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September | 2021
Online purchases are on the rise, and with them, so are fraud and disputed payments. Historically, disputed payments were viewed as simply a cost of doing business, and management of these payments received little investment in terms of technology and resources. But with the rising use of digital payments, more than 80 percent of dispute chargebacks are now fraud-related. As fraudulent charges continue to grow (chargeback disputes will grow from $23 billion in 2018 to $35 billion by the end of 2021), financial-services companies can no longer deny the increasing importance of dispute management.
Fortunately, advances in technology make it possible to manage disputed charges as part of an integrated digital strategy. And the technology has improved to the point where AI and automation can perform a good deal of the heavy lifting. These technologies make it possible to manage the disputed charges quickly and improve the customer experience in these dispute journeys.
Fortunately, advances in technology make it possible to manage disputed charges as part of an integrated digital strategy. And the technology has improved to the point where AI and automation can perform a good deal of the heavy lifting. These technologies make it possible to manage the disputed charges quickly and improve the customer experience in these dispute journeys.
Why Build Dispute-Management Capabilities?
Three main drivers are compelling companies to address dispute management as part of their overall digital strategy. These drivers include changes in the economics of digital payments, the rising importance of the customer experience, and improvements in digital integrations.
Economics of Digital Payments
The economics of digital payments have changed. Global digital payments in 2020 totaled $5.44 trillion and are expected to reach $11.20 trillion by 2026. As the volume of digital payments continues to rise, the volume of customer disputes will rise too. The cost of managing these disputes is rising as well, both in terms of human capital and legacy technology costs. If left unaddressed, those losses will add up.
Customer Experience is Now a Central Focus
The customer experience has become a central focus of many digital transformations. The first generation to grow up online are now adults, and they expect every company to offer the type of customized experiences they know from Amazon, Netflix, and others. Today’s customers will simply not tolerate a bad customer experience. They are not afraid to tell others about a poor experience, and they’re quick to share their stories online – particularly bad interactions like disputed payments. Financial services companies must manage the dispute process and the after-effects in a way that these customers want and expect.
Improvement in Digital Integration
Significant advances in technology make an integrated dispute management strategy possible. These technologies include artificial intelligence, machine learning, and data aggregation. Financial services companies are beginning to accept that various payment services cannot be offered and operated in isolation. Disputes are part of a much broader, integrated ecosystem that historically has operated in silos (fraud claims versus non-fraud claims, credit versus debit, fraud operations versus dispute operations, etc.). This means an integrated strategy can be built to both manage the disputed charges and provide a great customer experience throughout the process.
Economics of Digital Payments
The economics of digital payments have changed. Global digital payments in 2020 totaled $5.44 trillion and are expected to reach $11.20 trillion by 2026. As the volume of digital payments continues to rise, the volume of customer disputes will rise too. The cost of managing these disputes is rising as well, both in terms of human capital and legacy technology costs. If left unaddressed, those losses will add up.
Customer Experience is Now a Central Focus
The customer experience has become a central focus of many digital transformations. The first generation to grow up online are now adults, and they expect every company to offer the type of customized experiences they know from Amazon, Netflix, and others. Today’s customers will simply not tolerate a bad customer experience. They are not afraid to tell others about a poor experience, and they’re quick to share their stories online – particularly bad interactions like disputed payments. Financial services companies must manage the dispute process and the after-effects in a way that these customers want and expect.
Improvement in Digital Integration
Significant advances in technology make an integrated dispute management strategy possible. These technologies include artificial intelligence, machine learning, and data aggregation. Financial services companies are beginning to accept that various payment services cannot be offered and operated in isolation. Disputes are part of a much broader, integrated ecosystem that historically has operated in silos (fraud claims versus non-fraud claims, credit versus debit, fraud operations versus dispute operations, etc.). This means an integrated strategy can be built to both manage the disputed charges and provide a great customer experience throughout the process.
Solving Dispute Management and Customer Experience – Together
With an integrated solution that manages disputes while providing a positive customer experience, companies can be customer-centric and build loyalty and trust while improving the dispute-resolution process. Financial services firms can achieve this balance by taking four steps.
Identify and engage with all customers via all channels (social, bots, live chat, email, and SMS). Listen on social platforms, leverage natural language processing to identify customer sentiment, capture customer dissatisfaction, and respond immediately. Capture all complaints regardless of channel for audit purposes, and orchestrate customer engagement across all channels in real-time. Send customers on personalized digital dispute resolution journeys.
Leverage AI to know and service the customer. AI can determine which complaints are likely to escalate. The AI engine can recommend the next best action, and workflow automation can allocate disputes to the right disputes agent. A complete customer view is necessary for better insights and to guide agents through the dispute processes. Guided workflows can make sure the correct data is captured and next best actions are taken, while the AI engine can recommend relevant articles to help agents elevate the service experience, track all service level agreement (SLA) metrics and automatically escalate resolutions within required timeframes.
The goal for dispute management is to resolve fast and build trust. Automation helps by driving better productivity and reducing issue-resolution times. By integrating with core systems, including existing dispute-management platforms, collaboration is possible across service teams. Capturing all dispute engagement data gives companies more information to prepare for audits. And live status updates show customers a commitment to transparency that builds trust. Automation captures all customer feedback throughout a dispute resolution, leading to higher rates of positive outcomes.
Use out-of-the-box analytics and AI models to uncover dispute insights. Use these insights to explore, learn, and take action. Recognize consistent themes, determine impacted customers, and engage immediately. Build proactive AI models without writing code, and quickly deploy the models to customer service agents while improving service teams’ overall productivity by identifying areas for re-skilling.
Identify and engage with all customers via all channels (social, bots, live chat, email, and SMS). Listen on social platforms, leverage natural language processing to identify customer sentiment, capture customer dissatisfaction, and respond immediately. Capture all complaints regardless of channel for audit purposes, and orchestrate customer engagement across all channels in real-time. Send customers on personalized digital dispute resolution journeys.
Leverage AI to know and service the customer. AI can determine which complaints are likely to escalate. The AI engine can recommend the next best action, and workflow automation can allocate disputes to the right disputes agent. A complete customer view is necessary for better insights and to guide agents through the dispute processes. Guided workflows can make sure the correct data is captured and next best actions are taken, while the AI engine can recommend relevant articles to help agents elevate the service experience, track all service level agreement (SLA) metrics and automatically escalate resolutions within required timeframes.
The goal for dispute management is to resolve fast and build trust. Automation helps by driving better productivity and reducing issue-resolution times. By integrating with core systems, including existing dispute-management platforms, collaboration is possible across service teams. Capturing all dispute engagement data gives companies more information to prepare for audits. And live status updates show customers a commitment to transparency that builds trust. Automation captures all customer feedback throughout a dispute resolution, leading to higher rates of positive outcomes.
Use out-of-the-box analytics and AI models to uncover dispute insights. Use these insights to explore, learn, and take action. Recognize consistent themes, determine impacted customers, and engage immediately. Build proactive AI models without writing code, and quickly deploy the models to customer service agents while improving service teams’ overall productivity by identifying areas for re-skilling.
A Comprehensive Solution
With the growth of digital payments, “card not present (CNP)” fraud is on the rise. Financial services companies can no longer consider these charges a cost of doing business. Wipro has helped financial services companies leverage Salesforce’s Financial Services Cloud (FSC) and our Dispute Management assets to manage their dispute-management process while providing enticing user experiences. As even more financial services companies advance their digital transformation, adding charge dispute management to their digital strategy is imperative.