Online retailers, facing a deluge of returns, are using AI to reduce the cost of processing unwanted goods. Typically, online returns could cost as high as $20, depending on the item. E-commerce returns are expected to cost around  $70 billion for this past holiday season. Clearly, for retailers, it is more economical to issue a refund without processing the return. However, cybercriminals are purchasing from e-retailers with the sole intention of getting a refund while keeping the goods.

Online retailers and retailers with significant online presence such as Walmart, Target, are fighting back with AI tools to reduce this enormous cost while preventing abuse and fraud. Using customer purchase history, price of the item, shipping cost, restocking cost, and several other attributes, AI tools decide if it is more cost-effective to issue a refund while letting customers keep the item free. The retailer is also alerted if abuse or fraud is detected.