Vendors cry foul as Shopee customer refund policy delays payout

On March 8 popular e-commerce platform Shopee changed its returns policy, increasing the return window from 3-7 days to 15. Vendors must wait for another two weeks to get their money if their products are returned.

Under this policy, buyers can return items for any reason without bearing the cost of shipping.

However, the new policy is creating problems for vendors, who are raising concerns that Shopee is withholding payments for all their sales, not just the returned items, for up to two weeks.

Hai Dang of HCMC, who has been selling sports goods on Shopee since 2022, said the platform has not paid him for the last two weeks though most of his customers have taken delivery without any complaints. Dang sold over 2,000 items for VND150 million (US$6,000) in the period.

Refunds have been sought for only a few products, but Shopee is keeping the whole amount, he said.Earlier he used to receive his money within three to five days.Unable to pay suppliers promptly, his business is slowing down, he said.

Other vendors complained that the new policy gives buyers the right to return products that have been used in a way that can no longer be resold.

Tran Huy Manh, a clothes vendor whose VND255 million is with Shopee, said the new policy is hurting vendors.Some customers wear his products for several days and return them with foul odors, he said."Often returned products are in no condition to be resold," he said. "I no longer have the motivation to continue selling."

Shopee told VnExpress that its 15-day return policy was aimed at giving customers more options and encouraging sellers to increase service quality.

The reason that vendors have to wait two weeks for their revenues is because Shopee’s system needs to review the products that have been returned.

But Shopee did not disclose its criteria it uses for determining which products to review, and this is the main reason for vendors’ disappointment, said e-commerce lecturer Do Quang Thuy.

Not surprisingly, buyers like the new policy.Thanh Hoa of HCMC’s District 12 said when she asked to return some clothes a week after buying them, a deliveryman came the same day and took them for free.A few days later she received the full refund.

Singapore-based Shopee is the biggest e-commerce platform in Vietnam, accounting for 73.7% of sales of the four biggest platforms in Vietnam in the last quarter of 2023, with the other being TikTok Shop, Lazada and Tiki.

It has 7,000 brands and vendors who sell 300 million products.

TikTok Shop came second at 16.9%, followed by Lazada, 8.2%.

An e-commerce industry insider, who asked to not be identified, said that in the future Shopee might increase the payout duration to vendors so it can have more cash to spend on discounts to ensure its dominance over TikTok Shop.

Shopee might increase the current 8-day payout policy to 15 days, or even 30 days, similar to that of U.S. e-commerce giant Amazon, the insider said.