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How technology is transforming retail banking: self-service dispute resolution

How technology is transforming retail banking: self-service dispute resolution | EasySend blog
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5 minutes

The world of retail banking is undergoing rapid transformations, thanks to the integration of technology and innovative practices. One area that has seen significant advancements is credit card dispute resolution, commonly known as chargebacks.

Traditionally, chargeback resolution has been a time-consuming and costly process for financial institutions. Administrative fees, labor costs, non-recoverable losses, investments in technology, and compliance and risk management contribute to the substantial expenses associated with resolving credit card disputes. Furthermore, the manual nature of traditional dispute resolution often leads to inefficiencies and delays, negatively impacting customer satisfaction.

Credit card dispute resolution can be costly for financial institutions. A 2020 study by the Aite Group estimated that the total cost of chargebacks to financial institutions in the U.S. was $2.3 billion, with the average cost per chargeback estimated to be around $80.

[.figure]$2.3 billion[.figure]

[.emph]the total cost of chargebacks to financial institutions in the U.S. in 2020[.emph]

The costs incurred by financial institutions in the credit card dispute resolution process, or chargebacks, involve several factors:

  1. Administrative fees: Financial institutions pay fees to credit card networks (Visa, Mastercard, etc.) for processing chargebacks. These fees can vary depending on the network and the complexity of the case, typically ranging from $20 to $100 per chargeback.
  2. Operational costs: Financial institutions must dedicate staff and resources to manage chargebacks. This includes customer service representatives who handle dispute inquiries, fraud investigation teams that evaluate the validity of the dispute, and accounting personnel who process refunds or adjustments. The labor costs associated with these tasks can be significant.
  3. Losses due to non-recovery: In cases where a financial institution cannot recover the funds from the merchant, the bank may incur losses. This can happen if the merchant is insolvent or if the chargeback amount exceeds the merchant's reserves.
  4. Systems and technology: Financial institutions may invest in systems, software, or third-party services to manage and track chargebacks more efficiently. These investments can help reduce operational costs and improve the overall chargeback management process, but they require initial and ongoing expenses.
  5. Compliance and risk management: Banks must ensure they comply with card network regulations and maintain a low chargeback rate to avoid potential fines and penalties. This may involve additional costs for risk management and compliance efforts.

Financial institutions are continuously seeking ways to reduce the costs associated with chargebacks while enhancing customer satisfaction. Self-service data collection is emerging as a game-changer in reducing the cost burden on banks and streamlining the dispute resolution process.

The Self-Service Data Collection Solution

Self-service data collection enables customers to submit information relevant to their disputes through user-friendly online platforms, mobile apps, or automated phone systems. This innovative approach has the potential to revolutionize the dispute resolution process by streamlining data collection and reducing costs for banks. The benefits of self-service data collection in dispute management include:

  1. Reduced labor costs: By allowing customers to submit information directly, banks can significantly cut down on the labor costs associated with handling disputes. Customer service representatives can focus on more complex cases or other high-priority tasks, leading to increased efficiency and reduced costs.
  2. Faster dispute resolution: Self-service data collection accelerates the resolution process by eliminating the need for back-and-forth communication between customers, merchants, and banks. This results in quicker resolutions, benefiting both customers and financial institutions.
  3. Improved accuracy: When customers input their information directly, the chances of human error in data entry are minimized. This leads to more accurate and reliable data, ultimately enhancing the quality of dispute investigations.
  4. Enhanced customer satisfaction: Self-service data collection empowers customers to take control of their disputes and submit information at their convenience. This not only reduces the burden on bank employees but also improves customer satisfaction, as they can quickly initiate the dispute process without waiting for assistance.
  5. Streamlined compliance and risk management: With self-service data collection, financial institutions can more efficiently monitor and manage chargeback rates, ensuring compliance with card network regulations. This streamlined process reduces the risk of fines and penalties associated with high chargeback rates.

The integration of self-service data collection in credit card dispute resolution is proving to be a win-win situation for both banks and customers. By streamlining data collection and reducing costs, banks can focus on enhancing their services, while customers benefit from faster and more efficient dispute resolutions. As technology continues to reshape the banking landscape, self-service data collection is poised to play a pivotal role in revolutionizing the way financial institutions handle credit card disputes, ultimately reducing the cost burden and improving customer satisfaction.

EasySend: Customer Streamlining Data Collection in Retail Banking

EasySend’s innovative platform enables customers to submit their information directly, reducing the burden on bank employees and streamlining the dispute resolution process. The benefits of EasySend’s data collection solution include:

  1. Seamless integration: EasySend can be easily integrated with a bank's existing systems, enabling financial institutions to rapidly deploy self-service data collection without the need for extensive overhauls or additional infrastructure.
  2. Customizable forms: EasySend allows banks to create and customize digital forms for dispute resolution, ensuring that customers provide all the necessary information in a structured and efficient manner. This not only speeds up the resolution process but also enhances the quality of the data collected.
  3. Advanced analytics: With its built-in analytics capabilities, EasySend enables banks to gain valuable insights into customer behavior, dispute patterns, and chargeback trends.

Self-service data collection is transforming the way financial institutions handle credit card disputes, leading to cost savings and improved customer satisfaction. EasySend’s innovative platform enables banks to quickly deploy self-service data collection solutions with seamless integration and customizable forms.

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About EasySend

Evolve complex forms into easy digital experiences with EasySend, trusted by Fortune 500 financial organizations. Our powerful no-code platform revolutionizes complex forms, seamlessly converting data collection processes for loan applications, account openings, and chargebacks into effortless digital experiences.

About EasySend

Transform the entire policy lifecycle, from quote to renewal, with EasySend. Trusted by Fortune 500 insurance companies, our no-code platform revolutionizes data collection processes. Effortlessly capture customer information, generate quotes, facilitate policy applications, streamline claims management, and simplify policy renewals to deliver a seamless, user-friendly experience.

Vera Smirnoff
Vera Smirnoff

Vera Smirnoff is the demand generation manager at EasySend. She covers digital transformation in insurance and banking and the latest trends in InsurTech and digital customer experience.