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The UK’s 2023 Serial Refunder Report

Last year we released our annual Serial Refunder Report for 2022 illustrating the shift in consumer behaviour and buying habits which were forced to change due to COVID-19. One of the biggest changes now compared to last year is that retailers have started to charge customers for returns.

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The ‘new normal’ of buying products online rather than in-store means customers can’t see their items before they buy, which results in multiple returns. The rise in fast-fashion is facilitating this, with the market predicted to reach a value of 1.33 billion in 2026, a sizable increase compared to its worth in 2022 (£99 billion) [1].

We have updated our study for 2023 to further understand consumer behaviour and why retailers have now started to charge for returns with the rising cost of delivery. In order to investigate consumer behavioural shifts, we analysed anonymised transactions on over 54,000 Paymentsense card machines across multiple locations. The results show the areas and industries with the highest value of returned items from October 2021 to September 2022. We also reviewed brands that have now started charging for returns.

So, in 2023, are UK customers shying away from serial refunding with brands now charging for returns or, has the increase in online shopping still led to a huge number of returns being made? This is what we found…

What is a ‘serial refunder’?

A ‘serial refunder’ is a customer that continues to return items excessively. For example, ‘wardrobing’ is common among serial refunders where they order clothing items, use the purchase and then return for a full refund. Although not specific to serial refunders, another common reason for returning items is because of issues with the condition items arrive in. As customers aren’t able to hand pick items and see them before purchasing, this can lead to more refunds than if items were bought directly from a store.

The serial refunder behaviour becoming more prevalent over the past few years coupled with the cost of living crisis has given retailers no choice but to start charging for returns. As our report last year stated, returns cost UK retailers an estimated £60 billion a year on average, £20 billion of this total being from online shopping [2].

25% of the Top500 brands now charge customers to return items

Returns can have a considerable impact on both a brand’s profit margins and a customer’s experience. In fact, this year Forbes reported that hassle-free returns are one of the most important factors in a seamless buying experience [3]. Despite this, more brands are opting to charge their customers to return items with Internet Retailing reporting that 25% of the Top500 brands are now charging consumers for returns [4].

Although brands are starting to charge for returns and overall spend is reported to be down, those who are spending are choosing to do so more online now than before the pandemic. In May 2022, ONS stated that 26.6% of all retail sales were online compared to just 19.7% in February 2020, despite 62% of consumers saying they have reduced their spending due to rising costs [5].

Buy now pay later is having an impact on customer behaviour

The way customers are spending is also changing, according to a recent study that revealed nearly 60% of customers prefer using BNPL schemes over credit cards [6]. As a result, experts predict that ‘Buy Now, Pay Later’ schemes will increase in availability over the next five years [6].

The Cost of Living crisis is only likely to exacerbate the use of BNPL schemes which essentially allow customers to receive their goods first and only pay for items they don’t return. However, consumers do need to be careful when paying with this option because users may risk accumulating unsustainable levels of debt.

Aside from the heightened risk of customer debt, the ability to purchase items without spending money initially is also a contributing factor to retailers receiving more returns, in part due to excessive buying or ‘wardrobing’. Consumers can now order a ‘haul’ of items without being out of pocket, meaning they are potentially ordering far more than they would if the funds were to leave their accounts immediately.

The UK’s Serial Refunder Capitals in 2023

As serial refunding is becoming increasingly popular, we looked at our data to see how businesses, SMEs in particular, across the UK are being affected by the number of refunds and, on average, how many returns UK small businesses are processing each month.

