Chargeback closes $6.6 million investment round

Xomi Inc., a Salt Lake City-based SaaS provider doing business as Chargeback, completed a $6.6 million funding round on June 9, 2020, for its real-time dispute management platform. Led by FINTOP Capital, Next Frontier Capital and Next Coast Ventures, the investment affirms the viability of the company’s real-time dispute management platform, Chargeback representatives stated. The platform enables merchants to decrease disputes, boost conversion rates and optimize acceptance, according to John Munro, CEO at Chargeback.

“The support of FINTOP and Next Frontier allows us to continue to execute on our accelerated growth strategy and innovation goals immediately,” Munro said in a statement. “With the rise of ecommerce spending during the COVID-19 pandemic, merchants have seen a rise in fraud and disputes. I am thrilled that we are poised to continue our track record of helping merchants retain more of their hard-earned revenue, now and for years to come.”

John Phillpott, partner at FINTOP, added, “We are thrilled to add rapidly growing Chargeback to our fintech portfolio. In a space that is historically labor intensive and slow to adopt technology, the Chargeback SaaS platform has made them a clear leader in the dispute management space.”

Automation, aggregation, insights

Munro pointed out that Chargeback’s combined automation, data aggregation and advanced analytics can help merchants scale, optimize revenue and provide a better customer experience. He added that the infusion of working capital will help Chargeback and participating partners drive efficiencies while helping to alleviate the pain of managing chargeback disputes both globally and within the United States.

Noting that managing disputes has long been expensive and time-consuming, Munro suggested that traditional approaches have generally created a poor experience for customers, especially online shoppers. Card-not-present transactions are typically disputed 12 times more than card present transactions and are likely to continue to rise in response to the global CORONA pandemic, he stated.

Munro’s expectations are further supported by data released June 8, 2020, by ACI Worldwide, which found a steep increase in global ecommerce sales. High growth categories included gaming (84 percent); general retail (190.2 percent); jewelry: (190.8 percent); sportswear and sporting goods: (216.3 percent) and electronics (32.2 percent), researchers noted.

Friendly fraud

Debbie Guerra, executive vice president, ACI Worldwide, said, “The vigilance and adaptability displayed by merchants as they evolve their fraud strategies in light of COVID-19 appears to have been rewarded by decreasing fraud rates. However, non-fraud chargebacks have risen 25 percent and will continue to present a challenge, confirming the trend of friendly fraud we anticipated—especially for hard hit businesses in travel and ticketing—while these merchants overhaul credit and rebooking options, dispute resolution processes, supply chain visibility and customer communication channels.”

Guerra warned merchants to monitor systems, update frequently and be especially watchful for forms of friendly fraud, which typically occurs when a cardholder receives goods but denies making a purchase or a family member makes purchase without cardholder approval. Business intelligence tools and real-time monitoring can lead to immediate decisions and responses, she stated. Employ rapid access to fraud intelligence to inform rules changes in real time. 

Chargeback’s SaaS-based dispute management platform acts as a collaboration hub for integrating and automating every step of the dispute lifecycle, Munro stated. The platform reduces operational overhead, optimizes retained revenue, increases acceptance rates, and improves the customer's experience.

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