Return of funds on a credit card — this is a financial operation during which funds previously debited from a client’s credit account again appear on his account. This process includes several participants: cardholders, issuing banks, merchants, and payment systems. In the United Arab Emirates (UAE), the procedure of return is regulated by strict laws. These rules are important both for card owners and for merchants and are observed according to recommendations of the Central Bank of UAE. If you plan to open bank account online UAE, it is important to understand how the return process works.
Page content
Main reasons for initiating return of funds
- Errors in transactions: For example, duplication of debits can happen in 1 out of 50,000 transactions according to industry statistics.
- Discrepancy of goods or services: According to research, about 30% of online purchases are returned by customers.
- Fraud: According to data for 2023, about 5% of all transactions can be potentially fraudulent.
- Order cancellation: Studies show that up to 15% of internet orders are canceled by customers.
Stages and participants of the return process
- Initiation of return: Client contacts issuing bank and explains the reason.
- Investigation: Bank studies the request, collecting information from merchant.
- Communication with merchant: Merchant is given opportunity to prove legitimacy of transaction.
- Decision: Bank makes decision based on collected information.
- Final return: If the request is justified, funds are returned to the client within 7 to 14 days.
Regulations and security: how UAE protects consumers
- Consumer rights protection: Central Bank of UAE requires a thorough check of each application. More about this can be found on page of consumer rights protection.
- Duties of merchants: Transparency of information and compliance with return rules.
- Established deadlines: Laws set clear time frames for processing return requests.
Impact of returns on merchants and cardholders
- Financial losses: Frequent returns can significantly reduce the profit of merchants, especially due to fees.
- Deterioration of reputation: According to studies, negative effect from bad reviews seriously affects reputation.
- Risks for cardholders: Frequent unjustified returns can lead to sanctions from bank.
How to minimize the risk of unjustified returns
- Staff training: Conduct training on the topic of working with payments and customers.
- Transparent information: Ensure accuracy of data on goods and services.
- Technological security: Implementation of two-factor authentication can reduce the number of frauds by 50%.
Successful cases and practical examples in UAE
- Solution of payment duplication: In a large bank in Dubai, a client discovered duplicated debit. The request was resolved within 7 days.
- Settling problems with goods: In online store client discovered defect in electronic equipment. Return was made within 14 days after request.
General recommendations for cardholders and merchants
Tips for cardholders:
- Check account statements for suspicious transactions.
- Keep documents confirming purchases for possible returns.
Tips for merchants:
- Train employees in proper handling of payments.
- Create transparent channels for resolving customer complaints.
Effective management of return of funds on a credit card — this is an important aspect for ensuring financial security and customer satisfaction. Considering all aspects of this process, you can minimize risks and protect the interests of all parties.
Leave a Reply