{"id":9549,"date":"2024-02-20T18:21:53","date_gmt":"2024-02-20T18:21:53","guid":{"rendered":"https:\/\/www.getcraver.com\/delivery-app-refund-abuse\/"},"modified":"2025-11-26T13:03:37","modified_gmt":"2025-11-26T20:03:37","slug":"delivery-app-refund-abuse","status":"publish","type":"post","link":"https:\/\/www.getcraver.com\/blog\/delivery-app-refund-abuse\/","title":{"rendered":"Delivery App Refund Abuse Is Rising (And Here&#8217;s Why You Should Care)"},"content":{"rendered":"\n<p>The number of restaurants falling victim to fraudulent refunds is at an <a href=\"https:\/\/www.latimes.com\/food\/story\/2021-02-23\/restaurant-scam-credit-card-fraud\" rel=\"noopener\" target=\"_blank\"><span>all-time high<\/span><\/a>, making delivery app refund abuse one of the hottest topics among industry professionals.&nbsp;<\/p>\n\n\n\n<p>Business owners <a href=\"https:\/\/chargebacks911.com\/chargeback-field-report\/\" rel=\"noopener\" target=\"_blank\"><span>surveyed in 2023<\/span><\/a> estimated that one-third of their refunds were fraudulent, reporting a steady increase in refund fraud over the past 3 years.<\/p>\n\n\n\n<p>Unsurprisingly, people are worried\u2026 but like most things, the more you know about delivery app refund abuse, the better you can prepare and respond.&nbsp;<\/p>\n\n\n\n<p>So, let\u2019s start at square one, shall we?<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What is Delivery App Refund Abuse?<\/h2>\n\n\n\n<p>Delivery app refund abuse is exactly what it sounds like \u2014 when individuals misuse the (often generous) refund policies of third-party apps like DoorDash or Uber Eats.<\/p>\n\n\n\n<p>The definition of delivery app refund abuse intentionally casts a wide net, because there\u2019s no \u201cone size fits all\u201d approach to what this abuse looks like in practice.&nbsp;<\/p>\n\n\n\n<p>However, refund abuse <em>typically <\/em>takes shape as false customer claims, including that:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>A hygiene issue (e.g. a hair in the food).&nbsp;<\/li>\n\n\n\n<li>A successfully delivered order never arrived.<\/li>\n\n\n\n<li>A paid-for item was made incorrectly or missing.&nbsp;<\/li>\n\n\n\n<li>An order wasn\u2019t placed by them (i.e. it was fraudulent).&nbsp;<\/li>\n<\/ul>\n\n\n\n<p>Then, after the customer shares their concerns with the delivery app\u2019s customer service team or their credit card company, they request a full refund or chargeback\u2026 and they usually get it.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/www.getcraver.com\/wp-content\/uploads\/2025\/06\/Food-delivery-complaint.png\" alt=\"Man calling pizzeria and complaining about pizza delivery.\"\/><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\">How Does Delivery App Refund Abuse Happen?<\/h2>\n\n\n\n<p>There are two main reasons that we\u2019re seeing a rise in delivery app refund abuse.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Reason 1: Delivery App Refund Abuse Is Easy<\/h3>\n\n\n\n<p>Delivery app refund abuse has a ridiculously low barrier to entry.&nbsp;<\/p>\n\n\n\n<p>All you need to \u201csucceed\u201d at delivery app refund abuse is an app, a credit card, and a lie\u2026 and we have the data to prove that formula for success is working.&nbsp;<\/p>\n\n\n\n<p>Thanks to Anand Karthik Tumuluru<strong> <\/strong>of<strong> <\/strong><a href=\"https:\/\/www.tryloop.ai\/\" rel=\"noopener\" target=\"_blank\"><span>Loop AI<\/span><\/a>, we know that third-party delivery apps have an impressive chargeback ratio. \u201c[J]ust looking at chargebacks and order errors as a whole across the thousands of locations that we have,\u201d<strong> <\/strong>Anand<strong> <\/strong>says, \u201cthe rough sizing of the issue itself is around 3%.