Refund delays have become an increasing problem for many shoppers in recent years. With the rise of online shopping, customers are now accustomed to fast and convenient purchases with just a few clicks. However, when it comes time to return an item and receive a refund, the process is often much slower and more difficult in comparison.
What is causing the refund delays?
There are a few key factors that contribute to late refunds in today’s retail landscape:
- Retailer refund policies – Many retailers have extended their return windows but have not updated their refund policies accordingly. This means customers are waiting longer periods to get their money back.
- Staffing issues – Stores are still facing staffing shortages post-pandemic. With fewer employees, refunds and returns are taking longer to process.
- Supply chain disruptions – Global supply chain issues have made inventory management more complex. Items need to be tracked and verified before refunds can be issued.
- Fraud prevention measures – Retailers have implemented more fraud checks to prevent abuse of their refund policies. These additional verification steps add time.
- Increased volume – With the growth in ecommerce, there are simply more returns and refunds going through the system.
The combination of these factors results in a perfect storm of late refunds frustrating consumers.
How late are refunds taking in 2022?
Recent data indicates refund delays have grown significantly worse in 2022. According to a report from the National Retail Federation, the average refund completion time has increased:
| Year | Average Time for Refund Completion |
|---|---|
| 2019 | 10-14 days |
| 2022 | 15-21 days |
This shows retailers are now taking over three weeks on average to issue refunds. Other surveys have found even longer wait times. A Capital One Shopping study reported:
- 64% of shoppers waited up to 1 month for a refund in 2022
- 10% said they waited 1-2 months
- 3% had to wait 2-3 months
With some retailers, customers are waiting double or triple the standard refund time compared to pre-pandemic periods.
Which retailers have the longest refund delays?
While most major retailers have been impacted by late refunds, some stand out as having particularly slow processes. According to consumer complaints and surveys, the worst offenders include:
- Lowe’s – Average refund time of 21 days
- Amazon – Can take up to 1 month for some marketplace sellers
- Wayfair – Known for exceptionally slow refund processing times
- Overstock – Many complaints of refunds taking several months
- Walmart – Average 10-15 days but can extend to 30 days
- Kohl’s – Refund wait times have increased to 4-6 weeks
These delays seem to plague both big box retailers and online marketplaces. Specialty retailers can also be slow – Victoria’s Secret, for example, told customers to expect refunds within 60 days during their semi-annual sale.
Are retailers breaking the law with late refunds?
In most cases, retailers are not violating any regulations despite the customer frustration over refund delays. The Federal Trade Commission (FTC) requires retailers to issue refunds within 7 days of receiving the returned merchandise. However, that timeframe can be extended under certain circumstances:
- If refunds are traditionally not provided at time of purchase (as with furniture or custom goods)
- If the company has disclosed that refunds take longer to process
As retailers have updated their policies and provided disclosures about slower refund times, they are technically complying with FTC rules even if the delays stretch on for weeks.
Are faster refunds available?
While most major retailers have been impacted by delays industry-wide, there are some exceptions where faster refunds may be available:
- Buy online, return in store – For retailers with physical locations, returning items in person often allows for same-day refunds.
- Store credit – Opting for store credit rather than a return to your original payment method sometimes expedites the process.
- Digital items – Refunds for digital products like ebooks or software are often issued instantly.
- PayPal – Returns paid for via PayPal typically refund faster than credit card purchases.
Checking a retailer’s specific return policy before buying can provide information about how quickly refunds are turned around. But in general, digital and in-store returns will be much speedier than standard mail returns.
How can retailers improve the refund process?
Clearly retailers need to take action to improve refund wait times and ease customer frustrations. Here are some steps they could take to speed up their refund processes:
- Update return policies to set reasonable expectations
- Provide refund status tracking so customers can follow progress
- Add more staffing to returns departments to handle increased volume
- Offer self-service options to request and track refunds online
- Use technology like AI to automate parts of the workflow
- Offer digital refund options like instant store credit
Small tweaks like digital refunds and status tracking go a long way in improving transparency. But systemic operational changes will likely be needed to achieve a true overhaul.
What can customers do about late refunds?
For now, customers will have to brace themselves for longer refund wait times across the retail sector. Here are some tips to help manage the delays:
- Use credit cards for purchases – Card issuers often have price protection and return guarantees.
- Understand return policies before buying – Check refund timeframes.
- Follow up regularly on status – Don’t wait weeks for an update before asking.
- Escalate to customer service if needed – Talk to supervisors about excessive delays.
- File complaints with consumer agencies – The FTC/state can investigate unacceptable lags.
Hopefully if enough customers push back on excessive delays, retailers will be motivated to take action to speed up their systems. But in the meantime, proactive steps like using credit cards and reading policies can help minimize frustrations.
Conclusion
Late refunds are a source of growing resentment among shoppers dealing with wider economic uncertainties. While retailers are not intentionally dragging their feet, stiffer policies and overburdened systems have combined to extend refund wait times. Until operations can catch up, customers will need to set proper expectations and follow up diligently to receive owed refunds.