How the US, China, and Brazil Handle Refunds: A Tale of Three Payments
How do payments work in the US, China, and Brazil?
Most Americans assume the world's payment systems work like their own, but the US is unusual in its card dominance and rules that shift fraud risk to merchants. This article compares the journey of a fake pair of Air Jordans bought in San Francisco, Hangzhou, and São Paulo, showing how refunds differ: US chargebacks act as a privatized small-claims court, China relies on government mediation, and Brazil's Pix offers instant settlement but no buyer protection for product disputes. It also explains why US merchants pay 2.6% fees versus Brazil's 0.22%, bundling micro-loans, insurance, rewards, and credit history into the card swipe.
If you stop to consider what just happened, you’ll realize that we just used a privatized small-claims court where the burden of proof largely falls on the defendant.
- yftsui
This article is written almost entirely from the seller's point of view, of course seller does not want to pay any fees. Some of the claims that buyer get same level of protection without chargeback is hilarious, it might be true that the author get special treatment as a foreigner in China from the government (the 12315 statement), but that's far from a typical customer experience.
"Chinese consumer law also gives buyers stronger remedies when a merchant knowingly commits fraud, including damages above the purchase price."
There is no small claim court or equivalent in China, 12315 is likely the closest but they can only provide recommendations, they cannot freeze assets or issue demands like a court. In absence of chargeback, the buyer owns the burden of gather evidence and proof, which usually includes paid test reports from trusted government agencies that the item is defect. In practice, a seller ships junk or nothing often get to keep the money and close the shop before you can get the money back.
- Brajeshwar
You should include India’s UPI (Unified Payments Interface). It is interesting and should fit in your comparison/references.
- veqq
Visa actually charges a smaller fee than pix, however its payments (almost all) require the ability to charge back. Banks processing American payments charge a few percent "for" chargeback etc. insurance, but the infrastructure could be used for similar digital cash (without any reversals), though I doubt it'll change any time soon.