Rank* City Number of refunds per location per month Average amount refunded per location per month (2021) Ranking compared to 2021 (+/- ranking position) Average amount refunded per location per month (2022)
1 Kirkwall 4.3 £403
2 Stevenage 3.5 £184 +15 £303
3 Perth 2.0 £246 +3 £281
4 Southall 1.9 £524 -2 £276
5 Bolton 1.7 £675 -4 £254
6 Reading 2.1 £307 -3 £232
7 Redhill 2.6 £233 +3 £228
8 Bromley 2.8 £286 -4 £211
9 Kingston upon Thames 2.1 £177 +11 £195
10 Llandudno 2.9 £222 +2 £169
11 Guilford 2.0 £148 +11 £165
12 Norwich 2.4 £245 -5 £152
13 Paisley 2.4 £111 +38 £150
14 St. Albans 2.1 £133 +20 £150
15 Oldham 1.7 £188 No change £148
16 Preston 1.8 £242 -8 £146
17 Milton Keynes 2.1 £233 -6 £144
18 Slough 2.3 £144 +12 £142
19 Ipswich 1.9 £158 +6 £140
20 Walsall 4.0 £221 (-7) £139

*Ranking ordered by average amount refunded per location per month 

Kirkwall is the 2023 Serial Refunder capital - small businesses in the city refund an average of £403 a month

Kirkwall takes the top spot for serial refunds in the UK 2023, as the city with the highest average value of refunds per month (£403), previously not ranking in last year’s top 20. Bolton was the serial refunder capital in our 2021 report, however, this city now ranks 5th in the updated 2023 report, with £254 refunds per month compared to £675 last year, a significant improvement with a 62.4% decrease in refunds.

Stevenage is the second-highest hotspot for serial refunders

Stevenage ranked in second place with the second-highest amount refunded per business month (£303), however, in last year's report, Stevenage ranked in 17th with £184 refunds per month. Perth rounded off the top three, with £281 refunds each month compared to ranking in 6th last year with £246.

Ranking at the bottom of our top 20 serial refunders list is Walsall, where £139 on average is refunded to customers per month. Ipswich ranked 19th with £140 and Slough in 18th with £142 refunds.

A total of £12,083 a month is returned from small businesses to consumers, compared to £15,600

Across all UK locations analysed in our 2022 report, a total of £12,083 (across 111 locations) a month is returned from small businesses to consumers, compared to £15,600 (across 118) in our 2021 report. This change in consumer behaviour could be due to the cost of living crisis with customers being more discerning when purchasing goods compared to last year.

Which cities are returning the highest value of goods?

Our research also revealed which residents returned the highest average amount of goods per person from small businesses in the UK.

Rank* City Number of refunds per location per month Ave refund amount per person (£)
1 Bolton 1.7 £149
2 Southall 1.9 £145
3 Perth 2.0 £140
4 Reading 2.1 £112
5 Kirkwall 4.3 £95
6 Kingston 2.1 £92
7 Oldham 1.7 £89
8 Redhill 2.6 £88
9 Stevenage 3.5 £85
10 Belfast 1.3 £83
11 Guilford 2.0 £82
12 Preston 1.8 £80
13 Chelmsford 1.5 £80
14 Darlington 1.2 £79
15 Medway 1.6 £77
16 Galashiels 1.0 £77
17 Huddersfield 1.6 £76
18 Newport 1.3 £76
19 Salisbury 1.1 £75
20 Bromley 2.8 £74

*Ranking ordered by the average refund amount per person

Bolton residents returned the highest average value of goods per person

Located in Greater Manchester, Bolton, paid out on average £149 per person in returned goods between October 2021 and September 2022. The city had the highest average value of returns in the retail industry with £543 refunds on average per month. This shows an increase on last year's figures where the average value of return per person was £209, showing a shift in consumer spending in this city.

Southall consumers return less than in 2021

Southall ranked in second place in 2022 (previously ranking in first in 2021) with £145 refunded per person each month, which is significantly less than last year's results with £234 refunds on average per person. Southall consumers mostly returned home office items, which is unsurprising as we see some businesses are now moving to hybrid working. [7]

Perth concluded the top three cities in the UK, with £140 returns per person, ranking in the same place as last year, however, last year's data showed consumers in this city were returning on average £176.

The city returning the least amount of goods in our data report was Sunderland, returning on average £23, with Dorchester ranking just above with £35 returns per person.

