Online retailers are spending too much time and money dealing with card not present payments, a new study has found.
The survey, from payment processing company Chase Paymentech Europe found that as a result, customer service levels were being hit, with a corresponding knock-on effect on retailers’ ability to compete effectively.
Some 200 businesses were quizzed by Dynamic Markets in the survey. They found that 79% of financial directors thought their card not present payment capability had developed in a less than ideal way. That figure rose to 94% for large companies.
And some 68% of traders still relied on manual processing of card not present (CNP) transactions. For international payments that figure rose to 92%. That translates into 27.8 days a year spent dealing with the reconciliation of CNP payments. That means knock-on effects, says Chase Paymentech, for the ability of UK businesses to compete effectively.
And the shortcomings in CNP systems, more than a third of which (39%) had grown piecemeal, also had effects on customer service. If a customer had a problem during the checkout process, for example, merchants could not tell them why their card was declined and what to do about it. Finance staff at 87% of the companies questioned thought that manual reconciliation of CNP payments led to negative customer service.
Shane Fitzpatrick, president and managing director of Chase Paymentech Europe, said: “The results from the survey underline that merchants are not aware of the hidden costs connected with ecommerce. Most organisations outside of ecommerce are looking to cut overheads and become more streamlined.
“It is surprising that UK merchants are still opting to continue with manual reconciliation and patchwork payment systems.”