\u201d<\/p>\n\n\n\n<p>That means on average, 30 in every 1,000 DoorDash or Uber Eats customers request refunds.&nbsp;<\/p>\n\n\n\n<p>Now at first glance, that number doesn\u2019t seem too bad at all. Until you learn the chargeback ratio for third-party delivery apps is <em>20x more<\/em> than the industry average.&nbsp;<\/p>\n\n\n\n<p>The average chargeback ratio for first-party orders is <a href=\"https:\/\/chargebacks911.com\/chargeback-ratio\/\" rel=\"noopener\" target=\"_blank\">between ~0.1% and ~0.2%<\/a>, which means that on average,<em> <\/em>only<em> <\/em>one or two in every 1,000 customers request a refund from actual restaurants or hospitality businesses.&nbsp;<\/p>\n\n\n\n<div class=\"separators-custom-box  \"  style='background-color: #fff8f1;'>\n\n\t\n\n\t\t\t\t\t<div class=\"cta_title\" \n\t\t\tstyle='color:#000000;'\t\t\t>Need a seamless delivery integration? Our Online Ordering Guide compares the top five systems for you.\u00a0<\/div>\n\t\t\n        \n\t\t\t\t\t<a href=\"#Form\"\n\t\t\t\t \t\t\t\tstyle=\"background-image: linear-gradient(to left, rgb(217,58,1), rgb(239,100,16));\"\n\t\t\t\tclass=\"\"\n\t\t\t>\n\t\t\t<span class=\"\" \n\t\t\tstyle='color:#ffffff;'\t\t\t>\n\t\t\t\tDownload Now\t\t\t<\/span>\n\t\t\t<\/a>\n\t\t\n\t<\/div>\n\n\n\n<h3 class=\"wp-block-heading\">Reason 2: Delivery Apps Encourage Refund Abuse&nbsp;<\/h3>\n\n\n\n<p>The massive discrepancy between chargeback ratios leads us to the second reason behind increased refund abuse: the apps control the refunds.<\/p>\n\n\n\n<p>When angry, upset, or disappointed customers reach out and complain about their food deliveries, the restaurant doesn\u2019t get the brunt of it \u2014 the app\u2019s customer service team does. Since complaints pose obvious risks to the app\u2019s reputation, it\u2019s not surprising that DoorDash and Uber Eats are quick to pull the \u201crefund\u201d trigger in the name of customer satisfaction.&nbsp;<\/p>\n\n\n\n<p>However, where things do get surprising is in the refund processing stage. While the delivery app is responsible for managing refund requests and approving them\u2026 the restaurant is the one responsible for paying out those app-approved refunds.&nbsp;<\/p>\n\n\n\n<p>Take DoorDash, for example.<\/p>\n\n\n\n<p>Their <a href=\"https:\/\/get.doordash.com\/en-ca\/learning-center\/doordash-merchant-refund\" rel=\"noopener\" target=\"_blank\"><span>article on error charges<\/span><\/a> explains that \u201cDoorDash issues a refund and\/or credit\u201d on behalf of the restaurant, but, \u201c[d]epending on the situation, [the restaurant] may be charged a partial or full fee to cover the cost.\u201d Then, when it comes time to pay those error charges, they\u2019re \u201cdeducted directly from merchant payouts,\u201d ranging from \u201c25% to 100% of the applicable item costs, including tax, and subtracting commission paid.\u201d<\/p>\n\n\n\n<p>Ultimately, delivery app refund abuse is about gaming the system, effectively weaponizing the \u201ccustomer-first\u201d mentality that many restaurants and third-party apps pride themselves on.<\/p>\n\n\n\n<p>And, considering how easy it is to abuse refunds, it\u2019s a concern that every restaurateur should have on their radar.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/www.getcraver.com\/wp-content\/uploads\/2025\/06\/Delivery-Apps.png\" alt=\"Doordash and Skip the Dishes delivery apps\"\/><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\">Why You Should Care: A Case Study in Delivery App Refund Abuse<\/h2>\n\n\n\n<p>There are two main reasons your restaurant should be dialed into the concern over delivery app refund abuse:<\/p>\n\n\n\n<p>1. It costs your restaurant money.