Worldpay introduced what it called a “first-of-its-kind service” capable of delivering near-instant refunds.
The refunds — the speed of which depends on the receiving financial institution — are designed to help close the gap between consumer expectations and merchant capabilities, the company said in a Wednesday (Nov. 27) news release provided to PYMNTS.
“Under many systems, refunds can take days to reach consumer accounts,” the release said. “Worldpay research shows 40% of consumers expect a refund within 24 hours when making a return and now this could be a reality for shoppers with refunds coming through within minutes.”
Retailers that employ the faster refund service can boost their overall customer experience and satisfaction levels, leading to better retention rates and cost efficiency through reduced refund-related queries, according to the release.
The new capability is available to most U.K. shoppers using Mastercard and Visa cards when buying from participating retailers, including HMV. Consumers who make eligible returns can get near-instant refunds when returning items for online purchases.
“U.K. consumers can pay for goods and services instantly, however, refunds have not kept pace with that level of immediacy,” Mastercard Head of Transfer Solutions Alan Marquard said in the release. “Leveraging Mastercard Move’s money movement capabilities, we are supporting Worldpay to increase the speed of refunds to some of the U.K.’s most well-known brands, giving shoppers greater peace of mind and helping retailers offer a first-rate service.”
Anastasia Serikova, vice president of revenue and growth at Visa Direct EU, said in the release: “As leaders in card issuance, it is our responsibility to work across the entire ecosystem to drive innovation and change… Consumers want their money to move faster — whether sending or receiving funds — together we’re delivering a positive change in how refunds are done.”
Beginning next year, Worldpay will also offer the service to merchants throughout the European Union for online and point-of-sale transactions.
The PYMNTS Intelligence report “How Instant Payments Help Consumers Receive Overpayment Disbursements Faster” found that consumers want faster refunds, especially for overpayment disbursements. About 71% of consumers receive some form of refund disbursement, with the average payout being about $68. The average disbursement amount is $433.