Risky refunds: Websites stonewalling consumers

Three websites refused to refund consumers who sought to take money back from their recharged accounts, while another 18 agreed to a refund following negotiations, the Shanghai Consumer Council announced on Monday.

The council conducted a four-month investigation, posing as common consumers to check the recharge consumption performances of 31 Internet platforms covering online shopping, tourism, life services and online education.

Officials recharged accounts and asked for withdrawal later during the trial.

There is a vacuum with regards to regulation in this area, exposing consumers to potential financial risks, according to Tang Jiansheng, deputy secretary-general of the council.

Among the 31 websites, only 10 offered a self-helping refund for consumers, the council noted.

Twelve sites, such as KFC, Pizza Hut, Amazon, freight service provider Huolala, Chinese ride-hailing platform Ucar and online retailer FruitDay, provided refunds after consumers' "negotiations" with after-sales personnel, while another five, including Burger King, Hema Fresh and 21Cake, promised a refund only when the council intervened.

Lyfen, a domestic retailer of snacks, charged 2-yuan commission for the refund.

Three websites, FreshFresh, an e-commerce platform of fresh food; delivery platform Dada; and Womai, owned by China's top food processor and trader COFCO, simply refused to provide a refund, according to the council.

"The practice infringes on consumers' rights to know, to fair trade and to demand for compensation," said Tao Ailian, secretary-general of the council. "In an Internet era, the protection of consumers' fund is becoming a problem.

"We found that the refund process was held up in many cases since long negotiations were involved, even if businesses eventually provided a refund.

"It is easy for consumers to recharge their accounts without any obstacle, so it should be the same, without any threshold, when they want to withdraw the money," she noted: "The change of consumption habits and the convenience behind the new model also bring financial risks due to the credibility problem of the businesses."

The investigation also covered 28 websites using non-gaming virtual currency for recharge. Their services ranged from English study and reading to video and entertainment, and consumers pay for the virtual currency, which is saved in their account.

Among them, 15 either refused to pay back or set very harsh conditions for a refund, the council revealed.

These included the reading platform of online video channel iQiyi, QQ reading, short video sharing app Douyin, also known as TikTok, and video-sharing site Meipai.

The remaining sites, such as Q&A website Zhihu and Tmall reading platform, promised a refund only after the intervention of the council.

There have been a number of instances of businesses suddenly closing down and financial chains breaking up, leaving consumers in the lurch, the consumer council said, adding that the holding and use of consumers' fund by Internet platforms has become a major risk in the consumption sector.

The council has urged the websites to uphold consumers' rights to refunds and ensure the refunding process is both convenient and efficient instead of setting up obstacles through technical ploys and business tricks.