&nbsp;<\/p>\n\n\n\n<p>Restaurants are responsible for a portion of app-approved refunds, if not the entire thing.<\/p>\n\n\n\n<p><span>2.  It costs your restaurant time.&nbsp;<\/span><\/p>\n\n\n\n<p>Sorting through refund disputes with your bank or a third-party app can take weeks (or months).<\/p>\n\n\n\n<p>And, when these concerns come together in the perfect storm, nothing good happens\u2026 and Spoon by H knows that all too well.&nbsp;<\/p>\n\n\n\n<p>Spoon by H is a Korean restaurant in L.A., owned and operated by chef Yoonjin Hwang.&nbsp;<\/p>\n\n\n\n<p>Or at least it <em>was; <\/em>Spoon by H shut its doors for good in 2021, citing \u201c<a href=\"https:\/\/la.eater.com\/2021\/2\/23\/22297253\/spoon-by-h-restaurant-closing-fraud-credit-card-food-chargebacks-closure-pandemic-covid-19-news-sad\" rel=\"noopener\" target=\"_blank\"><span>fraudulent orders and chargebacks<\/span><\/a>\u201d as the main reason for its closure.&nbsp;<\/p>\n\n\n\n<p><a href=\"https:\/\/la.eater.com\/2021\/2\/23\/22297253\/spoon-by-h-restaurant-closing-fraud-credit-card-food-chargebacks-closure-pandemic-covid-19-news-sad\" rel=\"noopener\" target=\"_blank\"><span>Hwang said<\/span><\/a> the \u201cfalse charges\u201d had been happening for a year, starting with credit card chargebacks and expanding to third-party apps. Regardless of the platform, Hwang got the short end of the stick either way. Not only was she responsible for footing the refund bills from third-party apps, but she also lost valuable time in the kitchen, spending time trying to resolve chargeback and app disputes, instead.&nbsp;<\/p>\n\n\n\n<p>In a now-private series of Instagram posts, Spoon by H shared the following statement about the restaurant closure:&nbsp;<\/p>\n\n\n\n<p>&#8220;We are heartbroken to find ourselves sharing the very news we hoped we would never have to share\u2026 Spoon By H will be closing. Although we put up our very best fight, we could no longer hold out against the growing barrage of fraudulent disputed charges and the countless refunds issued.&#8221;<\/p>\n\n\n\n<div class=\"separators-custom-box  \"  style='background-color: #fff8f1;'>\n\n\t\n\n\t\t\t\t\t<div class=\"cta_title\" \n\t\t\tstyle='color:#000000;'\t\t\t>Choose an online ordering system that makes delivery easier, not harder\u2014start with our guide.<\/div>\n\t\t\n        \n\t\t\t\t\t<a href=\"#Form\"\n\t\t\t\t \t\t\t\tstyle=\"background-image: linear-gradient(to left, rgb(217,58,1), rgb(239,100,16));\"\n\t\t\t\tclass=\"\"\n\t\t\t>\n\t\t\t<span class=\"\" \n\t\t\tstyle='color:#ffffff;'\t\t\t>\n\t\t\t\tDownload Now\t\t\t<\/span>\n\t\t\t<\/a>\n\t\t\n\t<\/div>\n\n\n\n<h2 class=\"wp-block-heading\">How You Can Combat Delivery App Refund Abuse<\/h2>\n\n\n\n<p>While delivery app refund abuse is a very real (and rapidly growing) concern in the restaurant industry, all hope is not lost. There are multiple different ways to combat delivery app refund abuse depending on your restaurant\u2019s needs, wants, and your level of concern.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Option 1: Stop using delivery apps entirely<\/h3>\n\n\n\n<p>One way to combat delivery app refund abuse is to stop using delivery apps entirely. Although this isn\u2019t the most <em>ideal<\/em> solution \u2014 <a href=\"\/blog\/best-restaurant-apps\" target=\"_blank\" rel=\"noopener\"><span>apps offer huge potential<\/span><\/a> for revenue generation \u2014 it\u2019s the only sure-fire way to avoid refund abuse through delivery apps.