The Swedish chain H&M has become the latest in the fashion sector to start charging shoppers to return unwanted items bought online.

The group, the world’s second-largest clothing retailer after Zara-owner Inditex, will charge £1.99 to take back items that are not damaged or faulty – either in stores or by post.

The cost will be subtracted from the customer’s refund unless they sign up to H&M’s free membership loyalty scheme.

The move, first reported by the BBC, follows similar charges brought in by rivals including Zara, New Look, Boohoo, Uniqlo and Next after a surge in the cost of delivering and processing returned items combined with increased use of the service. Some others, including Asos and Marks & Spencer, continue to offer free returns in an attempt to attract more customers.

H&M said it had begun charging for returns in the UK this summer and was already doing so in a number of other countries in Europe. It plans to introduce charges to more markets in the coming months.

A spokesperson said: “We strive to help our customers to find the right size and fit from the outset, in order to reduce the returns rate.”

Return rates slumped during the pandemic lockdowns when many people bought comfy elasticated clothing that did not require an exact fit. That pattern has since reversed, with sales of more structured items, such as dresses, surging after offices reopened and social events restarted.

Customers who began shopping online during the pandemic got used to buying a range of different products and sizes to try on at home, before deciding which ones to keep.

Up to half of clothing bought online is returned, with the whole operation estimated to cost about £7bn a year, according to a 2020 study by the consultancy KPMG.

The cost of handling returns has risen as wages for delivery and warehouse workers have gone up, as well as energy and petrol, while firms are under pressure to clean and mend items rather than send them to landfill or burn them.