Friendly Fraud Surges as Online Shopping Rises
· news
Shoppers Made 158 Million Chargeback Disputes in 2025 as ‘Friendly Fraud’ Surged 29% — and Businesses Pay the Price
The rise of online shopping has brought about a new challenge for businesses: friendly fraud. This phenomenon, where consumers dispute charges with their banks to get free money, is on the rise, leaving retailers reeling.
According to Juniper Research, American consumers filed 158 million transaction disputes in 2025, an increase of 29% from 2021. While some of these disputes are legitimate cases of fraud or billing errors, many more can be attributed to consumers who simply don’t want to pay for what they’ve bought.
The complexity of online transactions is a significant contributor to this surge in friendly fraud. With multiple platforms, vendors, and processors involved, it’s easy for consumers to get lost in the weeds – especially younger shoppers who may not be familiar with e-commerce. As a result, some consumers are using chargebacks as a way to opt out of paying for items they’ve purchased online.
The consequences of friendly fraud go beyond just the financial costs to businesses. When consumers use chargebacks to get free money, it creates a culture of entitlement that undermines trust in the systems designed to protect us from scams and errors. It’s also a clear sign that some consumers are not taking responsibility for their own actions online.
Chargebacks, in theory, are a useful tool – allowing consumers to protect themselves from genuine scams and errors. However, in practice, it’s clear that some people are using them as a means of gaming the system. Businesses pay the price for these disputes, with cumulative chargeback fees being devastating, especially for smaller retailers who don’t have the same level of resources as their larger competitors.
The issue of friendly fraud is just one manifestation of a growing pattern of consumer irresponsibility. From ghosting online purchases to disputing charges with ease, some consumers are beginning to view e-commerce as a zero-sum game – where they can simply opt out of paying for items if it suits them.
Businesses must take action to prevent chargebacks from being used as a means of getting free money. This means investing in more robust fraud detection tools and working with banks and credit card companies to identify genuine cases of friendly fraud. Consumers, too, have a role to play: taking responsibility for their own actions online and not using chargebacks as an easy way out.
As we continue to shop online in greater numbers, it’s time to take a step back and ask ourselves: what does this mean for the future of e-commerce? By acknowledging the problem of friendly fraud and taking steps to address it, we can work towards creating a more responsible and trustworthy online shopping environment.
Reader Views
- RJReporter J. Avery · staff reporter
The convenience of online shopping has a dark side: friendly fraud. It's not just about scams and billing errors – many chargebacks are simply consumers exercising their ability to opt out of paying for purchases they've made. Businesses are left shouldering the financial burden, while consumers get free money. But what's often overlooked is that these disputes also have a ripple effect on legitimate online transactions. As algorithms increasingly rely on data from disputed charges, this could inadvertently chill e-commerce growth by making it more expensive and riskier for merchants to do business online.
- ADAnalyst D. Park · policy analyst
While the surge in friendly fraud is alarming, it's essential to acknowledge that chargeback policies often favor consumers over merchants. Many retailers view chargebacks as a cost of doing business online, but what about the long-term consequences? A disproportionate number of chargebacks can lead to increased costs for businesses and even result in account closures by payment processors. It's time for regulators to revisit chargeback rules and consider implementing more stringent measures to prevent abuse.
- CMColumnist M. Reid · opinion columnist
The so-called 'friendly fraud' phenomenon is a ticking time bomb for online retailers. What's concerning is that these disputes often arise from buyers' remorse rather than genuine errors or scams. To combat this, merchants must implement more robust authentication measures to verify identity and intent. A possible solution lies in zero-trust models, which can flag suspicious activity and prevent fraudulent transactions before they occur.