Ecommpay announces US local acquiring with chargebacks insurance

Tuesday, Aug 15, 2023 0

Ecommpay, a leading international payment service provider and UK and European direct bank card acquirer, now offers local acquiring in the US, enabling UK and EU merchants the ability to expand into North America. Additionally, Ecommpay will offer protection from fraud-related chargebacks to ensure merchants do not lose valuable time and money when those chargebacks occur.

Cross-border payments are set to reach $250 trillion globally by 2027, with the US being a key market player. However, 3-D Secure (3DS) payments, which provide extra fraud protection for merchants, consumers and card issuers, remain optional in the US. In contrast, UK and European regulations have made 3DS mandatory to protect all parties.

Based on Ecommpay data, It is estimated that the lack of 3DS validation results in fraud-related chargebacks, which in turn result in a loss of up to 30% of sales in the US, increasing the rate of chargebacks affecting merchants.

Ecommpay data also indicates that merchants lose 1.7% of their business turnover due to chargebacks from the US market. With Ecommpay’s protection, this is reduced to 0.5%.

To protect its merchants and encourage better industry practice, Ecommpay now offers local acquiring for the US market with its fraud prevention and risk management solution, adding its own protection from all fraud-related chargebacks. This will secure merchants from the risks of low sales, chargeback arbitration fees (up to $500 per case), increased operational expenses, and potential time lost. Through this insurance offering, Ecommpay will cover all merchant expenses with only a small additional fee attached to each transaction.

For example, a merchant generating sales of over $9,000,000 in the first six months of 2023 would have a chargeback rate of around 4.3% or $387,574. However, with Ecommpay’s chargeback protection, the merchant would be able to save approximately $342,574, or 3.8%, on their overall turnover.

Olga Karablina, Head of Payment Product Development at Ecommpay comments:

“Providing the best, most secure options for our merchants is key when expanding our local acquiring reach. This move is part of our broader strategy to protect our merchants profits and put in place new measures that encourage long-term growth.

This is not without its challenges. Mitigating the conversion issues when it comes to cross-border payments for our merchants has been tricky, but with our insurance for fraud-related chargebacks and our local acquiring abilities, we continue to set the benchmark within the payment’s industry.

By understanding local markets and the interests of our merchants and customers, we remain on track to expanding Ecommpay’s presence to more and more international markets. Today’s announcement is a reflection of this commitment, helping UK and European merchants expand as we have already demonstrated in LATAM, Asia, South Africa and the Middle East.”