Ecommpay, a global payment processor and card acquirer in the UK and Europe has introduced local acquiring services in the U.S. This initiative empowers merchants from the UK and EU to venture into the North American market. Furthermore, Ecommpay is offering a safeguard against chargebacks from fraud-related issues to ensure that merchants don’t suffer unnecessary losses of both time and money when faced with chargebacks.
Anticipated global cross-border payments are projected to reach $250 trillion by 2027, with the US playing a pivotal role in this landscape. However, the adoption of 3-D Secure (3DS) payments, which provide added security against fraud for merchants, consumers, and card issuers, remains optional in the US. In contrast, regulatory frameworks in the UK and Europe have mandated the use of 3DS to safeguard all stakeholders.
Based on insights from Ecommpay‘s data, the absence of 3DS verification results in fraud-related chargebacks, leading to a potential loss of up to 30% of sales in the US. This elevated chargeback rate adversely impacts merchants.
Ecommpay‘s data also highlights that merchants experience a loss of 1.7% in business turnover due to chargebacks originating from the US market. By availing of Ecommpay’s protection, this figure is reduced to a mere 0.5%. Ecommpay is now facilitating local acquiring for the US market through its fraud prevention and risk management solution to fortify its merchants and promote better industry practices. This comprehensive approach includes protection against all forms of fraud-related chargebacks.
This coverage shields merchants from diminished sales, fees associated with chargeback arbitration (which can reach up to $500 per case), escalated operational costs, and potential productivity setbacks. Ecommpay will assume the burden of merchant expenses via this insurance offering, incorporating only a modest supplementary fee with each transaction.
For instance, envision a merchant achieving sales surpassing $9,000,000 during the first half of 2023. Without Ecommpay‘s chargeback protection, this merchant would face a chargeback rate of approximately 4.3%, amounting to $387,574. By leveraging Ecommpay‘s safeguard against chargebacks, the merchant could potentially save around $342,574, equivalent to 3.8% of their total turnover.
Olga Karablina, Head of Payment Product Development at Ecommpay, underscores the significance of furnishing merchants with optimal and secure choices while expanding local acquiring networks. By delving into the intricacies of local markets and heeding the interests of both merchants and customers, Ecommpay is poised to extend its footprint to an increasing number of international markets. The recent announcement reflects this unwavering commitment, facilitating the expansion of UK and European merchants, as Ecommpay has already demonstrated in regions like LATAM, Asia, South Africa, and the Middle East.