UK consumers are returning less than in 2021

Overall the average amount being returned per person in the top 20 UK cities is lower compared to last year's top 20, with a 14.6% decrease in returns per person, which could be due to the rising costs of 2022 and consumers having to be careful on what they are spending, therefore, spending less on goods.

Which industries are seeing the highest return rates?

As part of our 2022 data, we found the industries which experienced the highest amount refunded per month per location in the UK.

Rank* Industry Number of refunds per location per month Amount refunded per location per month Average refund amount Growth versus 2021
1 Trades & Trade Supplies 6.8 -£716 -£105 39%
2 Accommodation & Travel 3.6 -£436 -£120 -6%
3 Home/Office Furnishing 2.0 -£330 -£161 -32%
4 Entertainment / Recreational 4.7 -£285 -£60 -28%
5 Retail 2.4 -£254 -£105 -23%
6 Automotive 1.3 -£222 -£171 8%
7 Garden & DIY 5.5 -£209 -£38 -27%
8 Apparel/Clothing 3.7 -£185 -£50 -3%
9 Other 2.7 -£181 -£66 -23%
10 Business Services 1.9 -£152 -£81 -11%

*Ranked by the amount refunded per location per month

The Trade and Supplies industry saw the highest amount refunded per month, per location, a 39% increase

The industry that saw the highest number of refunds per month was trade and supplies. The industry also saw a large increase in the value of the items returned, increasing by 39% compared to 2021. Post-pandemic, consumers have continued to work on renovating their homes with a massive 50% demand up for home renovations in 2022 making this an active industry likely to see both more sales and returns as a result [8].

Redhill saw the highest amount of refunds per month in the trades and & trade supplies industry with £2,711 refunds, a 54.4% growth compared to our 2021 data.

Accommodation and travel industries have seen the second highest return levels

Accommodation and Travel now ranks in second place, ranking third in our 2021 report, with a 6% decrease compared to last year. The decrease comes as lockdown is no longer restricting travel.

The Accommodation and travel industry had the most refunds in Ipswich with £2,340 refunds per month.

Home/Office and Furnishing now ranks in third, ranking one place down from last year, with a 32% decrease and Darligton had the highest amount of refunds per month in this industry (£917). Even though working from home is still the new normal, some workers are being asked to return to the office according to data collected in Business Insider, which explains the decrease of refunds per month this year compared to 2021.

The retail industry still ranks in fifth, however this industry has seen a 23% decrease, with only £254 refunds per month this year compared to £332 in last year's report.

The most searched-for brands in the UK and their online returns policies

As some brands have started to charge for returns in 2022, we have looked at the most searched-for brands in the UK and their returns policy, to see if they still offer free returns or if they now charge to return goods. 

Brand Average Monthly Search Volume Returns Policy Do they offer free UK returns?
Amazon 20,400,000 Most items on Amazon can be returned for free within 30 days Yes
Google 20,400,000 Free returns within 30 days of delivery Yes
Argos 11,100,000 Free returns within 30 days of delivery Yes
Next 7,480,000 £2.50 charge to return items within 14 days via Evri/ a Courier Yes if returned to store
Tesco 7,480,000 Free returns within 30 days of purchase Yes
Asda 6,120,000 Free returns within 30 days of purchase Yes
Sainsbury's 6,120,000 Free returns within 30 days of purchase Yes
Screwfix 6,120,000 Free returns within 30 days of purchase Yes
Boots 5,000,000 Free returns within 35 days of purchase Yes
Currys 5,000,000 Free returns within 21 days of purchase Yes
Marks & Spencer 5,000,000 Free returns within 35 days of purchase Yes
Morrisons 5,000,000 Free returns within 30 days of purchase Yes
B&Q 4,090,000 Free returns in store within 90 days, £50 home collection charge Yes/No - depends on return method
Ikea 4,090,000 Free returns within 365 days of purchase Yes
Aldi 3,350,000 Free returns within 14 days of purchase Yes
Asos 3,350,000 Free returns within 28 days of purchase Yes
Dunelm 3,350,000 Free returns within 28 days of purchase Yes
JD Sports 2,740,000 Return within 14 days of purchase Yes
Matalan 2,740,000 Return within 14 days of purchase Yes- free instore but £2.99 via Evri
New Look 2,740,000 Free returns within 28 days of purchase Yes

