information
Account hacking: Cybercriminals access leaked credentials to make unauthorized purchases
Fake listings: Scammers advertise non-existent products at attractive prices to lure victims
Fake payments: Fraudsters manipulate payment confirmations to deceive sellers into releasing goods before the payment verification
Another issue is “friendly fraud,” where customers dispute legitimate purchases — sometimes due to forgetfulness, unauthorized use by family members, or buyer’s remorse.
For merchants, the key challenges in this landscape include:
High operational costs: Due to the need for specialized teams and fraud prevention solutions
Short response deadlines: Typically ranging from 7 to 45 days to contest chargebacks
Financial and reputational risks: Fines and potential service restrictions if chargeback rates exceed acceptable thresholds
Using technology as an ally in dispute resolution
The increasing sophistication of fraud schemes demands that businesses invest in innovation to mitigate risks and optimize dispute management. Juniper Research projects that global eCommerce fraud losses will surge from $44.3 billion in 2024 to $107 billion by 2029, a 141% increase.
To address these challenges, artificial intelligence (AI) and machine learning have become invaluable tools for real-time detection of suspicious transactions and fraud prevention. Furthermore, these technologies facilitate automated evidence collection to expedite dispute resolution processes and lower operational costs.
Enhancing payment dispute management with ACI Worldwide
Another innovative approach is the orchestration layer, which integrates various payment systems, improving communication between banks, acquirers, and merchants. The ACI-RS2 dispute portal was designed to streamline dispute management and reduce operational costs. Its key features include:
Automated dispute processes: Reduces manual intervention by automating data exchanges and workflows, lowering labor costs and processing times
Centralized data management: Provides a detailed, intuitive dashboard that consolidates chargeback data, allowing users to resolve cases quickly
Optimized workflows: Simplifies the creation and submission of dispute and chargeback responses, ensuring a more efficient resolution process
Real-time updates: Receives instant notifications on dispute progress and outcomes, enhancing transparency and case management.
Advanced fraud prevention: Incorporates real-time fraud management capabilities, including machine learning and predictive analytics, to reduce risks and costs associated with fraudulent disputes
Together, these capabilities enhance operational efficiency and can potentially generate cost savings of up to 38.5% for organizations utilizing the ACI-RS2 dispute portal.
Move towards a more secure eCommerce landscape
With the growth of global eCommerce, a strong payment system is crucial. Modern solutions to prevent fraud and manage disputes are vital for businesses to stay competitive. The industry will increasingly depend on companies’ ability to balance innovation, security, and consumer protection. Technology is the key to a faster, more reliable, and better-prepared eCommerce ecosystem in the face of digital economy challenges.
Vlademir Santos is Head of Brazil at ACI Worldwide and an expert in financial transaction systems, with more than 30 years of experience in leading companies in the sector.
Ljiljana Krickovic
Product Owner, RS2, a global payment processing company and technology provider.
For more than 15 years, Ljiljana Krickovic has worked for global payment service providers and the largest financial institutions. Her experience spans product development, business analysis, and consulting for clients in several markets, including Eastern Europe, the Middle East, and Africa.
Vlad brings nearly three decades of experience in strategic consulting and innovation, acquisition of business partnerships, development of opportunities, design and implementation of solutions in the financial and payments industry to his role at ACI, leading business development within the LATAM region.
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