Ethoca

The idea is simple and slightly paradoxical: the merchant refunds voluntarily to avoid being forced to. When a cardholder calls their bank to report a fraudulent purchase, the bank sends an alert through Ethoca straight to the merchant. If the merchant refunds and stops the shipment in time, there is no chargeback — no fee and no mark against it in the card network's monitoring statistics. The issuer, for its part, is spared the paperwork of a dispute.

Ethoca was founded in Toronto and bought by Mastercard in 2019, the same year Visa bought its rival Verifi. The two big networks now each own a system for avoiding the disputes their own rulebooks create. Ethoca also sells Consumer Clarity, which shows the merchant's logo and receipt details inside the banking app. The point is for customers to recognise the purchase rather than dispute it, since an unfamiliar company name on the statement is one of the most common causes of friendly fraud.