Brands are charging customers for returns in 2022

Due to a loss in profits from returns, some of the bigger brands are following in SMEs footsteps and now charging customers to return items. According to a Bloomberg report, the reason brands have had to start charging for refunds is due to higher transportation, energy and labour costs; all of which have made the returns process more expensive prompting sellers to change policies.

The brands no longer offering free returns compared to last year's report include Boohoo, Zara, Next, Sports Direct, JD Sports, Missguided, H&M and Oh Polly. The increase in brands now charging for returns has led to a whopping 247% increase in searches for ‘do I need to pay for returns’, making it clear there is some confusion for consumers around the cost of returns.

Customers are also reporting that they are less likely to shop with brands that charge for returns. Research from product performance management (PPM) stated that nearly half (47%) of consumers wouldn’t shop with an online retailer that charges for online returns [9]. This is bad news for big retailers like Zara and Missguided which have introduced small fees for returns, as it could have a negative impact on sales and brand perception.

How to prepare your small business for returns

To help small business owners prepare for customer returns, we have put together our top 5 tips on how to deal with returns:.

  • Make your return policy crystal clear
    By making your return policy super clear and accessible for your customers, including all the information and possible questions, it means your customer service team won’t have messages flooding in with ‘how to make a return’. If you’re looking to update your policy check out our guide on creating returns policies.
  • Create clear product information online
    Customers are less likely to return items if the item they receive is near a perfect match to the description on your site. So make sure to include details from sizing to material and plenty of images to showcase the item in detail.
  • Categorise your returned products
    Split your returns into categories of high-quality, mediocre or no good. High-quality products can be resold, mediocre products can be sold on sale or clearance, and lower-quality items that can’t be resold can be given to charity, recycled or disposed of as a last resort. Then once you receive a returned product, you can put it in one of your categories to keep your returns super organised over the festive period.
  • Ensure all your employees know your returns policy
    Make sure each employee knows how to deal with a return and what process is in place. Create a step-by-step guide and run a refund training session for your employees so that everyone has access to and can feel confident in providing great customer service.
  • Gather data on returns and compare you return policies year on year
    Make sure your employees are making a record of each time a return is processed, to see what products are returned and why, so you can help reduce the number of returns the next year. Also, ensure you always compare your returns policy year on year as there might be a pattern or something new you pick up on. This way you can see what's working for your business and what you need to put in place for next year to help simplify your returns process.
  • Ensure you have the tools you need to make the process easy
    To help with sales for your small business, make sure you have a card machine you can count on and that can produce refund receipts if needed. Paymentsense works hard to provide card machines that work for you and your business no matter your size or industry.

Need guidance on processing payments and returns? Our card machines will assist in-store whilst our online payments service will handle all digital transactions.


Unique data was collated by analysing anonymised transactions from Paymentsense card machines across the UK to find:

      • Regional refund figures using the number of refunds per business and total refunded per business
      • Regional refund figures by industry – cross-referenced above data with industry categories from Paymentsense merchants period – October 2021 to September 2022. This was then compared with the year before October 2020 to September 2021.

[1] Fast Fashion Market Value
[2] Black Friday returns and how much it cost retailers
[3] Consumers Say Hassle-Free Returns Are More Important Than Ever
[4] 25% of Top500 brands now charging consumers for returns
[5] How our spending has changed since the end of coronavirus (COVID-19) restrictions
[6] Why Gen Z Consumers Prefer “Buy Now, Pay Later”
[7] Is hybrid working here to stay?
[8] The UK home improvement boom: demand is up 50% into 2022
[9] Shoppers to shun online retailers who charge for returns


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