Shopify faces complants from consumers and merchants

Shopify is one of the largest web hosts for online stores. The platform has over 800,000 merchants, who are able to store and ship merchandise to consumers. And with revenues of over $1 billion in 2018, Shopify is now the second largest e-commerce platform in the world – second only to Amazon.

However, the firm could be facing a major lawsuit due to a high level of complaints from merchants, who have accused it of having unfair fees, interest charges, and over its process for chargeback disputes.

Chargeback is a process where consumers can dispute charges if their goods were faults, didn’t arrive on time, or were sold fraudulently. But, many merchants say Shopify is too quick to side with consumers in these complaints, and even when the complaints are dropped, the company refuses to return the money and even adds further fees and charges to the merchant’s account.

Small merchants in particular are expressing great dissatisfaction with the service. Many believe they Shopify is “holding their money hostage” and that the charges are too high to make a profit. In addition, payments are being frozen pending verification for long periods of time and sellers say that company is unresponsive to complaints.

And it’s not just small businesses. Digital giant Mailchimp recently stopped working with Shopify, saying that changes to Shopify’s agreement could jeopardise the privacy of consumers.

It said in a statement: “As of March 21, we’ve asked Shopify to remove the Mailchimp for Shopify integration for new users from their marketplace. We made this decision because Shopify released updated terms that would negatively impact our business and put our customers at risk.”

Although a lawsuit hasn’t been confirmed, law firm Girard Gibbs LLP said it was  “investigating claims on behalf of investors of Shopify Inc. regarding possible violations of federal securities laws or other unlawful business practices.”