Freda recovers tourist VAT refunds automatically, at the card-scheme level. No paper forms. No airport booths. No merchant integration. The system is invisible to everyone except the tourist, who sees the refund on their card.
Tourist VAT refunds are a legal entitlement. A non-resident who buys goods and takes them home is owed the VAT back — in principle. In practice, the system to recover it has barely changed in four decades.
It runs on paper forms, airport booth queues, and customs stamps. The friction is so high that up to 85% of eligible refunds are never made. Of the minority that are claimed, legacy operators can take 30 to 50 percent in commission. The tourist walks away with pennies on the pound.
Every one of these is a dependency the legacy system can't remove. Each one is the consequence of running at the card-scheme level, rather than at the till.
Data comes directly from the card network, not the retailer. Merchants change nothing. Their POS, their staff, their VAT return — all untouched. The system is invisible to the shop.
A digital tax-free form is generated from the transaction the moment the card taps. No signatures. No passports. No customs-hall queues for small purchases.
Departure is proven passively from card-network signals in most cases. Where customs inspection is required for high-value goods, a QR code handles it digitally.
Recovered VAT credits back to the same card the tourist used to pay. No bank details. No app. No follow-up. The tourist does nothing and the refund simply arrives.
Eligibility, validation, and export are all derived from card-network data. The tourist does nothing. The retailer changes nothing. The tax authority receives a digital claim.
The card network detects a foreign-issued BIN in real time and flags the transaction as refund-eligible. The trigger is automatic. The tourist does nothing.
Using enhanced merchant data — MCC, country, VAT number, gross and net — Freda computes the exact VAT owed and generates a digital tax-free form. No merchant involvement required.
Fraud screening scores every claim in real time. For low-value goods, departure is proven passively from card signals. For high-value goods, a QR code replaces the customs stamp.
Freda submits the claim to the tax authority as a registered operator. On settlement, the refund credits back to the same card the tourist used to pay.
The tourist never signs a form, queues at a booth, or sees a kiosk. They just get a refund on their card after they travel home — from VAT they were always entitled to but, today, would almost certainly never have seen.
A forty-five second walkthrough — from tap, to refund.
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Freda doesn't divert tax revenue. It collects refunds that would otherwise go unclaimed — the tourist's own legal entitlement. Every participant earns on money that wasn't previously in circulation.
The tax authority keeps a protective buffer on every refund Freda files. Because the alternative today is that ~85% of this VAT is never claimed at all, the authority captures new revenue on money that would otherwise have stayed uncollected — while remaining protected against error and misuse.
| Stakeholder | Role | Share |
|---|---|---|
| Tourists | The rightful claimant | Up to 80% |
| Tax authorities | Protective buffer on each refund | 5% |
| Retailers | Programme participation fee | 2.5% |
| Card networks | Network facilitation fee | 2.5% |
| Freda | Registered operator · filing agent | 10% |
Approximately $100 billion in tourist VAT goes unclaimed every year. Recovering even a tenth creates $10 billion in annual value — and returns 80% of it to the tourists it was always owed to.
Note: These figures represent only the tourist VAT opportunity. They exclude the volume already handled today by legacy operators — which Freda can capture with a superior experience — and the separate corporate VAT recovery market, where industry estimates put unclaimed cross-border VAT at $20 billion+ annually, on top of a $2–3 trillion total flow.
The same card-based infrastructure extends directly to corporate VAT — the cross-border B2B spend where industry estimates put unclaimed VAT at $20 billion+ every year, on top of a $2–3 trillion flow. Our tourist product is the wedge; the enterprise market is the destination.
For deeper technical or regulatory questions, our team is happy to walk through the model in a confidential conversation.
Talk to us →Yes. Freda operates as a registered VAT refund operator, which is the legal status that entitles us to file refund claims with tax authorities on behalf of tourists. The paperwork is digital; the legal basis is the same as every other licensed operator in the market.
No. That's the point. Retailers change nothing about their till, their staff training, their payment processor or their VAT return. Eligibility, the tax-free form, the validation and the claim all happen in the card-network data flow — not at the point of sale.
As a credit back to the same card they used to pay. No bank details, no app, no paperwork, no separate account. Once the tax authority settles the claim, the tourist simply sees the refund arrive on their card statement.
Every flagged transaction is scored by a real-time screening layer that checks for unusual volumes, repeat high-value claims, patterns inconsistent with tourist behaviour, and velocity anomalies. Transactions exceeding the risk threshold are held or rejected. Beyond screening, the tax authority retains a buffer on every refund, which protects them against residual error without affecting the tourist's share.
Two things. First, the protective buffer is net-new revenue on refunds that, under today's paper regime, would overwhelmingly never have been claimed at all. Second, the card-based evidentiary chain is arguably stronger than the signed-form regime — every step is independently verifiable against network data, rather than self-declared on a piece of paper.
Our launch pathway is sequenced by jurisdictional fit: mature VAT regimes with established digital refund filing, strong card-scheme penetration, and high inbound tourist volumes. We are in active partner conversations and will announce specific corridors in due course.
We partner with card networks, tax authorities, retailers and tourism bodies to return VAT refunds to the tourists they belong to. If that's you, we'd love to talk.
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