Basic solution would be for seller with low reputation to lower the price. Even if not a lot of buyers take the risk, lower price should eventually attract enough people to allow a legitimate seller to build the reputation.
People already don't trust too low prices, because that's a sign of a scammer. And margins are already rather low. Would you take a gamble save €10 or loose €1000? Even with all the customers' protection in place, I already rather pay 1-2% more if that means buying for a more reputable seller. Without the protection, they'd have to be in scammers' price range to be considered...
In many cases the entrenched players in the market already have good prices. Upstarts who can't use economy-of-scale try to make their way by providing superb customer service or providing a better service in another way. But it's hard to give it a try when you don't have the protection of chargeback.
Well, it's hard to compete in the already established markets.
But you have to, one way or another, usually by providing better value.
Be it lower price, faster delivery or higher quality products.
Otherwise, if there is no initiative for people to use your services, are you really necessary?
I'd argue that competition is mandatory in market economy. Having an easy way to get a basic level of customer trust lowers the entry barrier. Which is good to prevent monopolies and ensure market is functioning properly.
One of the most important values one can provide is trust. A known bad option is many times better than the unknown nothing. An upstart would have to provide much much more value to make up for that.
In many cases the entrenched players in the market already have good prices. Upstarts who can't use economy-of-scale try to make their way by providing superb customer service or providing a better service in another way. But it's hard to give it a try when you don't have the protection of chargeback.