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Option 2: Use your own Craver app for delivery<\/h3>\n\n\n\n<p>Another way to combat delivery app refund abuse is to use your <em>own<\/em> restaurant app with<a href=\"\/feature\" rel=\"noopener\" target=\"_blank\"> Craver<\/a>. Depending on the level of control you want to have over your restaurant\u2019s delivery services, using a Craver app for delivery can look like two different things.<\/p>\n\n\n\n<p><span>1. Use the Craver app and manage the delivery process on your own<\/span><\/p>\n\n\n\n<p>If you don\u2019t want to integrate your Craver app with third-party delivery apps, no worries \u2014 you can still offer delivery services in a way that works for you! Whether you\u2019re hiring additional staff to manage the deliveries or delegating existing staff to delivery duties, you have control over refunds <em>and<\/em> the rest of the delivery process, too.&nbsp;<\/p>\n\n\n\n<p><span>2. Use the Craver app, but use third-party apps for delivery&nbsp;<\/span><\/p>\n\n\n\n<p>Using Craver\u2019s Uber Eats and DoorDash app integrations, you can lean on the third-party apps\u2019 fleet of delivery drivers without having to hire your own or ask your staff to deliver. And, because orders come through your Craver app instead of Uber Eats or DoorDash, you get total control over your refund policy and process.<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/www.getcraver.com\/wp-content\/uploads\/2025\/06\/Commission-free-deliveries-1.png\" alt=\"Commission free deliveries with Craver.\"\/><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\">Wrap Up<\/h2>\n\n\n\n<p>Delivery app refund abuse is a very real concern in the restaurant industry, putting owners and operators between a rock and a hard place \u2014 continue delivery services or quit cold turkey?&nbsp;<\/p>\n\n\n\n<p>But, whether you make the difficult decision to move away from delivery or you look at alternatives like a custom-built Craver app, there\u2019s only one \u201cright\u201d way to respond to the refund abuse crisis\u2026 and that\u2019s by doing what feels best to protect you and your business.&nbsp;<\/p>\n\n\n<div class=\"m-form  gb\"  style='--columns-ratio: 50%;'>\n\n\t\t<a id=\"Form\"><\/a>\n\t\n\t    \n    <div class=\"m-form__container container\" style=\"\">\n\n        <div class=\"l-form l-form-v3 order-default\">\n\n            <div class=\"l-form__col l-form__form\">\n\t\t        \n\n\t<div class=\"c-form\">\n\t\t<div class=\"c-form__embed\">\n\t\t\t                <div id=\"hubspot-form-1\" class=\"c-contact hubspot-form\">\n                    <script>\n                        document.addEventListener(\"DOMContentLoaded\", function() {\n                            if (typeof hbspt !== 'undefined' && hbspt.forms) {\n\n                                hbspt.forms.create({\n                                    portalId: \"4732366\", \/\/ this is your portal id\n                                    formId: \"9511e2c4-908a-40c8-bfa6-d87fd5c78177\", \/\/ this is the form id\n                                    target: \"#hubspot-form-1\",\n                                    css: \"\",\n                                    cssClass: \"single-resources-form\",\n                                });\n\n                            } else {\n                                console.error(\"HubSpot script not loaded.\");\n                            }\n                        });\n                    <\/script>\n                                    <\/div>\n                \t\t<\/div>\n\t<\/div>\n            <\/div>\n\n        <\/div>\n\n    <\/div>\n<\/div>\n\n\n\n<p><a id=\"Download-Restaurant-Online-Ordering-Guide\" data-hs-anchor=\"true\"><\/a><\/p>\n\n\n\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The number of restaurants falling victim to fraudulent refunds is at an all-time high, making delivery app refund abuse one of the hottest topics among industry professionals.