Shopify Purges Merchants for Price Gouging and False Covid-19 Claims

Unfortunately, when disasters occur scammers aren’t too far behind, and this time is no different from the Covid-19 pandemic currently affecting everyone worldwide. Due to this, E-commerce services and payments provider Shopify Inc. are currently reporting that they have purged many merchants that have been engaging in suspicious practices in relation to the current coronavirus, or Covid-19 outbreak.

The Ottawa, Ontario-based processor mentioned this in a news release issued after the markets closed on Wednesday “In March, we terminated thousands of merchants charging unfair prices or making false claims about COVID-19 related items such as face masks or hand sanitizers,” According to the companies files, Shopify has had 1.07 million merchants on their site as of Dec. 31.

A spokesperson from Shopify told Digital Transactions News through email that currently over 5,000 merchants have been terminated. There have been reported shortages of personal protective equipment for doctors and nurses that need them in order to treat patients and to prevent themselves from getting the extremely contagious coronavirus. Therefore, it is no surprise that Shopify and many other merchant processors have clients on their platforms charging unreasonably high prices for personal protective equipment and cleaners. While also being untruthful about the products that they are selling. This is why Shopify Inc. had to step in and remove them.

Since March 8, around the time the government started implementing stay at home orders, Shopify has said that they have noticed patterns in their merchants’ business. Those patterns include a change from physical commerce to online and the common use of sales or discounts in an order to promote products. Despite claiming this the company didn’t release any numbers.

Shopify has also said that they have “taken a number of actions to support our merchants and protect our stakeholders during this time.” Those actions include committing $200 million to its Shopify Capital merchant-funding program and expanding out in order to encompass more countries. As Well as making available both physical and digital gift cards for its users, they also enabled delivery options and curbside pick-up for point-of-sale merchants, and lastly, they extended free trials to all merchants who signed up for their standard plan. For merchants currently on the 14-day free trial, they can now have it extended to 90 days.

Similar to many other companies, publicly-traded Shopify has suspended its financial guidance for 2020. The company has stated that they will report the results of their first quarter on May 6.

With many crucial products in such high demand, many Shopify merchants have taken advantage of that by charging high prices. Shopify has since taken the initiative to remove them.

Author Bio: Blair Thomas has been a music producer, bouncer, screenwriter, and for over a decade has been the Co-Founder of eMerchantBroker, the highest-rated high risk credit card processing provider in the country. He has climbed in the Himalayas, survived a hurricane, and lived on a gold mine in the Yukon. He currently calls Thailand his home with a lifetime collection of his favorite books.