&nbsp; Business owners surveyed in 2023 estimated that one-third of their refunds were fraudulent, reporting a steady increase in refund fraud over the past 3 years. Unsurprisingly, people are&#8230;<\/p>\n","protected":false},"author":16,"featured_media":9554,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[98],"tags":[13,16],"class_list":["post-9549","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.8 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Delivery App Refund Abuse Is Rising (And Here&#039;s Why You Should Care)<\/title>\n<meta name=\"description\" content=\"Fraudulent refunds have been steadily increasing. 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People are worried... but the more you know about delivery app refund abuse, the better you can prepare.\u00a0\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.getcraver.com\/blog\/delivery-app-refund-abuse\/\" \/>\n<meta property=\"og:site_name\" content=\"Craver | Online Ordering Systems for Coffee Shops\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/craverapp\/\" \/>\n<meta property=\"article:published_time\" content=\"2024-02-20T18:21:53+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2025-11-26T20:03:37+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.getcraver.com\/wp-content\/uploads\/2025\/06\/Delivery-Refund.png\" \/>\n\t<meta property=\"og:image:width\" content=\"1640\" \/>\n\t<meta property=\"og:image:height\" content=\"924\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/png\" \/>\n<meta name=\"author\" content=\"Melissa Mertsis\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@craver_app_\" \/>\n<meta name=\"twitter:site\" content=\"@craver_app_\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Melissa Mertsis\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"8 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.getcraver.com\/blog\/delivery-app-refund-abuse\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.getcraver.com\/blog\/delivery-app-refund-abuse\/\"},\"author\":{\"name\":\"Melissa Mertsis\",\"@id\":\"https:\/\/www.getcraver.com\/#\/schema\/person\/438c202bb4adb066914cdd36c21d767d\"},\"headline\":\"Delivery App Refund Abuse Is Rising (And Here&#8217;s Why You Should Care)\",\"datePublished\":\"2024-02-20T18:21:53+00:00\",\"dateModified\":\"2025-11-26T20:03:37+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.getcraver.com\/blog\/delivery-app-refund-abuse\/\"},\"wordCount\":1353,\"publisher\":{\"@id\":\"https:\/\/www.getcraver.com\/#organization\"},\"image\":{\"@id\":\"https:\/\/www.getcraver.com\/blog\/delivery-app-refund-abuse\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.getcraver.com\/wp-content\/uploads\/2025\/06\/Delivery-Refund.png\",\"keywords\":[\"Most Popular\",\"Operational Efficiency\"],\"articleSection\":[\"Blog Post\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.getcraver.com\/blog\/delivery-app-refund-abuse\/\",\"url\":\"https:\/\/www.getcraver.com\/blog\/delivery-app-refund-abuse\/\",\"name\":\"Delivery App Refund Abuse Is Rising (And Here's Why You Should Care)\",\"isPartOf\":{\"@id\":\"https:\/\/www.getcraver.com\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.getcraver.com\/blog\/delivery-app-refund-abuse\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.getcraver.com\/blog\/delivery-app-refund-abuse\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.getcraver.com\/wp-content\/uploads\/2025\/06\/Delivery-Refund.png\",\"datePublished\":\"2024-02-20T18:21:53+00:00\",\"dateModified\":\"2025-11-26T20:03:37+00:00\",\"description\":\"Fraudulent refunds have been steadily increasing. 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